Sustainability Report
About This Report
This is the eighth sustainability/social responsibility report released by the Company. This report outlines the
Company's efforts in environmental protection, social responsibility, and corporate governance in 2025, responding to
the expectations and concerns of stakeholders.
Reporting period Basis of Preparation
This report covers the period from January 1, 2025 to ◎ Chinese Academy of Social Sciences, "Guidelines for
December 31, 2025, with certain content extending Corporate Social Responsibility Reporting in China (CASS-
beyond this period. ESG 6.0)"
◎ Guidelines No. 1 of the Shanghai Stock Exchange for Self-
Regulation of Listed Companies — Standard Operation
◎ Shanghai Stock Exchange, "Self-Regulatory Guidelines
No. 4 for Listed Companies – Sustainability Report
Preparation"
Reporting Scope
This report covers the Company and its subsidiaries, ◎ Shanghai Stock Exchange, "Self-Regulatory Guidelines No.
branches, and directly affiliated entities. For ease 14 for Listed Companies – Sustainability Report (Trial)"
of reference, "Inner Mongolia Baotou Steel Union ◎ Global Sustainability Standards Board, "GRI Sustainability
Co., Ltd." is also referred to as "Baogang Steel", "the Reporting Standards (GRI Standards)"
Company", or "we" in this report. ◎ United Nations 2030 Sustainable Development Goals
(SDGs)
◎ Guidelines for State-owned Enterprises to Better Fulfill
Social Responsibilities of SASAC of the State Council
Sources of Information
and Reliability Assurance Access to this Report
The information and data disclosed in this report The electronic version of this report is available on the
are derived from official Company documents Company's website (https://www.baoganggf.com) under
and statistical reports and have been reviewed by Investor Relations – Sustainability Reports, or on the
relevant departments. The Company undertakes Shanghai Stock Exchange website (https://www.sse.com.
that this report contains no false records or cn/).
misleading statements and assumes responsibility
for its authenticity, accuracy, and completeness.
Chairman's Message 04 Responsibility Topic I 12
"Rare Materials for a Rare Era, Forging New-quality
Productivity for Major National Equipment"
About Baogang Steel 06
Annual ESG Performance 10
Responsibility Topic II 14
"Intelligent Manufacturing Engine, Empowering a
New Steel Ecosystem with Smart Technologies"
Responsibility Topic III 16
"Resource Symbiosis, Strategic Resource Security
and Green Development"
Sustainable Development Management 76
Future prospects 80
CONTENTS
Appendix 82
Governance Excellence Green Transformation Innovation Engine Driving Co-building and Sharing to
for Development
Strengthening Foundations Through 20 Climate Action and Low-carbon 34 R&D Breakthroughs and 52 Employee Development and Rights 64
Party Building and Strategic Leadership Transition "Rare" Product Innovation Protection
Enhancing Governance and 23 Resource Circularity with 39 Strengthening Quality Foundations 54 Safety First, Prevention and Control 70
Standardizing Operations Efficiency at the Core and Elevating the Brand as the Priority
Strengthening Compliance and 26 Cleaner Production and Pollution 43 Supply Chain Transmission and 58 Community Co-building and Local 73
Risk Prevention Prevention and Control Responsible Procurement Commitment
Ecological Restoration and 49 Industry Synergy and Standards 74
Harmonious Coexistence Leadership
Chairman's Message
Chairman's Message
In response to the call of the times and the responsibility of low-carbon development. We actively implemented the "dual carbon" strategy, driven by green
development, the Company has kept firmly in mind the earnest development as the foundation and digital-intelligent empowerment as twin engines. Green factory
instructions of President Xi Jinping, focusing on the goal of "long- practices delivered notable results, with self-generation rates reaching key milestones and energy
term stable profitability in the steel core business". We have made efficiency targets of the 14th Five-Year Plan exceeded. Hot-rolled products obtained low-carbon
every effort to "optimize structure, expand markets, improve steel certification, and the carbon management system was steadily established. We continued to
efficiency, strengthen performance, reduce costs, optimize consolidate ultra-low emission achievements, with major pollutant emissions steadily declining,
investment, and ensure quality". Guided by innovation, driven by demonstrating through action the green transformation of a traditional industrial enterprise.
integration, and oriented toward results, we accelerated growth
against headwinds and strengthened core capabilities through During the year, we strengthened digital-intelligent empowerment and built new advantages
transformation, delivering solid results, successfully completing all through digital transformation. We leveraged digital and intelligent technologies to drive industrial
targets of the 14th Five-Year Plan, and laying a strong foundation transformation. Our metering data application was selected as a national outstanding case, we
for a good start to the 15th Five-Year Plan. obtained the "Level 3 Intelligent Manufacturing Maturity" certification, and became the first advanced
smart factory in the steel industry of the autonomous region. We advanced lean management in
During the year, we deepened integrated development and parallel, strengthened "quality consistency" control, and steadily improved first-pass yield. Multiple
achieved a new level of operational quality and efficiency. products received the industry's "Golden Cup" awards, translating technological innovation into
We firmly advanced the strategy of "high-quality specialty steel tangible development value.
+ series rare earth steel", deepening the integration of business
and finance, as well as R&D, production, and sales. Output and During the year, we strengthened talent development to reinforce the Company, unlocking
sales of specialty steel and rare earth steel both reached record new momentum in team vitality. We deepened state-owned enterprise reform, implemented
highs. High-value products such as heavy rail, wind power tailored "one enterprise, one policy" assessments to unlock vitality, achieved notable progress
steel, and automotive steel made outstanding contributions, in reforming the three core systems, and significantly improved overall labor productivity. We
and "Baogang Manufacturing" has been widely applied in key implemented order-based training programs for on-site engineers, continuously expanding our
national projects. We accelerated the transformation toward talent pipeline. We strengthened our compliance and risk control system, ensured robust and
a "comprehensive materials solutions provider", advanced effective safety management, were selected as one of the 'Top 100 ESG Pioneer State-owned Listed
EVI cooperation in automotive steel, and promoted the Companies in China', and safeguarded high-quality development through standardized governance.
implementation of multiple customized projects. Product
upgrading continued steadily, and overseas markets
The road ahead is long, and only relentless effort will carry us forward. Let us stay grounded in
expanded continuously.
action and driven by innovation, carry forward the spirit of tackling challenges head-on, cultivate the
resilience to solve any problem, and maintain our pioneering drive. With the mindset that 'success
does not have to be mine' and the commitment that 'success must involve me', we will jointly shape
a more ambitious future for Baogang, advance firmly toward becoming a world-class enterprise, and
contribute strong momentum to writing a new chapter of Chinese modernization in Inner Mongolia.
Chairman of Baogang Steel
About Baogang Steel
About Baogang Steel Corporate Culture
Corporate Objective Corporate Spirit
Company Overview To build a world-leading manufacturing Perseverance and
base for rare earth steel new materials and continuous self-transcendence
become an outstanding service provider of
high-quality rare earth steel new materials.
The "Rare Earth Steel" brandvalue reaching
RMB 27.26 billion
Corporate Mission Corporate Vision
To deliver premium steel products and Specialty steel, green homeland
create a better life together
increase of
RMB 1.101 billion
Principal Businesses
Winner of
"Inner Mongolia Steel Industry Iconic Brand" Plates Seamless Steel Pipes Heavy Rail Sections Wire Rods
"Inner Mongolia Brand Building Benchmark
Enterprise" honors,
with ever-increasing brand value.
The Company operates CSP, The Company operates five The Company operates two The Company operates four
wide and heavy plate facilities, seamless pipe production world-class large universal wire and bar production lines
and internationally advanced lines with diameters rolling lines and residual heat and is an important high-end
Founded in 1954, Baogang was one of the 156 key projects constructed during China's First Five-Year Plan. It is the only steel enterprise 2,250 mm hot continuous rolling including 159 mm and quenching lines, making it wire rod and bar production
whose commissioning ceremony was officiated by Premier Zhou Enlai. The well-known story of "building Baogang through united lines, along with supporting cold 460 mm, making it one of one of the most advanced base in northwest China.
efforts", cited by President Xi Jinping, originated here. Baogang's development has attracted widespread attention and had a far- rolling, continuous annealing, China's most comprehensive and largest high-speed rail
reaching impact. In 1999, to establish a listed steel company, Baogang set up Inner Mongolia Baotou Steel Union Co., Ltd., primarily and galvanizing production seamless pipe production production bases globally.
based on its rolling assets. The Company was officially listed on the Shanghai Stock Exchange on March 9, 2001, with the stock code lines, making it the largest plate bases in terms of product
industry base in China.
Leveraging the unique co-existing iron ore and rare earth resources of Baiyun Obo, the Company has developed distinctive "rare earth Product Structure Industrial Chain
steel" products featuring excellent ductility, wear resistance, corrosion resistance, low-temperature resistance, toughness, and tensile Premium High-quality Steel Cold-rolled Deep Processing
strength. These products are widely recognized by downstream customers and have been applied in major national projects such as the
Series of Rare Earth Steel Steel Pipe Deep Processing
+ +
Beijing-Shanghai High-Speed Railway, Qinghai-Tibet Railway, Three Gorges Project, Beijing Daxing International Airport, and the China-
Russia East-Route Natural Gas Pipeline, and are exported to over 60 countries and regions including Europe and the United States. After
years of development, in 2025, the Company was recognized as a benchmark enterprise for brand building in Inner Mongolia for 2025, Looking ahead, the Company will remain committed to its dual core businesses of "steel + resource development", align with the new
marking its eighth consecutive year on the list. The "Rare Earth Steel" brand ranked among China's Top 500, with brand value reaching stage of development, uphold new development principles, integrate into the new development paradigm, and steadfastly pursue a
RMB 27.26 billion, an increase of RMB 1.101 billion compared with 2024. Twelve products received the "Gold Cup" awards from the China high-quality development path guided by ecological priority and green development, while fully advancing projects under the "carbon
Iron and Steel Association and the Company was recognized as a "China Outstanding Steel Enterprise Brand". peaking and carbon neutrality" plan. The Company focuses on advanced steel materials and rare earth steel new materials to drive
value enhancement of strategic products, strengthen regional market leadership, reinforce control over specialized niche markets, and
At present, the Company has an annual crude steel production capacity of 17.2 million tonnes, producing key products including enhance its international presence. It has made new breakthroughs in transforming into an integrated solution provider, established
heavy rail, wind power steel plates, wear-resistant steel, zinc-aluminum-magnesium coated steel sheets, pipeline steel, home itself as an industry benchmark for low-carbon development across the entire value chain and lifecycle, accelerated the development
appliance steel, automotive steel, and oil pipes. Its overall equipment level has reached international first-class standards, forming a of full-process intelligent factories, and is committed to becoming a leader in new-quality productivity for steel materials, an enabler of
production structure of four premium product lines: "plates, pipes, rails, and wire". green and low-carbon steel materials, a core creator of value across the industrial chain, and a first-class steel enterprise.
About Baogang Steel
The Company firmly implemented the
Company History The Company acquired mineral processing-related The Company launched an ultra-low product structure strategy of "premium
assets from Baogang Group, iron separation assets emission retrofit project for a 5 million- steel + series of rare earth steel", with
under the Baiyun Obo comprehensive utilization tonne pellet belt roasting machine. specialty steel sales increasing by 9.65%
project, and tailings pond assets. year-on-year.
The Company was established as Inner
Mongolia Baotou Steel Union Co., Ltd. 2025
The Company acquired rare earth and 2023
niobium separation assets from the Baiyun
The Company's annual steel production
Obo resource comprehensive utilization
project of Baogang Group Baoshan Mining 2024
Company, accelerating the development
reached 10 million tonnes, placing it among
and utilization of tailings resources.
China's large-scale steel enterprises with
ten-million-tonne capacity.
The Company completed an 800,000-tonne The aluminum-magnesium coated dual-
fluorite beneficiation production line and phase steel product was successfully
fluorochemical production line, achieving applied in the automotive industry for the
of fluorite resources.
first time and passed trial molding, paving
the way for large-scale application and
accelerating market expansion in both
Organizational Structure
Meetings of Shareholders
ESG Committee
Party
Committee Board of Directors Audit committee
Remuneration and
Management
Assessment Committee
The Company acquired 100% equity in
Barun Mining Co., Ltd. held by Baogang
Group and the mining rights of the West
Mine of the Baiyun Obo iron ore.
General Affairs Department
Labor Union
League Committee
Communist Youth
Financing Department
Securities and
nspection Commission
Discipline I
Resources Department
Organization and Human
Audit Department
Legal Affairs Department
Finance Department
Planning Department
Department
Safety Management
Manufacturing Department
Department
Equipment Engineering
Low-carbon Energy Center
Procurement Center
Marketing Center
Technology Center
Steel Research Institute
The rare earth steel plate project was
fully completed, marking a milestone
in the transformation and upgrading of
The Company was officially listed on the steel industry in the Inner Mongolia
the Shanghai Stock Exchange. Autonomous Region.
Annual ESG Performance
Annual ESG Performance In September 2025
the rare earth high-strength,
high-toughness casing pipe
independently developed
by the Company's steel pipe
In February 2025 subsidiary was successfully
the Company's aluminum- In August 2025 deployed for the first time in
magnesium coated dual-phase an ultra-deep well at a depth
the Company's independently
In June 2025 In October 2025 In November 2025
steel was successfully applied in the proposed list of advanced of 8,000 meters. This enhanced the Company successfully
developed 400 km/h high- the case titled "'Full-chain
the automotive sector for the first smart factories in the Inner the core competitiveness of the trial-produced 1000 MPa-
speed rails were successfully metrology data + laser vision
time and passed trial molding. Mongolia Autonomous Company's steel pipe products, grade ultra-high-strength,
In March 2025 supplied to a domestic + AI algorithms' collaborative
The product has completed Region was released, and provided valuable experience weldable rare earth steel
the Company's wind power high-speed railway under application driving intelligent
preliminary work including the Company was included for the industry's development plates for hydropower
steel products successfully construction. All performance heavy rail production and
laboratory and industrial coil in recognition of its of pipes for ultra-deep well applications, marking a
won the bid for a major indicators reached leading comprehensive testing
trials and is currently undergoing outstanding achievements operations, and offered major breakthrough in high-
domestic wind power project, levels in China, further efficiency improvement",
application testing with a in digital transformation and important technical reference strength steel materials for
providing critical support strengthening the Company's submitted by the Company's
popular vehicle model. intelligent manufacturing. for developing steel pipe hydropower.
for the national key project technological leadership in metrology center, was
products suitable for ultra-deep
"Xinjiang Power Transmission high-speed rail materials and selected as one of the first
wells exceeding 9,000 meters.
to Chongqing" and promoting providing higher-quality core batch of typical metrology
regional energy structure material support for the rapid data application cases by
optimization and low-carbon development of China's high- the State Administration for
transition. speed railway network. Market Regulation.
In March 2025 In August 2025 In October 2025 In November 2025
the first urban light rail line in the Company achieved the ESG China Innovation a key science and technology
Central Asia using rails fully bulk export of its first batch Annual Conference (2025) and project titled "Development
supplied by the Company—the In April 2025 of high-strength heat- the first ESG International and Industrialization of Rare
Kazakhstan light rail project— the Company's first batch of treated rails compliant with Expo were held in Beijing, Earth Microalloyed Steel
In January 2025 officially entered the track- independently developed high- European standards, marking In August 2025 and the Company was In November 2025 Series Products", led by the
the Company achieved a new laying stage. It will become one end chromium-molybdenum a historic breakthrough during the 14th China selected for the "Top 100 ESG the Company held the Company in collaboration
breakthrough in metallurgical of the most technologically pressure vessel steel for hydrogen in high-end European- International Steel Pioneer State-owned Listed hydrogen pipeline promotion with China Iron and Steel
process innovation. The representative urban rail service was successfully rolled standard rail manufacturing. Conference, the Company's Companies in China" list. and technical seminar titled Research Institute Group,
industrial trial of pellet transit projects in Kazakhstan off the production line, with all The successful large-scale hot-rolled coil products were "Hydrogen for the Future, Steel passed final acceptance.
charging for the country's and Central Asia, marking performance indicators meeting supply of these high-strength awarded a low-carbon steel as the Backbone" at Baogang The project enhances the
largest 624 m? belt roasting a substantive breakthrough required standards. This marks heat-treated rails marks a certification, becoming the Hotel. At the event, two new performance advantages of
machine was successfully in the Company's deep another breakthrough in high- historic breakthrough in the first steel product in the products—hot-rolled pipeline rare earth steel and injects
completed, marking a participation in the joint end vessel steel technology and Company's efforts to deepen Inner Mongolia Autonomous steel strips and seamless pipes new momentum into high-
new advancement in the construction of the "Belt and injects new momentum into the its presence in the European- Region to receive this for long-distance hydrogen quality development of the
Company's pellet production Road Initiative". development of materials for standard market and certification. transmission—were released, manufacturing industry.
technology within the steel China's energy and chemical accelerate the development and the "Hydrogen-resistant
industry. equipment sector. of a comprehensive product Steel Joint Laboratory" was
portfolio. officially launched.
Responsibility Topic I
"Rare Materials for a Rare Era, Forging New-quality Productivity for Major National Equipment"
Responsibility Leveraging the world-class rare earth resources of
the Baiyun Obo mine, the Company focuses on the
Building Premium Steel Products to Support National Strategies with
strategic direction of "premium steel + series of rare Rare Earth Steel
Topic earth steel". It fully harnesses the role of rare earths—
known as "industrial vitamins"—in enhancing steel
The Company continues to expand application scenarios for rare earth steel around major national projects and high-end equipment
needs, aligning product development with key industry demands and continuously enhancing the depth of application and market
Topic One performance, strengthens new-quality productivity
influence of rare earth steel in sectors such as rail transit, energy development, and major infrastructure.
t h ro u g h te c h n o l o g i ca l i n n o vat i o n , a n d h a s
established a comprehensive rare earth steel R&D The Company has developed a full range of specialized railway steel products covering high-speed railways, heavy-haul railways,
system comprising five product series, 67 varieties, and cold-region railways. It has continuously supported major railway projects both domestically and internationally, including the
"Rare Materials for a Rare and over 300 grades. In response to the needs of high-
"Hungary–Serbia Railway", "China–Laos Railway", and "Baotou–Yinchuan High-speed Railway", demonstrating the strong application
end and green development in the manufacturing
Era, Forging New-quality capabilities of rare earth steel in major engineering projects.
sector, the Company continues to transform its
rare earth resource advantages into material and
Productivity for Major industrial advantages, steadily enhancing its capacity The Company supported the launch of track laying for the first intercity railway in Central Asia
National Equipment" to supply high-performance steel and support major
national projects.
In March 2025, the first urban light rail line in Central Asia using
rails fully supplied by the Company—the Kazakhstan light
The Company continues to refine its integrated "resources–R&D–manufacturing–standards–market" advancement mechanism, rail project—officially entered the track-laying stage. Upon
positioning rare earth steel as a key driver of its "premium steel + series of rare earth steel" strategy. It coordinates efforts across completion and operation, the project will reduce commuting
original technology development, product system optimization, standards and patent layout, and key application scenarios, time between the two ends of the line by nearly half. It will
accelerating the transformation of resource, R&D, and manufacturing strengths into product and market advantages. In 2025, the become one of the most technologically representative urban
Company's R&D investment intensity remained above 5%, further strengthening the foundation for rare earth steel research and rail transit projects in Kazakhstan and Central Asia, marking a
innovation. Focusing on "rare earth + steel" application research, the Company has developed 83 core technologies, formulated and
substantive breakthrough in the Company's deep participation
revised nine international and industry standards for rare earth steel, obtained 1,920 authorized patents, and achieved first-in-industry
in the joint construction of the "Belt and Road Initiative". High-quality Rail Products
launches of 10 products, including hydrogen embrittlement-resistant pipeline steel, further reinforcing its technological accumulation
and expanding its brand influence in the rare earth steel sector.
Dual Breakthroughs in High-end Rails at Home and Abroad, Continuously Enhancing the
Optimizing Production Processes to Build Quality through Innovation Company's Competitiveness in Rail Materials
The Company advances product upgrades through process innovation, focusing
on the application potential of rare earth elements in wear resistance, corrosion In 2025, the Company's independently developed 400 km/h high-speed rails were successfully supplied to a domestic
resistance, toughness, and weldability. It continuously optimizes production high-speed railway under construction, with all performance indicators reaching leading levels in China. Meanwhile,
processes and performance control systems, driving the evolution of rare earth steel the first batch of R370CrHT high-strength heat-treated rails compliant with European standards achieved bulk export,
from specialized R&D to scaled and high-end supply. marking significant progress in high-end European-standard rail manufacturing. These two breakthroughs demonstrate
the Company's continued advancement in the R&D and manufacturing of high-speed rail materials, as well as its
As of the end of 2025, the Company had developed more than 60 new products,
comprehensive capabilities in international standard alignment, complex process control, and stable large-scale supply.
including rare earth welding wire steel, high-grade cold-rolled/galvanized ultra-deep
They further enhance the high-end rail product portfolio and provide strong support for national key projects, expansion
drawing steel sheets for automotive and home appliance applications, hydropower
into high-end overseas markets, and the transition toward higher-value products.
steel series, high magnetic induction grain-oriented silicon steel, and 400 HB-class
hypereutectoid heat-treated rails. In addition, 12 products, including hydrogen
transmission pipeline steel, achieved first-in-industry launches, filling multiple Quality inspectors are conducting thorough and
market gaps. "Baogang Rare Earth Steel" has gradually become a well-recognized detailed inspections of newly produced rare earth
brand with both strong technical capabilities and market acceptance. wear-resistant steel
The Company's self-developed rare earth oil casing successfully applied in an ultra-deep well for
the first time
In September 2025, the Company's independently developed rare earth
high-strength, high-toughness oil casing was successfully deployed for the The Company's rare earth steel supports the smooth operation of the The Company's rare earth high-strength, high wear-resistant heat-treated
Baotou–Yinchuan High-speed Railway rails are applied in the "West-to-East Coal Transportation" project
first time in an ultra-deep well at a depth of 8,000 meters. This successful
application in ultra-deep well operations not only enhanced the core
Rare earth steel has become a key driver for the Company in upgrading its product structure and enhancing high-end supply capacity.
competitiveness of the Company's steel pipe products, but also provided
The proportion of specialty steel sales continues to increase, the rare earth steel product system is continuously enriched, and both
valuable experience for the industry in developing pipes for ultra-deep
product influence and brand recognition are further strengthened. Looking ahead, the Company will continue to implement its
well operations and offered important technical reference for steel pipe
rare earth steel new materials expansion plan, targeting no fewer than 10 first-in-industry product launches. It will further advance
products designed for ultra-deep wells exceeding 9,000 meters. Rare Earth Oil Casing
the development of high-strength lightweight, corrosion-resistant, and customized products, continuously enhancing the market
competitiveness and value creation capability of rare earth steel.
Responsibility Topic II
"Intelligent Manufacturing Engine, Empowering a New Steel Ecosystem with Smart Technologies"
Responsibility The Company keeps pace with the digital and intelligent
era, taking "intelligent production and smart operations"
Advancing ○ With the goal of building an excellence-level smart factory, the Company promoted the full-
scale development of central control centers, integrating information silos across production
Comprehensive
as its core strategic direction. It continues to advance
Topic processes and enabling centralized control and information sharing at production sites. As of
Deployment of
the development of "Digital Baogang", driving deep Intelligent Central
integration of digital and intelligent technologies with the end of 2025, more than 30 central control centers had been completed.
Topic Two Control Centers
steel manufacturing. Focusing on key areas such as
production operations, equipment management, quality
control, and supply chain coordination, the Company ○ The Company promoted deep integration between business operations and information
"Intelligent Manufacturing continues to advance information system development, systems, established data connectivity across systems, and implemented standardized
Deepening Data
automation upgrades, and data governance in a governance and regulated use of key business data;
Governance
Engine, Empowering a New coordinated manner, promoting the evolution of
and System
Integration
○ It also streamlined the full-process cost control system for infrastructure project management,
digitalization from isolated applications to full-process
Steel Ecosystem with enabling end-to-end data digitalization and promoting automatic integration across
integration. business systems.
Smart Technologies"
In 2025, the Company obtained Level 3 certification under the national Intelligent Manufacturing Capability Maturity Model (CMMM) Strengthening ○ The Company prioritized equipment management as a key focus of digital and intelligent
and AAA certification under the "Integration of Informatization and Industrialization" management system, and was recognized as the Intelligent transformation. Based on existing systems, it added monitoring points for A+ category
first "Advanced Smart Factory" in the regional steel industry. The numerical control rate of key processes and the digitalization rate of
Monitoring Across equipment, enabling real-time monitoring of operating conditions and timely fault warnings;
the Equipment
production equipment reached 84.17% and 61.81%, respectively, further strengthening the Company's digital and intelligent foundation. Lifecycle ○ Centered on the "Integrated Maintenance" system, the Company provides digital tools for full
Meanwhile, the Company's intelligent manufacturing capability reached the "Advanced Level" under the MIIT intelligent manufacturing lifecycle equipment management, with a focus on condition monitoring and end-to-end
maturity standard, placing it among the leading tier in the industry. management of A+ category equipment.
Optimizing ○ The Company upgraded information systems across core business processes, optimizing
Information procurement workflows within the supply chain management system and reducing
Systems Across procurement costs.
the Full Business
Chain ○ Within the quality management system, the Company improved product traceability
efficiency, reduced the rate of non-conforming products, and enhanced the efficiency of
handling quality-related claims.
Deploying ○ The Company developed and deployed the Baogang AI intelligent recognition and analytics
Artificial system, installing multi-point cameras across selected production lines and key scenarios to
Intelligence Across enable intelligent detection and real-time alerts for events such as conveyor belt deviation
Operational and unauthorized personnel crossing, thereby advancing the on-site application of artificial
Scenarios intelligence.
Enhancing Digital and Intelligent Management
The Company continues to improve its digital and intelligent management system, strengthening the foundation for intelligent
manufacturing through standardization and systematization. Through system certifications, process optimization, and rule development,
the Company has further enhanced the standardization and coordination efficiency of its digital and intelligent management, providing
a solid foundation for the deployment of intelligent scenarios and end-to-end integration.
The Company was recognized as an "Advanced Smart Factory"
in Inner Mongolia Autonomous Region
Intelligent Central Control Center at the Rail and Beam Plant, Reshaping Smart Mining Activates the Resource Engine, Advancing from Isolated
Industrial Capabilities Through End-to-End Smart Manufacturing Breakthroughs to Ecosystem Synergy
Advancing Digital and Intelligent Transformation
Intelligent manufacturing has become a key enabler for the Company to enhance manufacturing efficiency, product quality, and
In 2025, the Company advanced digital and intelligent transformation initiatives across five key areas—hardware infrastructure, data operational coordination. Looking ahead, the Company will continue to advance the "AI+" initiative, enabling end-to-end data
governance, equipment management, system optimization, and technology application—driving implementation across multiple connectivity across mining, ironmaking, and steel rolling processes, building smart production lines and customized intelligent
dimensions and translating top-level design into frontline execution. factories, and driving the evolution of intelligent manufacturing from scenario deployment to business empowerment.
Responsibility Topic III
"Resource Symbiosis, Strategic Resource Security and Green Development"
Responsibility Leveraging the resource endowment of the Baiyun
Obo mining area and its core steel business, the
Advancing Green Design and Development
Company continues to advance coordinated The Company integrates green and low-carbon principles throughout the entire R&D process, focusing on rare earth new materials
Topic efforts in resource security, comprehensive
utilization, and green development, striving to
and advanced steel materials, strengthening fundamental research, standards development, and downstream application
Topic Three coordination, and promoting the shift from raw material supply to high-value utilization. Leveraging the unique co-existence of
transform resource advantages into industrial and iron and rare earth resources at the Baiyun Obo Mine, the Company is committed to building the world's largest base for rare
development strengths. The Company positions earth raw materials and new functional materials, focusing on rare earth new materials and advanced steel materials. Focusing on
resource and comprehensive utilization industries key bottleneck technologies in rare earth steel new materials and comprehensive resource utilization, the Company strengthens
"Resource Symbiosis, as key growth drivers, continuously enhancing fundamental research in end-use applications, advances standards development and labeling applications, and has achieved a series
the "resources–materials–products–recycling" of major technological breakthroughs. By incorporating the "RE" designation into rare earth steel grades, the Company enhances
Strategic Resource Security value chain through resource development, product recognition and brand influence, strengthens its capacity to supply high-end products and core competitiveness, and
green design, and high-value utilization, and continuously improves the value creation of rare earth steel.
and Green Development" strengthening its control over strategic resources
and overall resource utilization efficiency.
The Company has established a drone countermeasure and control system across three key areas—the concentrator tailings
pond, Barun Mine and its tailings pond, and Baoshan Mining—to safeguard information security in rare earth strategic resource
protection zones and sensitive classified areas under its jurisdiction.
Securing Strategic Resource Supply
The Company regards resource control as a fundamental pillar for enhancing industrial security and stability, continuously
strengthening its capabilities in mineral resource development and utilization to support core business growth and industrial
upgrading. The Baiyun Obo Mine is the world's largest deposit of co-associated iron, rare earth, and niobium resources, and a major
repository of China's mineral wealth, widely known as the "fertile sacred mountain" and the "world capital of rare earths". The Baiyun
Obo Mine is a multi-metal co-associated deposit of iron, rare earth, niobium, and fluorite, consisting of the Main Mine, East Mine, and
West Mine. The West Mine, owned by the Company, is a multi-metal co-associated deposit of iron and rare earth. It has proven iron The Company's rare earth OCTG was applied for the first time in an 8,000-meter deep well
ore reserves of 750 million tonnes and an annual mining capacity of 10 million tonnes. With its unparalleled resource diversity, the
Baiyun Obo Mine has provided critical support for major breakthroughs in China's research on the occurrence patterns of rare earth
elements.
Baiyun Obo Mine Resource Reserves
Proven iron ore resources of The largest rare earth resource Fluorite concentrate output exceeding
reserves in the world
billion tonnes tonnes
Niobium resources ranking
second globally, after Brazil
The Company successfully trial-produced 1000 MPa-grade ultra-high-strength, easy-to-weld rare earth steel plates for hydropower applications
A new rare earth mineral, named "Huangheite- Two new niobium-rich minerals, "Zuolinite" and
(Nd)", was discovered in the central section of the "Hongruite", were discovered in the Baiyun Obo
Resource and comprehensive utilization industries have become a key support for the Company's industrial synergy and value
main ore body of the Baiyun Obo deposit and has mining area and have been officially approved by
extension. Looking ahead, the Company will further strengthen its resource control and comprehensive utilization capabilities,
been unanimously approved by the Commission on the Commission on New Minerals, Nomenclature
accelerate the development and utilization of mineral resources at the Baiyun Obo Mine, advance hydrogen-based phase
New Minerals, Nomenclature and Classification of and Classification of the International Mineralogical
transformation of medium- and low-grade oxidized ores, and promote the upgrading of fluorine materials and coal coking-based
the International Mineralogical Association. Association.
materials toward new energy materials and electronic chemicals, thereby extending resource development to support industrial
upgrading and new growth drivers.
SDGs Targets
Governance Excellence
Driving Steady
Development
The Company upholds high-quality Party building as a driver of high-quality development, deeply integrating Party
leadership into all aspects of corporate governance, strengthening its political foundation, and enforcing strict discipline and
work conduct. In 2025, in response to the revised Company Law of the People's Republic of China and new capital market
regulatory requirements, the Company continued to optimize its governance structure, strengthened compliance and risk
management, and established a modern corporate governance system characterized by clearly defined and transparent
responsibilities, coordinated operations, and effective checks and balances, providing strong political and organizational
support for steady development.
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
Strengthening Foundations Through
Party Building and Strategic Leadership The Baogang Party Committee organized a dedicated
study session on "Deeply Studying and Implementing
Guided by Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, the Company's Party Committee fully
the Spirit of the Fourth Plenary Session of the 20th
implements the key principles on Party building and self-reform, thoroughly carries out the decisions and deployments of the CPC
CPC Central Committee, Fulfilling Entrusted Missions,
Central Committee and higher-level Party organizations, upholds and strengthens overall Party leadership, reinforces the sense of a
Advancing with Gratitude, and Building a Globally
shared Chinese national community, strictly implements the Eight-point Decision on improving work conduct, advances discipline
Leading World-class Enterprise"
enforcement and anti-corruption efforts, and ensures all work is carried out effectively, with high-quality Party building providing
strong guidance and assurance for high-quality development.
Political Leadership Setting Strategic Direction Strengthening Discipline and Promoting Integrity
The Company places political development at the forefront, translating the strengths of Party leadership into governance The Company consistently maintains strict governance, integrating Party conduct improvement and integrity risk prevention into
effectiveness. By improving governance structures and strengthening political oversight, it ensures alignment between corporate all aspects of operations and management. Through ongoing efforts to address the "Four Forms of Misconduct" and deepen anti-
development and national strategies. corruption initiatives, it has fostered a clean and disciplined business environment.
○ The Company strictly implements the "First Agenda" mechanism, ensuring the timely communication and study of the
latest important speeches and instructions of President Xi Jinping. ○ The Company established a coordinated mechanism integrating political, routine, and special-
purpose oversight, ensuring effective alignment across all forms of supervision.
○ The Company takes strengthening the sense of a shared Chinese national community as a Strengthening
Strengthening guiding principle across all work, integrating it deeply into Party building, business operations, and Political ○ It carried out targeted oversight in key areas such as the implementation of the Fourth Plenary
the Political corporate culture. Oversight Session of the 20th CPC Central Committee and personnel selection and appointment.
Foundation
○ The Company carried out in-depth education on implementing the spirit of the Eight-point ○ Throughout the year, the Company reviewed 418 pre-decision reports on "major decisions, major
Decision, advancing integrated actions of learning, inspection, and rectification, with all 13 identified appointments, major projects, and large capital operations", ensuring that power is exercised in a
issues in 2025 fully rectified and closed. standardized manner under effective oversight.
○ Leveraging platforms such as the Party Committee's theoretical study group, learning forums, and the "Three Meetings
and One Lecture" system, the Company advanced tiered and targeted theoretical learning for Party members and cadres,
○ The Company precisely applied the "Four Forms of Oversight and Discipline Enforcement",
enhancing political literacy. Its research achievement, "Practices and Exploration of High-level Ideological and Political
addressing issues at an early stage and preventing escalation, strictly investigating violations of
Work Empowering High-quality Enterprise Development", was awarded by the China Metallurgical Political Research
discipline and law, and upholding the rigidity of discipline.
Enforcing Strict
Association. Discipline and
Accountability ○ The Company conducted joint supervision and inspections in key areas such as bulk procurement
○ The Company formed a communication team composed of model Party members, model and tendering, promoting the standardized exercise of business authority.
workers, outstanding female representatives, and youth exemplars, conducting face-to-face
Strengthening ○ The Company supported the Party Committee in advancing full and rigorous Party governance,
outreach at the frontline and reaching over 1,000 employees.
Ideological urging Party organizations at all levels to fulfill their primary responsibilities.
Guidance ○ The Company launched the "Micro Party Lecture Month" initiative, adopting a model of "one
theme per month with everyone as a speaker" to promote deeper understanding and internalization
of the Party's innovative theories.
○ The Company continuously optimized its communication strategy, producing nearly 100 themed reports on "Strengthening ○ The Company intensified efforts to address misconduct and corruption affecting employees and
the Enterprise through Branding", and publishing over 120 articles on reform and development achievements in the public, organizing warning education sessions that analyzed 19 typical cases, reaching over 400
authoritative media such as China Metallurgical News, further enhancing brand reputation and social influence. Strengthening cadres and employees.
Work Conduct ○ The Company implemented long-term mechanisms to reduce burdens at the grassroots level,
optimized document circulation and reporting processes, and consolidated 127 low-efficiency
WeChat groups, effectively reducing repetitive work.
○ The Company conducted oversight on issues such as inadequate performance of duties and poor
work conduct among cadres, providing admonitions and corrective education to responsible
The Company received the 2025 "SSE Eagle · Golden Quality" Award
personnel, and effectively addressing formalism and bureaucracy.
for Excellence in Party Building
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
Strengthening Organizational Foundations Enhancing Governance
The Company emphasizes the role of grassroots Party organizations as strongholds and Party members as role models. By building
distinctive Party-building brands and deepening cultural and ideological development, it has fostered a strong collective drive for and Standardizing Operations
entrepreneurship and performance.
The Company strictly implemented the revised Company Law of the People's Republic of China and new capital market regulatory
○ The Company advanced the Party and mass organizations' special initiative of "Focusing Efforts to requirements, continuously optimizing its corporate governance structure. The Company revised and improved core governance
Promote Reform and Ensuring Implementation through Practical Actions". policies, including the Articles of Association, Rules of Procedure for Shareholders' Meetings, and Rules of Procedure for the Board
of Directors. It formally abolished the Supervisory Board, with its statutory functions assumed by the Audit Committee of the Board,
○ The Company established 58 Party-building initiatives targeting bottlenecks and challenges in
Implementing
further clarifying the responsibilities and authority boundaries of the Shareholders' Meeting, Board of Directors, management, and
production and operations.
Targeted
Initiatives specialized committees, and continuously improving a governance mechanism characterized by clearly defined and transparent
○ The Company leveraged Party building to address development challenges, enhancing both responsibilities, coordinated operations, and effective checks and balances.
quality and efficiency in core operations.
○ The Company established a comprehensive Party-building brand matrix guided by the principle Improving the Governance System
of "Bearing Responsibilities with Iron Shoulders and Reflecting Original Aspirations through the
Build Furnace", achieving a 100% brand development rate across all units. The Company has established a three-tier governance structure of "Shareholders' Meeting–Board of Directors–Management", and
set up three specialized committees, namely the Strategy, Risk and ESG Committee, the Audit Committee, and the Nomination,
Fortress-type ○ The Company completed the establishment of stronghold Party branches with high quality,
Remuneration and Appraisal Committee, forming a corporate governance mechanism with clearly defined and transparent
Party Branches achieving a 100% completion rate across 308 Party branches.
responsibilities, coordinated operations, and effective checks and balances.
○ A total of 98 branches were recognized as Company-level stronghold branches, and 35 were
designated as model stronghold branches.
Meetings of Shareholders
The highest authority of the Company, composed of all
Strategy, Risk and ESG Committee
shareholders, responsible for making decisions on major Responsible for providing recommendations on medium- and long-term
○ The Company formulated the "2025 Key Points for Party Building" and the "Implementation
corporate matters. development strategies, risk management, major investment decisions,
Plan for Special Initiatives of Party and Mass Organizations", establishing a system that deeply and ESG objectives, governance structures, policies, and reporting.
integrates Party building with business operations.
Optimizing
Institutional Board of Directors
Framework ○ The Company established a mechanism that aligns Party building with production and operations Audit committee
in planning, deployment, evaluation, and incentives, incorporating Party-building outcomes into Responsible for setting strategies, making decisions, and
preventing risks. For major operational and management Assumes the functions of the former Supervisory Board. Responsible for
core performance indicators for grassroots units. reviewing financial information and its disclosure, and overseeing and
matters, Board decisions are subject to prior review and
discussion by the Party Committee. evaluating internal and external audits and internal controls.
Nomination, Remuneration and Assessment Committee
Management
Responsible for the selection and qualification review of directors and
Appointed by the Board of Directors, responsible for senior management, as well as the formulation of remuneration policies
business operations, execution, and management, under and performance evaluation.
a tenure-based and contract-based management system.
Key Governance Initiatives
Enhancing the Performance Capabilities of Directors, Supervisors and Senior Management
○ The Company organized directors, supervisors, and senior management to participate in specialized training programs such
as the "2025 Session 1 Follow-up Training for Independent Directors of Listed Companies", "Independent Director Capacity-
building Training", and "Analysis of the Regulatory Environment, Public Opinion, and Value Management under the New 'Nine
Guidelines'", enhancing their compliance performance and scientific decision-making capabilities.
Standardizing the Operation of Shareholders' Meetings
○ The Company strictly convenes and holds shareholders' meetings in accordance with regulations, adopts a combination of on-site
and online voting, and implements the "one-click access" system for shareholders' meetings to increase shareholder participation.
○ Meeting time and venue are arranged with full consideration of shareholder convenience, with a director attendance rate of 91.23%.
The Company's Party Committee organized a 2025 demonstration training program for young cadres, Party
branch secretaries, and Party affairs personnel ○ Each shareholders' meeting resolution discloses in detail the attendance and participation of directors, supervisors, and senior
management, safeguarding shareholders' rights to information and participation.
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
In 2025 Communication Channels Key Measures and Outcomes
the Company held: 17 Board
meetings 3 meetings of
independent directors 15 Board committee
meetings
○ The Company hosted 15 on-site visits by investment managers and analysts
from institutions such as CITIC Securities, Huatai Securities, and Taiping
On-site Investor
shareholders' Board independent female
Insurance, presenting key highlights of its development.
meetings members directors directors Engagement
○ The Company's management led delegations to conduct 5 offline
Offline roadshows in Beijing and Shanghai and 13 online roadshows, presenting
Roadshows operational performance and product advantages to institutional investors
such as securities firms and fund companies.
Results ○ The Company held 3 earnings briefings, building an efficient communication
briefings bridge with investors and conveying its long-term value
○ The Company organized 4 investor engagement events to present its key
strengths and communicate on enhancing capital market image and market
Investor
value management.
Open Day
○ The Company participated in 3 strategy conferences hosted by securities
firms and organized dedicated investor sessions to provide in-depth insights
Industry Conference
into its resource advantages and operational highlights.
Engagement
○ The Company responded to over 190 investor inquiries on the SSE
e-Interaction platform and handled more than 220 investor hotline calls,
Online Platform effectively communicating its intrinsic value.
○ The Company published highlight news on the Eastmoney information
Engagement
Investor relations management
platform to maintain its capital market image.
The Company has established and improved its investor relations management system, formulated the Investor Relations
Management Policy, and revised the Rules of Procedure for Shareholders' Meetings, clearly defining responsible parties, workflows,
and channels for shareholder feedback, thereby providing institutional safeguards for equal treatment of all investors and the ○ The Company disclosed a total of 143 compliance information items
protection of minority shareholders' legitimate rights and interests. The Company has also built high-frequency, multi-level interaction through Shanghai Securities News, Securities Times, Securities Daily,
Compliant
mechanisms through diversified channels, continuously enhancing its capital market image and value recognition through efficient and the Shanghai Stock Exchange website, ensuring information is true,
Information
information disclosure and two-way communication. accurate, complete, timely, and fair.
Disclosure
Deepening State-owned Enterprise Reform
The Company closely aligned with the objectives of the concluding year of the SOE reform deepening initiative, fully implementing
reform measures and completing all key tasks. Through dedicated initiatives to improve operational quality and efficiency, the
Company systematically implemented enhancement measures, continuously improving operational efficiency.
In 2025, the Company further deepened market-oriented operating mechanisms, fully implemented differentiated performance
evaluations and incremental incentives under the "one enterprise, one policy" approach, and achieved full coverage of tenure-based
and contract-based management for the management team, effectively stimulating operational vitality. The Company implemented
refined full-process management, actively captured policy incentives to secure special funding support, and steadily advanced capital
structure adjustments and business model innovation for its subsidiaries and investee companies, further optimizing asset structure,
China Association for Public Companies "Visit Listed Companies – "I Am a Shareholder" Investor Education Event: Visit to the Company enhancing market adaptability, and injecting strong momentum into sustainable development.
Baotou Tour" Event: Visit to the Company
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
Strengthening Compliance Impact, risk, and opportunity management
and Risk Prevention Deepening Compliance Management
The Company continued to deepen compliance management by optimizing its quarterly meeting mechanism and launching
The Company improved its integrity and compliance management system, carried out anti-commercial bribery, anti-corruption, and
the "Compliance Officers Speak on Compliance" initiative, with frontline compliance officers serving as speakers to promote
anti-unfair competition initiatives, strengthened internal audit oversight, and established a major risk early warning mechanism,
cross-unit learning; it organized specialized training on compliance system development and operation, along with certification
enabling precise risk identification, dynamic monitoring, and effective response, thereby effectively preventing various operational
programs, to enhance employee awareness; completed compliance effectiveness evaluations for controlled subsidiaries,
and management risks and ensuring compliant and stable operations.
extending compliance management across all levels; and implemented compliance culture promotion programs, including a
Compliance Awareness Week, to foster a strong culture of compliance.
Integrity and Compliant Operations
The Company has established a dual system for risk management and compliance management, clarifying responsibilities and
processes, enhancing compliance guidelines in key areas, strengthening legal management, and fostering a culture of compliance,
embedding integrity and compliance across all aspects of operations.
Governance
The Company has established a Compliance Management Committee and built a compliance framework spanning decision-
making, management, and execution levels, integrating compliance requirements throughout decision-making, management,
execution, and supervision processes. The Party Secretary, Chairman, and General Manager serve as the primary responsible
persons for advancing rule-of-law governance, ensuring top-down implementation of compliance management; the Chief
Compliance Officer, as the core compliance leader, reports directly to the Company's principal executive and oversees the
development and operation of the compliance system; compliance officers are designated across all departments, units, and
wholly owned and controlled subsidiaries to manage and review compliance within their respective areas.
Baogang Steel
Decision-making Level Outcomes
Board of Directors, Board of Supervisors,
and Compliance Management Committee Stronger compliance awareness
Stronger organizational
Upgrading Legal Management
leadership
Management
More robust institutional
Executive Management, Lead Compliance Department, framework
Functional Departments, and Management Units
More e?cient operational Contract Standardization Litigation Risk Management Legal Outreach to Frontline Units
mechanisms
More standardized process The Company fully implemented stand- The Company strengthened stand- In response to training needs and
management ardized contract templates, releasing ardized management of litigation daily legal inquiries from various units,
Execution Level
All units, branches,
More e?ective risk prevention a second batch of 32 templates that cases, conducted targeted analysis the Company conducted one-on-one,
and controlled subsidiaries and control
include clauses on tax rates, integrity, of high-frequency and high-risk areas on-site training sessions, completing
and payment protection for SMEs, im- such as construction projects and programs at three frontline units in
proving contract review and execution labor disputes, and proposed and im- 2025 and effectively improving legal
efficiency. plemented improvement measures. literacy and practical capabilities.
Strategy
The Company has integrated integrity and compliance into its core strategy, establishing a compliance approach of "full
coverage, focused control, and cultural leadership," and is committed to building a long-term mechanism where violations Indicators and targets
are deterred, prevented, and consciously avoided. In 2025, the Company issued the Compliance Management Policy and
Compliance Management System Objectives, revised the Compliance Management Measures, and compiled the Compliance In 2025, the Company fully achieved its integrity and compliance objectives, achieved full coverage of specialized compliance
Management Handbook; it also released specialized compliance guidelines across 12 key areas, including workplace safety, guidelines across 12 key areas, and recorded no major litigation, arbitration, or other risk events. In 2026, the Company
environmental protection, product quality, labor practices, and intellectual property, forming a structured compliance will continue to strengthen its compliance management system, extend compliance requirements across all levels of the
framework of "general principles + detailed rules + guidelines." organization, and maintain a 100% compliance review rate for major matters throughout the year.
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
Anti-bribery and anti-corruption Impact, risk, and opportunity management
The Company treats anti-commercial bribery and anti-corruption as core elements of corporate governance, building an end-to-end Discipline Inspection and Rectification
management approach encompassing strategic leadership, risk control, education, whistleblower protection, partner collaboration,
and zero tolerance, to establish a long-term mechanism that deters, prevents, and eliminates corruption, supporting high-quality The Company adheres to coordinated discipline inspection and inspection mechanisms, strengthens oversight of rectification
development. actions following Party committee inspections, conducts pre-review of rectification plans, tracks implementation progress,
and issues reminders to accountable units and individuals with inadequate corrective actions. In 2025, the Company advanced
multiple rounds of rectification for inspection findings, forming a closed-loop supervision mechanism of "using inspections to
Governance drive rectification, improvement, and governance."
The Company's Discipline Inspection Commission serves as the dedicated body for anti-corruption efforts. In 2025, the Company's
Discipline Inspection Commission implemented supervision system reforms, adding 5 discipline inspectors, establishing third-level
Fostering an Anti-corruption Culture
discipline inspection bodies in 15 units, and assigning 3 full-time discipline inspectors across 3 units. The Company has established The Company further strengthened the integrated approach of positive integrity education and negative case-based warnings.
building, effectively strengthening frontline oversight capabilities. of the Eight-point Regulation, sharing typical cases and conducting integrity talks, as well as organizing visits to the integrity
education exhibition hall and other training activities. At the same time, the Company enhanced communication through
The Company strictly complies The Constitution of the People's Republic of China，The Oversight Law of the People's Republic
platforms such as Baogang Daily and the Discipline Inspection Commission's official WeChat account, fostering an environment
of China，The Regulations of the Communist Party of China on Disciplinary Action , etc. and has advanced the implementation
where corruption is deterred, prevented, and consciously avoided.
of the Integrity Risk Prevention and Control Plan, establishing an anti-corruption system covering three dimensions: integrity in
conduct, employee behavior, and corporate safeguards.
Strategy
The Company uses the Integrity Risk Prevention and Control Plan of Baogang Group as a core tool, dynamically updating risk
registers and control measures to achieve closed-loop risk management. In 2025, the Company supervised and guided all units
to identify 1,307 integrity risks, optimize 245 workflows, revise and improve 292 policies, and resolve 174 issues.
Risk Categories Risk description
Party Committee Conference on Implementing the Spirit of the Eight- Discipline Inspection Commission Work Advancement Meeting and On-
point Regulation and Mid-year Work Conference on Party Conduct and site Exchange on Integrity Risk Prevention
○ Some personnel lack a deep understanding of Xi Jinping Thought on Socialism with Anti-corruption
Ideological and Chinese Characteristics for a New Era, resulting in weak conviction; a diminished sense
Ethical Risks of purpose, with manifestations of formalism and bureaucracy; insufficient awareness
of integrity and self-discipline; and gaps in family conduct and values.
Whistleblower Protection Mechanism
○ In areas such as strategic management, procurement and sales, and engineering The Company has established a four-channel reporting system covering letters, visits, online platforms, and telephone, with
Key Area construction, the complexity and specialization of operations still lead to issues such reporting mailboxes installed across facilities and public disclosure of reporting hotlines and mailing addresses. The Company
Risks as non-standard internal management, insufficient identification of integrity risks, and strictly implements the Measures for Handling Petitions and Reports, clearly defining procedures for acceptance, verification,
inadequate control measures. feedback, and whistleblower protection, prohibiting retaliation, and safeguarding stakeholders' lawful rights to supervision.
○ Influenced by industry "implicit practices" and external factors, Company personnel
face risks of misconduct and commercial bribery in business activities, with ongoing
External
Integrity Governance in the Supply Chain
external pressure on integrity compliance.
Environment Risks
The Company, through the Implementation Measures for the Integrity Agreement, embeds anti-bribery requirements across the
○ Certain regulations governing the exercise of authority remain incomplete, with entire process of supplier onboarding, contract execution, and performance evaluation, and requires business partners to sign
insufficient checks and supervision mechanisms in key processes, leading to
Institutional and
integrity agreements, with clear mechanisms such as termination of cooperation and inclusion on restricted transaction lists for
institutional gaps.
Mechanism Risks
violations, promoting joint integrity governance across the supply chain.
○ Personnel in leadership and critical roles, due to the nature of their positions, may be
Role-related Risks susceptible to influence from related parties, posing risks of non-compliance, inaction,
or abuse of power for personal gain.
Indicators and targets
In 2025, the Company achieved full coverage of anti-corruption training for Party members and employees, with no major
○ Certain business processes remain non-standardized, with incomplete control and
incidents of commercial bribery, corruption, or related violations recorded throughout the year. In 2026, the Company will
supervision loops and gaps in process coordination, creating risks of abuse of
Business Process
Risks
authority for personal gain. achieve full coverage of anti-corruption training for Party members and employees and establish a normalized, long-term
mechanism for anti-bribery and anti-corruption efforts.
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
Anti-unfair competition Comprehensive Risk Management
The Company strictly complies with the Anti-Unfair Competition Law and the Anti-Monopoly Law of the People's Republic of China, The Company has established a four-tier risk management structure of "Board of Directors – Management – Functional Departments
and, with the Anti-Unfair Competition Compliance Guidelines as its core framework, has established a compliance review mechanism – Business Units": the Board and its committees are responsible for risk decision-making and oversight, the General Manager leads
for major decisions to effectively prevent unfair competition and antitrust risks. In 2025, the Company recorded no litigation, major overall risk management, the Legal Affairs Department serves as the central coordinating unit, and each department and business
administrative penalties, or contract terminations arising from unfair competition practices. unit acts as the primary owner of risk management within its scope.
Guided by the Comprehensive Risk Management Measures, the Company implements full-cycle risk management covering
identification, assessment, response, and monitoring, applies tiered oversight of major and critical operational risks, and has
established a reporting mechanism to ensure timely escalation and response to risk events.
Management Measures
○ The Company conducted anti-unfair competition compliance reviews for major decisions, Management Measures
reviewing a total of 244 proposals in 2025, covering capital increases, strategic cooperation, and
major project development.
Compliance
Review ○ The Company carried out risk assessments for joint venture and cooperation projects, ○ The Company has enhanced its compliance risk database, organized departments and units
reviewed strategic and cooperation agreements, and strictly prevented unfair competition Compliance to develop risk inventories for key areas, and clarified compliance responsibilities and process
and monopolistic practices, including false advertising, defamation of business reputation, Risk control lists for critical roles.
concentration of undertakings, and abuse of market dominance.
○ The Company conducted reviews of risk assessment reports for investment projects, providing a
Management
basis for risk-informed investment decision-making.
○ At quarterly meetings, the Company analyzed compliance cases related to bidding and market
Education and competition. ○ The Company established a major risk early warning mechanism, issuing 9 risk alert reports on
Training ○ The Company organized "Chief Compliance Officer on Compliance" sessions, sharing case studies
Risk Early compliance risk events and notifying relevant units to drive corrective actions.
of compliance failures and providing training to unit heads and compliance officers.
Warning
Mechanism ○ The Company issued advisory notices on export-controlled dual-use items in subsidiaries'
international operations to mitigate foreign trade compliance risks.
○ In 2025, the Company completed 122 audit projects, including sub-items, covering economic
performance evaluation, compliance in key areas, non-plan products, operational management,
Conducting
post-investment evaluation, post-construction project evaluation, and final account audits,
Internal Audit
Oversight
achieving full audit coverage.
SDGs Targets
Green Transformation
for a Low-carbon
Future
Integrating green principles to build a low-carbon future. The Company upholds its signature model of "half industrial,
half ecological," embedding ecological stewardship throughout all operations. Aligning with China's dual carbon strategy,
the Company focuses on climate response, energy efficiency, precise emissions control, and full-process environmental
protection, advancing coordinated efforts in energy saving, carbon reduction, pollution control, and ecological enhancement,
driving a high-standard green and low-carbon transformation to build a modern, clean, and environmentally responsible steel
enterprise and contribute to a greener industrial future for a "Beautiful China."
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
Climate Action Risk Category Risk Parameters Potential Impact Response Measures
and Low-carbon Transition ○ Hold meetings on flood prevention
Increasing and cold-weather heating work, es-
To standardize carbon management, enhance carbon governance, and meet carbon market compliance requirements, the Company severity and I n re ce n t y ea rs , the i n crea s i n g
Physical tablish working groups, and distribute
strictly follows the Work Plan for Accelerating the Establishment of a Dual-Control System for Carbon Emissions, the Implementation risks frequency occurrence of extreme weather emergency plans.
Plan for Establishing a Carbon Footprint Management System, and the Detailed Rules for Carbon Management of Baogang (Group) Acute of extreme events globally may lead to tem-
○ The Company strengthens extreme
Company , the "2025 Low-Carbon Energy Work Plan," and other relevant documents. This ensures that every decision and action Risks weather events porary disruptions in raw material
(such as heavy and water supply, thereby affect- weather monitoring, early warning,
taken by the company aligns with the requirements of sustainable development, supports the transition to a green and low-carbon and emergency response capabilities
rain and ing production stability.
economy, and contributes to achieving the goals of carbon peaking and carbon neutrality. snowstorms) to enhance climate resilience across
its facilities, supply chain, and assets.
Governance With increasingly stringent ener-
g y-saving, emissions reduction,
The Board of Directors serves as the highest decision-making body for climate-related matters, reviewing the Company's climate and environmental regulations,
strategy, medium- and long-term emission reduction targets, and carbon neutrality roadmap, and assuming primary responsibility for the implementation of the Interim
climate governance; the General Manager leads a cross-functional climate working group as the executive body, implementing Board Measures for Carbon Emissions
Expansion
Trading has heightened compliance
decisions, developing annual climate action plans, coordinating resources, resolving key implementation issues, and reporting regularly; of carbon
risks for enterprises; the expansion
the Low-carbon Energy Center is designated as the responsible department, managing climate risk assessment, data collection and markets and
of the national carbon market des-
rising carbon
accounting, and establishing a climate data management system to ensure the accuracy, completeness, and reliability of emissions and ignates 2024 as the first compliance
pricing and
related data. year, requiring the Company to par-
costs
ticipate in carbon trading, leading
to increased compliance costs and ○ The Company has established a
exposure to carbon price volatility, Low-carbon Energ y Center with
Strategy thereby raising operating costs and dedicated technical personnel to
impacting strategic development. interpret policies, actively participate
The Company conducts weekly production coordination meetings, energy benchmarking sessions, and quarterly low-carbon energy in industry and regulatory training,
stay informed on carbon market and
meetings to review annual greenhouse gas emissions reports and sustainability reports, hear climate-related research updates, and
CBAM rules, and conduct internal
assess climate risks and opportunities; it also integrates climate-related emissions targets into its "14th Five-Year Plan", annual rolling policy and regulatory training pro-
strategic plans, "three transformations" initiatives, and annual low-carbon energy plans to proactively respond to the expansion of The European Commission has grams.
the national carbon market and the implementation of the EU Carbon Border Adjustment Mechanism. introduced the world's first Carbon
Border Adjustment Mechanism, ○ The Company strengthens carbon
Policies emissions accounting to ensure data
imposing tariffs on carbon-intensive
and
Transition
Carbon Tariff accuracy and reliability.
imports such as steel and cement,
Category Reporting period Response Measures Risks Regulations
which may restrict the Company's ○ T h e C o m pa n y h a s d e v e l o p e d a
exports, increase export costs, and carbon peaking and carbon neutrality
○ By developing annual low-carbon energy plans aligned with the Company's short-term impact revenue. action plan, defining specific targets
strategic scope and energy cost planning; and key tasks for each phase.
Short
Term 1–2 years
○ By establishing monthly low-carbon energy plans aligned with annual strategic and ○ The Company continues to enhance
energy cost plans, while incorporating the impact of maintenance and overhaul its full-process carbon data MRV
schedules for key energy-consuming equipment. (Monitoring, Reporting, and Verifi-
The transition from energy consump-
cation) system to support carbon
tion dual control to carbon emissions
market compliance and internal
dual control is a key national measure
management.
to address climate change and drive
○ By formulating a low-carbon energy development plan for the steel industry during the green economic transformation;
"15th Five-Year Plan" period, analyzing current conditions and challenges, assessing the Shift in "Dual under this policy framework, primary
Medium
Term with Stronger restricted, accelerating the shift
○ By aligning with the Company's long-term strategy and energy cost planning. Carbon toward renewable and low-carbon
Constraints energy, while requiring the Company
to invest in technology development,
technology adoption, and facility
○ By aligning with the Group's carbon peaking and carbon neutrality roadmap and upgrades, resulting in increased
Long 5–10 years
defining a "dual carbon" strategy focused on controlling total emissions and reducing capital and operating costs and
Term and beyond intensity. impacting revenue.
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
Risk Category Risk Parameters Potential Impact Response Measures ○ Regulatory efforts to address excessive competition in the steel industry through measures such as energy
consumption and carbon emissions controls will support a more balanced supply-demand dynamic.
Opportunity
○ The Company conducts research on ○ As the economy and society accelerate the transition to green and low-carbon development, demand for "low-
low-carbon metallurgy and advances emission steel" and "green steel" is rapidly increasing across multiple steel-consuming sectors.
To align with national "dual car- technologies such as waste heat and
bon" goals and achieve its own energy recovery, replacement of high-
targets, the Company will need to energy-consuming equipment, process The Company is developing a systematic climate transition pathway, aligning carbon peaking and carbon neutrality targets with its
Low-carbon upgrades, intelligent scheduling, and
invest significant resources in the medium- and long-term strategies, while advancing energy structure optimization, technological upgrades, and carbon management
Technology integrated water conservation.
Transition
development and application of capability building. Against the backdrop of deepening national "dual carbon" policies, improving carbon market mechanisms, and
low-carbon metallurgical technolo- ○ Focusing on energy efficiency improve- continuous advances in green technologies, the Company is strengthening organizational support, optimizing resource allocation,
gies, which remain at an early stage ment, fuel mix optimization, CCUS, and enhancing digital capabilities to drive orderly implementation of transition initiatives and achieve phased progress.
and carry considerable uncertainty. and green products, the Company is
developing a deep decarbonization
Technology pathway for the steel industry.
and Cost
Impact, risk, and opportunity management
○ The Company optimizes resource allo-
During the low-carbon transition, cation to reduce long-term operating
costs.
Strengthening Carbon Emissions Management
increased investment in ener-
gy-saving, environmental protec-
Transition ○ The Company actively seeks policy To enhance carbon management, the Company has established a carbon data quality control system, defining accounting
tion, and low-carbon smelting
Costs support. boundaries at both enterprise and process levels; it conducts monthly accounting and record-keeping, prepares annual
technologies may lead to higher
costs and potential impairment of ○ The Company promotes technological reports, supports government verification, and fulfills compliance obligations; in accordance with regulatory requirements of
existing fixed assets. innovation to reduce the cost of low- the Ministry of Ecology and Environment's "Notice on Carrying Out Relevant Work for the National Carbon Emission Trading
carbon technologies. Market in 2025," it has consolidated carbon emission entities into a unified key emission entity for centralized management;
and it regularly reviews carbon management system implementation and certification progress, assigning corrective actions for
identified issues.
Driven by the global trend toward In 2025
Transition Growing green and low-carbon develop-
Demand for
the Company completed its 2024 carbon quota compliance obligations on schedule,
Risks ment, demand for low-carbon steel ○ The Company advances research on
Green and products is expected to continue
with no cases requiring regulatory rectification or investigation.
low-emission steel and promotes EPD
Low-carbon rising, intensifying industry com- certification.
Products petition; a slower transition may
result in loss of market share.
Market
○ The Company optimizes procurement
Energy and resource prices are strategies to reduce reliance on single
Rising Raw likely to increase due to climate-re- sources.
Material and lated impacts, driving up procure-
Fuel Costs ment costs for raw materials and ○ The Company invests in R&D and
fuels and increasing cost risks. process improvements to enhance raw
material utilization efficiency.
Carbon Management System Construction and Certification Launch On-site Investigation for Carbon Management System Construction
Meeting
Investors, stakeholders, and the
public are placing increasing focus ○ The Company proactively addresses
Stakeholder stakeholder concerns and enhances
on the Company's climate actions,
Expectations
which may become a key perfor- transparency. Advancing Steel Product Certification
Reputation on Climate
mance indicator and pose repu- ○ The Company engages in public
Action
tational risks, requiring additional The Company completed EPD recertification for cold-rolled steel sheets and strips produced by the rare earth steel cold rolling
awareness initiatives to build broader
investment in carbon management recognition. mill and hot-rolled reinforcing bars (ribbed and plain) from the long products mill; it also obtained CFP certification for H-beams,
to meet expectations. hot-dip galvanized coils, and non-oriented electrical steel. As of the end of 2025, the Company had published 7 EPD and 4 CFP
reports, covering core products such as plates, pipes, rails, and wire, expanding its green product portfolio and strengthening
the foundation for increasing market share.
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
Developing Carbon Management Talent Resource Circularity
The Company delivers systematic training on carbon knowledge, carbon quota management, and practical implementation,
strengthening policy communication and capability building to integrate carbon management across operations; in
with Efficiency at the Core
collaboration with authoritative institutions such as China Classification Society, it provides precise interpretation of domestic The Company is comprehensively building itself into a resource-conserving and environmentally friendly steel enterprise. Through
carbon regulations, industry standards, and accounting requirements, enhancing employees' capabilities in carbon asset ultimate energy efficiency and intelligent upgrading, it enhances energy utilization efficiency and the share of clean energy use,
management, emissions accounting, and compliance to support high-quality, low-carbon development. strengthens water recycling and reuse, and remains firmly committed to a green and low-carbon development path featuring
ecological priority and conservation- and intensive-use orientation.
Energy utilization
The Company strictly complies with the Energy Law of the People's Republic of China , the Limits of Energy Consumption per
Unit Product for Major Processes of Crude Steel Production, and other applicable legal requirements. It has formulated energy
management and assessment systems such as the Measures for Energy Management Assessment of Baogang Steel and the 2025 Low-
carbon Energy Work Plan of Baogang Steel, established a full-process carbon metering and traceability system, and participated in
Carbon Knowledge Training Study on Latest Carbon-Related Laws, Regulations and Policies
the assessment and acceptance of the Best-Practice Energy Efficiency Benchmark Demonstration Enterprise for Carbon Peaking and
Carbon Neutrality. It has achieved full compliance with regulatory requirements for the installation coverage and accuracy of Class
I, Class II and Class III energy measuring instruments. As of the end of 2025, Baogang Steel and all its subsidiaries had established
an energy management system compliant with the national standard GB/T 23331 and had obtained third-party certification of the
Indicators and targets energy management system.
Indicator
Governance
The Company conducts emissions accounting in strict accordance with the Guidelines for Enterprise Greenhouse Gas Emissions
Accounting and Reporting, including defined accounting boundaries, emission sources, data acquisition principles, and default In line with the principle of "clear accountability, full horizontal coverage, end-to-end vertical management, and systematic
parameter values.The covered greenhouse gas category is carbon dioxide, and the calculation scope only includes Scope 1 and control", The Company has established a five-tier vertical management structure covering teams, sections, workshops (operation
Scope 2, while Scope 3 is not included in the statistical accounting. In 2025, carbon dioxide emissions per ton of steel decreased divisions), plants/mines, and Baogang Steel at the corporate level. Horizontally, it spans eight processes: mining, ore dressing,
by more than 2% year-on-year. coking, sintering (pelletizing), blast furnace ironmaking, steelmaking, rolling, and utilities & auxiliary power, thereby forming a
five-tier vertical and eight-process horizontal management matrix for energy management.
Scope 1 Greenhouse Gas Scope 2 Greenhouse Gas Total Emissions “Five-tier Vertical and Eight-process Horizontal” Management Network
Emissions Reduction Emissions Reduction for Scope 1 + Scope 2
Baogang
Targets Workshop Plant/Mine Steel
Section (Operation
Team Division)
Short term Medium term Long term
(1–2 years) (3–5 years) (beyond 5
years)
Mining ? Ore Dressing ? Coking ? Sintering (Pelletizing) ? Blast Furnace ? Steelmaking ? Rolling ? Utilities & Auxiliary Power
Carbon intensity to decrease by 2–4% Carbon intensity todecline by 2%–6%, Strive to achieve carbon neutrality
year on year, subject to verification by subject to verification by government- before 2060. Clear accountability, full horizontal coverage, end-to-end vertical management, and systematic control
government-designated third-party designated third-party institutions.
institutions.
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
Strategy Use clean energy
The Company has actively deployed clean energy through projects such as photovoltaic power generation and solar street lighting,
Risks Response Measures promoting the integration of clean energy throughout the production process. It has successfully developed product series including
steel for hydropower and steel for wind power, providing solid material support for energy structure transformation and the dual-
○ Promote energy-saving technologies and equipment to reduce energy consumption; carbon goals through the superior performance of green products. It has also actively participated in the green electricity trading
Low energy utilization market, continuously increasing the share of purchased electricity obtained through green power trading and effectively reducing
○ Strengthen energy-saving awareness to reduce energy waste.
efficiency total carbon emissions. As of the end of 2025, the Company had rooftop photovoltaic power generation projects with a total installed
capacity of 41.45 MW and annual power generation of 42.61 million kWh, with the share of clean energy use reaching 0.51%. Its total
○ The Company optimizes resource allocation to reduce long-term operating costs; green electricity trading volume reached 558 million kWh, and the proportion of green electricity trading reached 15.17%.
Rising transition costs ○ Strive for policy support and secure government subsidies;
○ The Company promotes technological innovation to reduce the cost of low-carbon
technologies.
Impact, Risk and Opportunity Management
Closely aligned with China's dual-carbon goals and the autonomous region's requirements for green, low-carbon and high-
quality development, The Company has advanced energy mix adjustment and energy efficiency improvement in a coordinated
manner, promoted a new green development pattern featuring more efficient resource utilization and lower-carbon energy Photovoltaic power generation project at the Rare-earth Steel Cold- The Company's steel for wind power products supporting the "Xinjiang
consumption, and systematically strengthened its green competitiveness. rolled Sheet Plant Power Transmission to Chongqing" new energy strategy
Improving Utilization Efficiency Indicators and targets
Guided by ultimate energy efficiency, The Company has strengthened specialized energy management and enhanced its cost
reduction capability through low-carbon energy. It has formulated the Acceptance Work Plan for Baogang Steel's Best-Practice Energy Indicators
Efficiency Benchmark Demonstration Plant for the Dual-carbon Goals to consolidate the foundation for refined energy-efficiency
operations. Taking the metering system as the core lever, it has established a full-process energy metering and control mechanism
and advanced the smart upgrading of energy metering equipment. It has also steadily promoted energy saving and carbon reduction Renewable energy consumption Share of renewable energy consumption
in key processes, strengthened precise gas dispatching, waste heat recovery management, specialized electricity-use management,
and specialized oxygen management, restructured energy utilization processes, and unlocked energy-efficiency potential through
targeted retrofits. In 2025, the Company's comprehensive energy consumption per tonne of steel was 623.72 tonnes of standard coal
equivalent per tonne of crude steel, down 0.86% year on year. Self-generated electricity reached 6.853 billion kWh, an increase of 306
million kWh year on year, correspondingly reducing purchased electricity cost by RMB 135 million.
Targets
In accordance with the 15th Five-Year Plan, the Company will advance energy projects and the
development of Baogang Steel's digital platform for energy and carbon management and control,
The Rare-earth Steel Plate Company of striving to reduce comprehensive energy consumption per tonne of steel by 5% by the end of the 15th
Baogang Steel successfully passed the Five-Year Plan period as compared with the end of the 14th Five-Year Plan period.
ultimate energy-efficiency acceptance by the
China Iron and Steel Association for its full- It will continue to carry out projects such as the high-efficiency spherical steam heat accumulator
process operations, Coke Ovens No. 5-10, technology for the steel plant, steam balancing and regulation technology in steelmaking, and blower
and Blast Furnaces No. 4 and No. 6. The efficiency enhancement retrofit at the ironmaking plant, so as to further improve energy utilization
proportions of blast furnace, converter, efficiency.
and coke oven capacity reaching
benchmark level were 70%, 32%, and 100%,
respectively, exceeding the target of having 30%
of capacity reach advanced levels during the
Throughout the entire process of production and operational water use, The Company consistently adheres to the principles of
conservation first and balance between water abstraction and supply. It continues to improve its water resources management
Diameter expansion retrofit of the blast-furnace gas interconnection
pipeline at the Utilities and Power Supply General Plant realized near- system, carry out water-saving technical retrofits, strengthen water-saving awareness among all employees, and enhance the
zero venting of blast-furnace gas and coke-oven gas. intensive and efficient use of water resources.
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
Governance Indicators and targets
The Company has established a Water Resources Management Committee. The Secretary of the Party Committee and Chairman Indicators
serves as Director; Company executives in charge serve as Deputy Directors; and the manager of the Low-carbon Energy Center,
together with leaders in charge from relevant functional departments and units, serve as members. The office is set up within
the Low-carbon Energy Center, with a deputy manager serving as Director of the Office and a senior executive of the Low-carbon Total water consumption Recirculating water volume Water reuse rate
Energy Center serving as Deputy Director of the Office. In 2025, The Company was awarded the title of "2025 Water-saving
Enterprise of Baotou City". 2,614,844,000 m? 2,562,830,700 m? 98.01 %
Strategy
Risks Response Measures Targets
By 2029, the Company plans to save 1.5 million m? of water, raise the water reuse rate to 98.05%,
○ instrument inspections shall be carried out for existing projects
increase the concentration ratio of circulating water to 3.0-4.0, and carry out measures including the
For entities whose water abstraction reaches
the prescribed threshold but that have not as well as new, renovated and expanded projects to ensure
installed online metering facilities, or whose compliance with the equipping and management requirements of repair of inefficient cooling towers, water-saving and plume-abatement retrofit of 62 cooling towers,
online metering facilities are unqualified or GB/T 24789-2022 General Rules for Equipping and Managing of the and remediation of direct discharge from steam traps.
not operating properly, Water Measuring Instrument in Water-use Organization.
For water-use entities whose unit water ○ priority shall be given to the use of unconventional water and
consumption of products exceeds the cascading water use; monitoring of water quantity and water
mandatory water-use quota and that have quality at each water-use link shall be strengthened; tiered water
not implemented water-saving technical
retrofits within the prescribed timeframe,
use and recirculating water use shall be enhanced; and water-
saving retrofits of water-use facilities shall be carried out.
Cleaner Production
and Pollution Prevention and Control
Impact, risk, and opportunity management The Company continues to consolidate the foundation of its environmental management system and improve its full-process
environmental control mechanism. It standardizes emissions management, strengthens control over pollutant discharge
The Company strictly follows the Water Law of the People's Republic of China , the Regulations on Groundwater Management, to ensure compliance, improves the system for classification, recycling and harmless disposal, and promotes the efficient
the Measures for the Administration of Water Abstraction Permits, and other relevant regulations. It has formulated the Measures circular use of resources. Through multiple measures, it reinforces the green development safeguard and supports the green
for Water Resources Management of Baogang Steel to comprehensively manage compliant water use, precise metering, water transformation of the industry.
conservation, and strict drainage. It has established a Water Resources Inspection Team to conduct special inspections on the
implementation of the 2025 Water-saving Action Plan of Baogang Steel. It has deepened whole-chain metering management
of water resources and established a metering-based settlement management mechanism. It has also carried out retrofits of
outdated water treatment processes and water-saving and plume-abatement retrofit of cooling towers; implemented water
recovery and reuse projects involving rainwater, seepage water, condensate, office water, and tailings pond return water;
improved the water recycling treatment system; and developed unconventional water sources to expand water supply channels.
Strengthening Environmental Management
In 2025, Baogang Steel used 52.2852 million m? of surface water and approximately 128,046 m? of groundwater, and discharged
The Company continues to improve its environmental management system, precisely identify and proactively prevent
various environmental risks, comprehensively strengthen its environmental emergency preparedness capability, and carry
Company's history.
out regular communication and implementation of environmental policies and environmental skills training, thereby
safeguarding the Company's green, low-carbon, high-quality and sustainable development with robust environmental
governance capabilities.
Governance
The Company has one Assistant General Manager in charge of environmental protection, while the Manufacturing Department
coordinates specialized environmental management. Within the Manufacturing Department, there is one department head, one
Environmental Protection Director, one head of the Environmental Management Office module, and 17 professional technical
staff members responsible for atmospheric emissions, wastewater, general industrial solid waste and hazardous waste, pollutant
discharge permits, environmental emergency response, plant appearance, and related matters. In addition, 37 environmental
Barun Mining Branch implemented high-efficiency tailings pond The Coal Coking and Chemical Branch carried out a project for
return water. advanced treatment and reuse of phenol-cyanide wastewater.
management personnel are assigned across secondary units, forming a professional and standardized management team.
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
○ Routine reporting: Frontline operators report daily on the operation of environmental protection Strengthening Environmental Emergency Response
facilities, pollutant discharges, and hidden-risk inspections. Environmental officers in workshops
report environmental ledgers on a daily basis. The Manufacturing Department regularly reports The Company's emergency response plan system for environmental emergencies is built around the core principles of "prevention
first and rapid response". It identifies environmental impact factors such as waste gas, wastewater, and hazardous waste throughout
Information
Reporting emissions data and compliance risks to the management team.
the full process and assesses risk levels. It conducts regular inspections of key risk points, including gas holders, hazardous chemicals
○ Periodic reporting: The Manufacturing Department prepares the pollutant discharge permit
Mechanism
warehouses, and sewage ponds, rectifies hidden hazards, and ensures that facilities such as emergency ponds and containment
implementation report, quarterly and annual environmental statistics reports, and environmental tax
bunds remain in good condition. For potential leakage, fire, or excessive discharge incidents, the Company has established a graded
filing data, submits them as required, and discloses them to the public.
emergency response mechanism and implemented measures including source isolation, pollution interception (such as switching
rainwater and sewage valves), and personnel evacuation. It also regularly stocks emergency supplies, organizes rescue teams, and
○ Internal supervision: The Manufacturing Department takes the lead in conducting routine supervision, conducts drills to ensure that pollution can be effectively controlled and escalation prevented when incidents occur.
special supervision, and management system reviews, and has established a mechanism for issue
notification and corrective action tracking.
Supervision
and Implementing Environmental Monitoring
Management ○ External supervision: The Company accepts supervision and inspection by ecological environment
authorities, environmental inspections, and online data verification, and proactively accepts public The Company has established a three-tier environmental monitoring system consisting of automatic monitoring, third-party
oversight and responds to complaints in a timely manner. monitoring, and government supervisory monitoring. It has formulated the Measures for Quality Management of Monitoring Data of
Baogang Steel and the Annual Environmental Monitoring Plan of Baogang Steel to comprehensively ensure full coverage, traceability,
and standardization of environmental control data monitoring.
○ Monthly assessments are implemented, and the results are directly linked to employee compensation.
○ For environmental violations, the Company imposes penalties such as circulated criticism, Automatic monitoring Third-party monitoring Government supervisory monitoring
Assessment and performance-based pay deductions, and accountability measures depending on the specific
Accountability circumstances. Automatic monitoring is installed The Company engages third-party institutions The Company cooperates with ecological
Management at major emission outlets, with CMA-accredited qualification to carry environment authorities in carrying out
○ Where environmental pollution incidents are caused, legal liability shall be pursued in accordance with dedicated personnel and out full-factor manual monitoring of general unscheduled spot-check monitoring
with law. equipment assigned to conduct emission outlets at the required frequency. and online data verification, and accepts
routine sampling, analysis, and Comparative monitoring of automatic supervision and guidance from competent
data reporting. monitoring equipment is conducted once every industry authorities.
Strategy quarter to verify the accuracy of automatic
monitoring data.
The Company identifies risks such as pollutant discharge, hazardous waste disposal, and noise pollution, as well as opportunities
including energy saving, cost reduction, and technological innovation, by combining internal information collection with external
information tracking. It then prioritizes such risks and opportunities based on compliance and formulates environmental risk Fostering an Environmental Protection Culture
prevention and control mechanisms and response measures accordingly.
Taking World Environment Day (June 5) as an opportunity, the Company
has carried out in-depth publicity and education activities on laws
and regulations concerning ecological and environmental protection,
Risk Opportunity
Response Implementation environmental protection knowledge, advanced environmental
management concepts, and exemplary environmental cases. It actively
communicates the Company's ecological civilization story, fully
demonstrates the achievements made in creating ultra-low emissions
○ For risks of the highest priority, special rectification ○ Opportunities of the highest priority are included in
and a Class A environmental performance enterprise, enhances
teams are established, and issues are addressed the annual investment plan for implementation.
within a specified time limit under a "one plan for ecological civilization awareness among all employees, and builds a Baiyun Ore Dressing Branch conducted a 2025 lecture on
○ For high- and medium-priority opportunities, project sound ecological civilization image for the Company. environmental protection knowledge training.
each risk" approach.
reserves are established and progress is dynamically
○ For high- and medium-priority risks, the responsible tracked.
departments take the lead and work with relevant Indicators and targets
○ For potential opportunities, the Company cooperates
departments to advance rectification.
with external institutions to carry out technical
In 2025, the Company continued to improve its environmental protection management systems, strengthened the management
○ General risks are incorporated into routine management research and breakthroughs.
of pollutant discharge permits and environmental emergency incidents, enhanced publicity, training and education on
for ongoing optimization.
ecological civilization, and refined the management of retired environmental protection equipment and facilities. Throughout
the year, all pollutants were discharged in compliance with applicable standards. No environmental incidents or environmental
administrative penalty cases occurred, and the Company achieved its established targets.
Impact, risk, and opportunity management 2025
On the basis of compliance with the Environmental Protection Law of the People's Republic of China, the Company has formulated
Environmental
protection investment 35.5 RMB 100 million
Percentage of sites covered by
environmental risk assessment 100 %
Risk Control of Environmental Aspects and Hazard Sources, and successfully passed the surveillance / recertification audit of
the environmental management system, thereby ensuring the scientific basis and effectiveness of its environmental compliance
management.
Percentage of sites certified under the ISO
Training coverage rate for employees
engaged in environmental-related work 100 %
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
Emissions Management Waste disposal
The Company strictly complies with the Law of the People's Republic of China on the Prevention and Control of Atmospheric The Company continues to strengthen full-process management of waste classification, collection, storage, and recycling. It
Pollution, the Law of the People's Republic of China on the Prevention and Control of Water Pollution, the Law of the People's vigorously promotes the harmless and resource-based treatment of waste, effectively reduces resource waste, and minimizes the
Republic of China on the Prevention and Control of Noise Pollution , and other applicable laws and regulations. In accordance with adverse environmental impacts of waste generated during production and operations, thereby achieving low-carbon and sustainable
policy requirements such as the Emission Standards of Air Pollutants for the Steel Industry (Steelmaking) and the Emission Standards development.
of Air Pollutants for the Steel Industry (Rolling), the Company has steadily advanced ecological and environmental risk prevention and
control, consolidated the achievements of ultra-low emissions transformation and Class A environmental performance enterprise
designation, and implemented ten environmental governance projects, including the treatment of fugitive dust emission sources
Governance
in the pellet production line of Guyang mine. It has strengthened the supervision of pollution control facilities, with both the data The Manufacturing Department is responsible for the unified management, allocation, and recycling of the "three wastes"
transmission rate and disclosure rate of the automatic pollution-source monitoring system reaching 100%. In 2025, emissions (wastewater, waste gas, and solid waste) generated by departments and their subordinate production lines. This includes the
per tonne of steel of sulfur dioxide, nitrogen oxides, and particulate matter decreased by 3.7%, 9.52%, and 11.11% year on year, management of general industrial solid waste, hazardous waste, and the resource utilization of wastewater and waste gas. At
respectively. The number of days with good air quality in the region increased by 5.5% compared with the previous year, and air the same time, the Company is subject to unified management and assessment by the Group.
quality in surrounding communities continued to improve.
Strategy
○ Core processes such as sintering machines, blast furnaces, and converters are equipped with high-
The Company has established an Environmental Protection Committee to oversee waste-related management activities. Each unit's
efficiency bag filters and desulfurization and denitrification facilities. Waste gas is treated and then
Environmental Protection Committee conducts identification and evaluation of risks and opportunities within the organization
Air Pollution
Control discharged in compliance through exhaust stacks.
every six months. The Company-level environmental risk and opportunity identification and evaluation team analyzes, reviews, and
○ Raw material stockyards and transportation roads adopt enclosed management plus spray dust determines the Company's risk and opportunity control list. For risks included in the list, response measures are formulated based
suppression to strictly control fugitive emissions.
on actual conditions.
Risk Categories Detailed Description
○ All production wastewater is collected into the Company's central discharge system. After purification
Wastewater through a "conventional treatment system plus advanced treatment system", most of the treated water is If waste treatment practices fail to comply with the Law of the People's Republic of China on the
Treatment recycled, while a small amount of compliant treated effluent is discharged to the terminal receiving water Compliance Prevention and Control of Environmental Pollution by Solid Waste, the National Catalogue of Hazardous
project. Risks Wastes, and other relevant laws and regulations, the Company may face administrative penalties,
production suspension for rectification, or even criminal liability.
Environmental Waste leakage or improper disposal may cause soil, water, and atmospheric pollution, leading to
ecological damage and harming the health of surrounding residents.
○ High-noise sources are equipped with sound barriers and silencers to reduce external noise impacts.
Risks
Noise Control
The cost of compliant disposal (such as hazardous waste transportation and professional incineration/
landfill) may increase; compensation and remediation costs arising from pollution incidents may impose
Financial
additional financial burdens on the Company.
Risks
Air Emissions Management Targets and Plans Reputational Exposure of waste pollution incidents may trigger a public trust crisis, damage brand image, and lead to
Risks customer loss and reduced cooperation opportunities.
In 2025, the Company ensured that total pollutant In 2026, the Company aims to reduce pollutant emissions
emissions did not exceed the permitted discharge limits. such that particulate matter emissions are less than 0.38 Supply Penalties imposed on upstream suppliers or downstream customers due to their own waste management
issues may affect the Company's raw material supply or product sales.
No incidents of resident health damage caused by the kg per tonne of steel, sulfur dioxide emissions are less than
Chain Risks
Company's emissions occurred, and no related group 0.30 kg per tonne of steel, and nitrogen oxides emissions
complaints were reported. are less than 0.60 kg per tonne of steel.
Types of Opportunities Detailed Description
Policy Participation in government green procurement, enjoyment of environmental tax incentives (such as tax
Opportunities rebates for comprehensive resource utilization), and access to subsidies for ecological restoration projects.
Market Development of "zero-waste" production processes and launch of low-carbon and environmentally
Opportunities friendly products to attract ESG-focused investors and enhance market competitiveness.
Development of waste resource utilization technologies (such as producing building materials from
industrial solid waste and generating biogas from kitchen waste), creating new business growth points
Technological
and even providing external technical services.
Opportunities
Brand Obtaining ISO 14001 environmental management system certification and issuing sustainability reports to
Opportunities build a "responsible enterprise" image and enhance investor and consumer trust.
Supply Chain Synergy Promoting the co-construction of a green supply chain among upstream and downstream enterprises.
Coking coal pulverizer Baghouse dust collector
Opportunities
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
Impact, risk, and opportunity management Ecological Restoration
The Company strictly implements standardized management of solid waste and compliant disposal of hazardous waste in
accordance with the Law of the People's Republic of China on the Prevention and Control of Environmental Pollution by and Harmonious Coexistence
Solid Waste , the Solid Waste Pollution Prevention and Control Management Measures of Baogang (Group) Company, and the
Solid Waste Pollution Prevention and Control Management Measures of Inner Mongolia Baotou Steel Union Co., Ltd., thereby The Company attaches great importance to ecological and environmental protection. It deeply integrates the concept of green
promoting the achievement of the goals of reduction, resource recovery, and harmless treatment of waste. development into daily office operations, plant environment improvement, and green mine construction, systematically
enhancing the diversity, stability, and sustainability of ecosystems, and achieving harmonious coexistence between corporate
development and the ecological environment.
Hazardous
Solid Waste
Waste
Management
Management
Promoting Green Office Practices
In its daily office operations, The Company actively advocates a green and environmentally friendly culture by reasonably controlling
○ Optimize processing and treatment methods for solid ○ Formulate hazardous waste management systems and
air-conditioning temperatures, using energy-saving lighting and high-efficiency office equipment, promoting electronic documents,
waste and adjust product structures. establish comprehensive hazardous waste management
ledgers. electronic signatures, online approval systems, and video conferencing, and encouraging employees to use public transportation for
○ Expand external sales channels for solid waste green commuting. These efforts help foster a sustainable culture with full employee participation.
products and establish a direct sales system for slag ○ Entrust qualified third-party institutions, sign formal
with surrounding cement plants. disposal agreements, and strictly implement the
hazardous waste transfer manifest system during
○ Explore new pathways for solid waste utilization, Building Green Factories
transportation. Hazardous waste is transported using
including deep utilization projects for desulfurization
dedicated enclosed vehicles to ensure full-process The Company actively leverages the foundational and guiding role
gypsum.
traceability from generation to disposal.
of green factories in the green and low-carbon transformation of the
manufacturing industry. It has formulated the 2025 Plant Environment
Improvement Project Task List of Baogang Steel and carried out plant
environment improvement initiatives, including greening and hardening
open material yards, roads, and surrounding areas, as well as repairing
and illuminating plant fa?ades and other structures, thereby cultivating
a green natural landscape within the plant area. In 2025, the green
coverage rate of the Company's plant area reached 50.1%. Greening around newly built material yards at the Ironmaking Plant
Developing Green Mines
In accordance with the requirements of the Announcement on Adjusting the Capacity Replacement Plan for the Upgrade and Retrofit
Project of Certain Converter Equipment of Baotou Iron and Steel (Group) Co., Ltd., The Company has strictly carried out shutdown
and withdrawal within ecological conservation red lines. It has actively rectified environmental risks and hidden hazards identified
in tailings pond inspections and conducted thorough investigations of such risks. During production and project construction, the
For dust-collection ash without direct utilization value, fully enclosed Through systematic processes, desulfurization waste liquid is converted
Company places strong emphasis on biodiversity conservation, minimizes the impact of resource development on vegetation and
collection and transportation is carried out using suction and discharge into ammonium thiocyanate products, achieving resource utilization of
tank trucks. waste.
animal habitats, and carries out ecological restoration and land reclamation and revegetation in mining areas, thereby improving
the rate of mine rehabilitation and restoration.
Indicators and targets Ecological Restoration of the Waste Dump at the West Mine of Baiyun Obo Iron Mine
In 2025, 100% compliant disposal was achieved across all stages of solid waste generation, transportation, storage, treatment, In 2025, the West Mine of Baiyun Obo Iron Mine adopted a site-specific
and utilization. The comprehensive utilization rate of bulk solid waste reached 97.5% (excluding tailings), achieving the technical approach of "engineering measures as support and biological
established targets. In 2026, the Company will continue to achieve 100% compliant disposal across all stages, and the measures as the main approach". Engineering measures were used to
comprehensive utilization rate of bulk solid waste will be maintained at 97.5% (excluding tailings). stabilize the structure, while biological measures addressed the root
causes. Restoration measures included slope topsoiling and reshaping, soil
Caragana and Amorpha fruticosa, as well as grasses such as ryegrass and
crested wheatgrass, were planted to prevent soil erosion and restore the
Total waste generated Recycled amount of general waste Recycled amount of hazardous waste
original ecological functions to the greatest extent possible. Approximately
SDGs Targets
Innovation Engine
Driving Value
Enhancement
Empowered by intelligent innovation, embarking on a new journey; driven by quality and efficiency, composing a new
chapter. The Company actively practices the concept of high-quality development, focusing on the goal of industrial
modernization. It has established a sci-tech innovation and digital-intelligence management system covering the entire value
chain, promoting quality and efficiency improvements across R&D, production, and supply chain processes. It is committed
to building a modern enterprise characterized by innovation leadership, intelligent efficiency, outstanding quality, and
strong responsibility, thereby injecting strong momentum into high-quality industrial development and fostering a mutually
beneficial and trustworthy industrial ecosystem.
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
R&D Breakthroughs Strengthening the Foundation for Innovation
The Company continues to strengthen the
and "Rare" Product Innovation construction of scientific research platforms
and improve its research system. Leveraging
The Company actively responds to the national and Inner Mongolia Autonomous Region strategies of "innovation-driven academicians' workstations, it carries out
development". Guided by technological innovation and advancement, it vigorously promotes innovation in organizational core technology research and establishes a
mechanisms, continuously stimulates the vitality of research entities, and accelerates the development of an innovation-driven metallurgical performance research system
Baogang, making technological innovation the core driving force of corporate development. tailored to the smelting characteristics of
the Baiyun Obo Mine. In 2025, the Company
owned or co-established two national-level
research platforms, one provincial-level
Governance platform, and two academician workstations.
The Company's achievements in "Key Technologies and Applications for Digital
It was also recognized as a high-tech enterprise
The Company has established a Science and Technology Management Committee, led by Company management, as the decision- Intelligent Control Throughout the Seamless Steel Pipe Manufacturing Process" and
in the fifth batch of 2025 in Inner Mongolia
"R&D and Industrial Application of Rare-earth High-strength Steel Plates for Special
making body for science and technology management. The Committee is responsible for defining innovation strategies, approving Autonomous Region, further consolidating Vehicles" won the Second Prize of the Science and Technology Progress Award of
plans and projects, coordinating resource allocation, overseeing the full R&D process, reviewing funding and talent outcomes, and platform support and qualification assurance Inner Mongolia Autonomous Region.
recognizing outstanding innovation achievements, thereby ensuring compliant and efficient advancement of innovation activities. for innovation and R&D.
At the same time, the Company has issued management notices, revised and compiled the Implementation Rules for Technical Research
Procurement Management of Baogang Steel, and issued the Notice on Further Adjusting and Optimizing Management Authority of
Research Institutes. It has delegated authority in personnel, procurement, and funding, implemented diversified incentive mechanisms,
optimized talent evaluation systems, established an industry-university-research collaborative R&D model, and built a rigid growth Tackling Core Technologies
mechanism for R&D investment, thereby stimulating innovation vitality and driving high-quality development through innovation.
Focusing on the two core processes of ironmaking and steelmaking, The Company has optimized process parameters and
achieved breakthroughs in key technologies, with the objectives of cost reduction, quality improvement, and low-carbon
development, thereby realizing process upgrades and efficiency gains.
Strategy
Ironmaking
Risks Risk description Response Measures
○ Actively advanced the implementation of academician workstation projects and proposed targeted measures to reduce the
○ Strengthen feasibility studies and assessments prior to reduction swelling index of Baiyun Obo iron ore pellets, reducing the index of belt-roasted pellets from 18% to below 17%.
R&D to comprehensively analyze technical challenges
○ New technology development may en- ○ Established a method for testing metallurgical properties of integrated blast-furnace burden adapted to the alkali metal
and potential risks.
counter technical challenges that can- and fluorine circulation conditions of Baogang blast furnaces, determining optimal process parameters and effectively
not be overcome or may fail to achieve ○ Establish backup technical solutions to enable timely
Technical
reducing the blast furnace fuel rate.
expected results due to technological switching or adjustment when issues arise.
Risks
immaturity. ○ Completed a pilot production line for coal-based colloidal binder preparation and conducted industrial trials partially
○ Continuously track technological development trends replacing bentonite, achieving the substitution of 1.0% bentonite with 0.1% coal-based binder while maintaining stable
and introduce external technological resources. pellet quality.
○ Continued experimental research on cost-effective iron ore, promoting the application of new ore types such as Indian
○ Inaccurate forecasting of market demand ○ Strengthen market research to improve forecasting ore fines, reducing blending costs by over RMB 50 million in 2025.
for new technologies and products may accuracy. ○ Completed industrial trials of direct reduction of Baiyun Obo ore using a pure hydrogen shaft furnace, verifying the
hinder the conversion of innovation feasibility of producing direct reduced iron with a metallization rate above 94% from pellets with TFe content of 62%–
○ Formulate diversified market strategies to reduce
achievement into actual value. 63%, laying a foundation for hydrogen metallurgy projects.
Market dependence on a single market.
○ Competitors may launch similar or more
○ Adjust innovation direction and product functions in a
advanced technologies and products
Risks
timely manner based on market changes to enhance Steelmaking
more quickly, capturing market share.
market adaptability.
○ Developed a mold wire-feeding process to enable production of steel with high rare-earth content.
○ Innovated the rare-earth ferrosilicon deoxidation process to promote balanced utilization of rare-earth resources; through
process optimization measures such as eliminating calcium treatment, achieved cost savings of nearly RMB 10 million.
Impact, risk, and opportunity management
○ Introduced a smart converter steelmaking system, with AI-based modeling data collection accounting for over 50% of
Relying on the resource advantages of the Baiyun Obo Mine, The Company focuses on the core field of rare-earth steel. It total production data, initially establishing an AI-enabled smart steelmaking platform.
systematically advances scientific research, application and commercialization, innovation cooperation, and intellectual property ○ Developed and applied a steelmaking process with a high scrap ratio in long processes, formulated four production
protection. During the year, it achieved breakthroughs in multiple core technologies, developed a number of high-end new control standards for low-carbon-emission steel, and obtained Kingfisher Certification for green steel products with 20%
products, strengthened industry-university-research collaboration, and realized dual improvements in technological innovation and 50% high scrap ratios, as well as certification for low-carbon-emission hot-rolled coil, significantly enhancing the
and production efficiency. market competitiveness of green steel products.
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
Protecting Intellectual Property Strategy
In accordance with the Patent Law of the People's Republic of China, the Implementing Regulations of the Patent Law of the In line with industry trends and the Company’s development needs, Baogang Steel has identified opportunities and potential
People's Republic of China , and the Patent Management Measures of Baogang (Group) Company, Baogang Steel has revised risks related to product quality and formulated targeted response strategies to promote the deep integration of quality and stra-
and issued the Patent Management Measures of Baogang Steel. It has improved its intellectual property management system, tegic development, including:
specifying management structures and responsibilities, the application and use of patent systems, and patent application
procedures. The Technology Center has been designated as the centralized management department for intellectual property Opportunity Response Measures
and patent matters, responsible for system development, planning, strategic implementation, and overall coordination across
units. The Company has also clarified ownership of intellectual property in research collaborations, established accountability ○ Focus on energy infrastructure, new energy, and large-scale equipment manufacturing projects
mechanisms, standardized patent protection management, and conducted internal patent training, optimized review processes, in the autonomous region, strengthen industrial chain collaboration, and strive to achieve
and improved patent application efficiency and authorization rates. As of the end of 2025, the Company held 2,721 valid patents annual sales of 9 million tonnes of specialty steel.
Seizing the "Two New"
and
and obtained 98 newly granted invention patents. "Two Major" ○ Upgrade channel structure and step up efforts to expand direct-supply customers and leading
policy opportunities enterprises.
○ Optimize the handling model for off-plan products and explore diversified trading approaches.
Indicators and targets
○ Accelerate the transformation from manufacturer to service provider, and advance the integration
In 2025, The Company's total R&D investment amounted to RMB 3.367 billion (full-caliber), with operating revenue of RMB 66.358
of R&D, production and sales as well as IPD-integrated product development management.
billion. R&D intensity reached 5.07%, significantly exceeding the target of 4.5%.
○ Expand into upstream and downstream industrial chains, including cutting and distribution as
Meeting downstream
According to the Company's 15th Five-Year Plan for scientific and technological innovation, The Company will continue to increase demand for high-end
well as deep processing.
efforts in technological innovation and R&D investment in 2026, striving to achieve an annual R&D intensity of 5%.
steel products
○ Deepen the EVI (Early Vendor Involvement) collaboration model and provide customized
material solutions.
Strengthening Quality Foundations Risks Response Measures
and Elevating the Brand Difficulty in accurately
matching application
○ Advance the development of EVI technology R&D and service teams, proactively engage from the
new product development stage, and provide support in material selection, process design, and
scenarios other areas.
The Company consistently adheres to its quality policy of "guided by Baogang's high-quality development strategy, driven by
customer needs, strengthening risk awareness, stabilizing production processes, enhancing quality management, implementing
○ Build a three-in-one closed-loop management system integrating standardized process quality
brand building, and continuously improving customer satisfaction and loyalty". Centered on this policy, the Company has established
Insufficient product
quality stability operations, refined control, and routine monitoring, and strengthen control over process parameters.
a full-process quality control system, continuously optimized its customer service system, effectively ensured product quality, and
enhanced customer satisfaction.
Insufficient technical ○ Establish a professional technical service team composed of multiple departments to provide
service capability value-added services, including guidance on material selection and on-site process optimization.
Product Quality Assurance Impact, risk, and opportunity management
In 2025, the Company focused on implementing management requirements in two areas—quality management upgrading and
Under the quality management policy of being guided by "Baogang's high-quality development strategy, driven by customer needs,
quality culture development—and achieved remarkable results.
strengthening risk awareness, stabilizing production processes, enhancing quality management, implementing brand building, and
continuously improving customer satisfaction and loyalty", The Company ensures that its product quality meets and exceeds industry
standards while addressing diverse customer requirements. Quality Management
Quality Management Measures
○ Organized the revision of 56 enterprise standards and interim technical specifications, including hot-
Governance Strengthening rolled steel plates and strips for railway vehicles with atmospheric corrosion resistance and silicon-
The Company strictly complies with the Product Quality Law of the People's Republic of China and other applicable laws and standard system aluminum-calcium products.
regulations. Its quality management system is composed of management, functional departments such as manufacturing development
○ Participated in the formulation of four national standards and one industry standard, led the
and quality, product production units, and support departments including marketing and R&D, with clearly defined roles and
development of one industry standard, and four group standards.
responsibilities. A comprehensive quality documentation control system has been established, and multiple management
systems such as the Measures for Quality Management of Raw Materials, Fuels and Auxiliary Materials of Baogang Steel and
the Measures for Process Quality Management of Baogang Steel have been formulated. Focusing on full-process quality
control of steel products, the Company implements targeted measures across five dimensions—product and process design, ○ With the "six-oriented" approach as the foundation, established 84 physical evaluation indicators
Building a
process management, raw material input, control of key products, and final release inspection—thereby building a closed-loop and 177 process quality assurance evaluation indicators, implemented quality prevention and
"zero-defect"
continuous improvement, and sorted out 173 preventive standards for quality control points.
quality prevention
management system and achieving precise quality control across the entire value chain. mechanism
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
Indicators and targets
Conducting ○ Advanced the development of single-side trimming for cold series products, expanding applicable
quality steel grades from 5 to 19. In 2025, the single-side trimming ratio increased from 55% to 62.88%. In 2025, the pass rate of key products reached 99.13%, an increase of 0.07% year on year, successfully achieving the annual
technology
○ The average monthly loss caused by 18 types of typical quality defects across production lines target. The reduction in 18 types of typical quality defects exceeded 46%, with improvements in both product stability and
breakthroughs
decreased by 45.85% year on year, and the capability for inclusion control improved significantly. dimensional accuracy.
In 2026, the Company aims to achieve a pass rate of key products of over 99.15%. To ensure the achievement of this target, the
Company will continue to deepen precise full-process control, optimize internal control standards, and strengthen process
monitoring and quality traceability mechanisms to steadily improve product quality.
○ Maintained ISO 9001 and IATF 16949 quality management system certifications, obtained
renewal certificates for classification societies of marine steel plates in multiple countries and
Expanding
quality
special equipment manufacturing licenses for pressure pipeline components, as well as multiple
certification
qualifications certifications including the first certification by KRRI of the Korean Ministry of Land, Infrastructure
Optimizing Customer Service
and Transport and CRCC certification expansion and trial certificates for rails.
Adhering to the service philosophy of "meeting customer needs, serving the market, and achieving win-win outcomes", the Company
takes customer needs as the core, and, based on upgraded quality control and enhanced technical service capabilities, continuously
optimizes the integrated service model covering production, sales, R&D and application. It improves its service system, provides
value-added services, and builds a deeply integrated development community with customers.
○ Conducted 49 evaluations of steel product quality and dimensional stability, with overall product
Enhancing
physical product
quality stability quality scores improving year on year.
Actively Responding to Complaints
The Company strictly implements the Measures for Handling Product Claims and Customer Quality Complaints of Baogang
Steel, improves quality credit standards, and establishes rapid response plans for quality issues. For customer feedback,
it initiates a closed-loop management process of "inspection, determination, handling and feedback", promptly isolates
abnormal products, conducts re-inspection and traceability, and quickly formulates corrective action plans. At the same time,
Quality Culture it continuously optimizes customer feedback channels, eliminates root causes through systematic rectification, effectively
reduces losses arising from quality claims, and enhances customer satisfaction. In 2025, The Company received 58 cases of
With the establishment of a "zero-defect" quality prevention system as the core, the Company integrates quality requirements
product quality claims, all of which were satisfactorily resolved, with customer satisfaction reaching 97.84%.
into standardized operations across all processes. Through continuous improvement based on process evaluation and physical
testing, it promotes employees to firmly uphold the principle of "quality first and prevention first". At the same time, driven by
quality improvement initiatives and benchmarking, all units are encouraged to actively participate, forming a comprehensive
quality culture involving all employees, all processes, and all aspects. The sales company
(marketing depart- Quality claim Handling result
ment) accepts handling (closed)
customer claims
The customer On-site investigation Handle in
submits a request for and analysis to accordance with the
handling a product determine the prescribed proce-
quality claim handling plan dures, and the user
con?rms the
handling result
Protecting Customer Privacy
The Company attaches great importance to customer information security management and strictly complies with the Data
Security Law of the People's Republic of China and the Personal Information Protection Law of the People's Republic of China .
It has established a comprehensive customer information and privacy protection management system, standardized the
management of customer transaction and demand information, strengthened internal information control processes, and
On August 29, 2025, The Company held the September production planning meeting and the launch ceremony of "Quality Month" strictly prevented the risk of customer information leakage. In 2025, no incidents of customer information leakage occurred.
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
Supply Chain Transmission Impact, risk, and opportunity management
and Responsible Procurement
Strengthening Supplier Management
The Company has improved its supplier management systems and optimized procurement channels. Adhering to the principles
In accordance with internal systems such as the Supplier Management Measures for Material Procurement of Baogang Steel,
of fairness, impartiality, integrity, and quality, and benchmarking against leading steel enterprises, it has established a
the Company systematically implements full-process management of supplier onboarding, review, evaluation, and exit. It is
transparent, efficient, compliant, and sustainably competitive procurement system, continuously enhancing the sustainable
committed to building a responsible, green, and resilient supply chain, while preventing supplier-related risks and identifying
development capabilities of its suppliers.
opportunities for cost reduction.
Governance ○ Supplier admission methods include admission through open tender, admission by recommendation, self-
Supplier nominated admission, and temporary admission. Suppliers of different categories are required to submit
The Company strictly complies with laws and regulations related to safety and quality. It has established a Procurement Leading Admission corresponding qualification documents related to safety and environmental protection and are admitted
Group, with the General Manager serving as Group Leader, executives in charge as Deputy Leaders, and heads of relevant functional only after rigorous evaluation procedures, ensuring compliance from the source.
departments as members, providing support for major procurement decision-making. An office under the Procurement Leading
Group is set up within the Procurement Center, responsible for overall coordination. In addition, seven specialized procurement ○ The Company has established a special governance leading group to address "leakage and irregularities"
teams have been established to carry out procurement management across various fields according to professional division of issues in procurement, placing strong emphasis on supplier integrity and compliance, and promoting the
labor, ensuring standardized and orderly procurement. The Company has also formulated a number of specific systems, including healthy and orderly development of the supply chain.
the Procurement Management Measures of Baogang Steel and the Supplier Management Measures for Material Procurement of
Baogang Steel. All departmental procurement activities are subject to prior review under the "major decision-making, important
personnel appointments, major project arrangements, and large-sum fund use" mechanism, thereby standardizing the entire
procurement process.
○ Suppliers are subject to dynamic management and review mechanisms. Based on annual evaluation
Supplier results, operating conditions, and major changes, suppliers are categorized and managed accordingly.
Strategy Review
○ For suppliers receiving advance payments, key dynamic monitoring is implemented to promptly track
As a steel enterprise, The Company faces major supply chain risks across various links, including market risk, logistics risk, financial major changes, effectively reduce financial risks, and ensure supply chain stability.
risk, and supplier risk. These risks may have short-term impacts on supply chain security.
Risk Categories Risk Level Specific Risk Profile
Including fluctuations in market demand and prices, and intensified market ○ Suppliers are comprehensively evaluated based on indicators such as supply quality, price level, contract
competition. It is necessary to closely monitor macroeconomic conditions Supplier performance capability, and fulfillment of social responsibility. Evaluation results serve as the core basis
Short-term risks for supplier classification, continuation, exit, and deepening of cooperation.
and policy changes, dynamically adjust production plans, product structures,
Market Risks Evaluation
and marketing strategies, and enhance product competitiveness.
○ Based on evaluation outcomes, the Company optimizes supplier structure, increases the proportion of
direct procurement, reduces channel costs at the source, and further enhances supply chain resilience.
Covering the transportation of raw materials such as iron ore, coal, and coke,
Logistics Risks Short-term risks as well as steel products. The effectiveness of logistics management directly
affects supply chain efficiency.
The industry is capital-intensive, with core risks including excessive capital
○ Based on annual evaluation results and dynamic review outcomes, strict exit mechanisms are
Medium-term risks occupation and insufficient cost control. It is necessary to optimize capital
implemented for E-grade (non-qualified) suppliers and those with major compliance risks, insufficient
Financial Risks
utilization and cost management. Supplier Exit
performance capability, or integrity violations.
○ The Company accelerates market-oriented procurement reform, formulates targeted sourcing plans,
Suppliers include mines, coal enterprises, and steel producers. Insufficient
intensifies market exploration efforts, actively expands and introduces high-quality supplier resources, and
Medium-term risks competition or sudden supply disruptions may lead to production
achieves a virtuous cycle of supplier development.
Supplier Risks
interruptions, product quality issues, and economic losses.
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
Supplier Communication and Training Indicators and targets
Supplier Supplier
Indicator
Baogang Steel has formally become a co-initiator of the China Supplier ESG Rating Platform (CS-ESG) and a drafting entity for
Communication Training
the group standards Guidelines for Supplier ESG Evaluation and ESG Management Requirements for Corporate Supply Chains,
actively contributing to the development of the ESG ecosystem.
○ A normalized communication mechanism has been ○ Focusing on environmental protection, energy
established. Through source tracing, return visits, and conservation, and safety, the Company provides 2025
interviews, procurement standards and compliance policy interpretation and technical exchanges from
requirements are aligned. the supplier onboarding stage to enhance suppliers' Number of suppliers Localization ratio of suppliers Localization ratio of procurement
ESG awareness and practical capabilities.
○ ESG performance clauses are clearly stipulated in bidding
and contractual processes, requiring suppliers to sign ○ One-on-one training is provided to newly awarded
documents such as the Letter of Commitment for Contract suppliers to clarify requirements related to contract
Performance and the Integrity and Honesty Agreement, performance, environmental protection, and
thereby strengthening transparent procurement. assessment.
Targets
The Company has established a standardized management system featuring "one standard, reasonable authorization, and separation
of three roles". It strictly controls the procurement supply chain, prohibits the use of conflict minerals and raw materials involving
conflict minerals, and implements supply chain due diligence requirements to mitigate related risks.
Stabilizing the Supply Chain In 2026, the Company will continue to deepen the application of its electronic procurement smart platform, achieving unified
aggregation of procurement data and full-process online management, thereby ensuring compliance and efficiency in procurement
operations. At the same time, it will further improve green procurement standards, strengthen supplier empowerment, and promote
Inventory Management the development of a more sustainable supply chain.
The Company implements the overall deployment of "ultimate cost reduction" and "inventory reduction". Centered on
cost efficiency and low-inventory operations, it has established inventory early warning and coordinated transportation
mechanisms, thereby optimizing capital utilization efficiency. It promotes strict inventory control and joint reserve and shared
stocking, reducing inventories of spare parts and raw materials and lowering capital occupation. By coordinating environmental
operations and implementing precise measures, the Company continues to reduce hidden costs in warehousing. As of the end
of 2025, inventories of purchased fuels decreased by approximately 21% compared with 2022, and inventories of purchased raw
materials decreased by approximately 23%.
Procurement Management
Focusing on supply assurance and cost reduction and efficiency enhancement, the Company has established specialized task
forces for regional ores, Mongolian ores, scrap steel, and alloys. It strengthens procurement initiative, continuously expands
sourcing channels, increases the proportion of manufacturers, optimizes procurement strategies and contract performance
management, ensures cost alignment with market conditions, and effectively enhances supply assurance capability and risk
resistance.
SDGs Targets
Co-building and Sharing to
Reinforce the Foundations
for Development The Company has deeply embedded the concept of "coexistence and win-win outcomes", integrating employee development,
safety and health, social well-being, and industry advancement into a unified framework, thereby building a sustainable
development ecosystem characterized by internal and external coordination and multi-stakeholder value creation. Adhering to
a people-oriented philosophy, the Company fully safeguards employee rights and interests, provides platforms for employee
development, and fosters a supportive and caring workplace environment. It has established and improved an occupational
safety and health management system to build a strong defense line for the safety and well-being of all employees. The
Company actively fulfills its social responsibilities by supporting rural revitalization initiatives and participating in public
welfare activities, while strengthening community co-building and sharing. Leveraging its technological advantages, it also
leads or participates in the formulation of industry standards, deepens collaboration with universities, associations, and
enterprises, and promotes coordinated, high-quality development across the industry.
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
Employee Development Opportunity
and Rights Protection Opportunity
Categories
Opportunity description
Reporting
period
Response Measures
The Company adheres to a people-oriented approach, fully safeguards employees' fundamental rights and interests,
The national government is continuously improving laws By leveraging policy guidance, the
continuously improves talent cultivation and promotion systems, pays close attention to employees' physical and mental well-
and regulations related to labor employment and social Company can advance compli-
being, and emphasizes work-life balance, thereby supporting employees' growth and development.
Opportunities
security benefits, providing clear policy guidance for ance management upgrades, im-
plement a phased digital control
for upgrading
upgrading compliance management. The proliferation of Medium Term
compliance digital and intelligent technologies allows optimization of system, achieve precise prevention
management employee management processes, reduces human error, and control of compliance risks,
and enhances compliance management efficiency. and enhance overall compliance
management capabilities.
Governance
National policies support the development of skilled Utilize national policy support and
The Company's overall employee management strategy is determined by the Board of Directors and implemented by the
Opportunities
manufacturing talent and high-end technical personnel. align with transformation needs
management team. A Nomination, Remuneration and Assessment Committee has been established. Functional departments such
for talent
A s the Company accelerates transformation and to strengthen talent development,
Long Term
as the General Affairs Department, Organization and Human Resources Department, and Planning Department are responsible for upgrading, demand for digital and intelligent talent optimize talent structure, and sup-
development
managing remuneration and benefits, labor rights, employee training, and promotion, with coverage extending to all employees.
and team increases, creating policy support and development port the effective implementation
building opportunities. of its corporate strategy.
In response to national policies, the
Company continuously improves
The government promotes harmonious labor relations
employee communication mech-
and supports enterprises in improving communication
Strategy Opportunities anisms, reinforces human-centric
mechanisms and strengthening humanistic care. The
Long Term care and mental health initiatives,
Company enhances employee care, communication, and
for harmonious
fosters a community of shared
labor relations mental health support to strengthen connections with
interests between employees and
employees.
Risks the Company, and enhances team
cohesion.
Reporting
Risk Category Risk description Response Measures
period
Impact, risk, and opportunity management
Management personnel may have insufficient under- Continuously track policy chang-
The Company attaches great importance to protecting employees' legitimate rights and interests. It upholds equal employment,
standing of labor laws and company policies, leading to Mid- to es, promptly identify and correct
Compliance improves compensation and benefits systems, promotes democratic management, enhances employee experience and well-being,
deviations in employee recruitment and social insurance long-term implementation deviations, and
Management
contributions; delays in updating company systems fol- update company systems in a and builds harmonious and standardized labor relations. It provides broad development platforms and emphasizes work-life balance,
response
Risks lowing changes in local policies may create compliance timely manner to prevent compli- creating a positive workplace environment.
gaps. ance risks.
Upholding Equal Employment
Amid transformation and upgrading, there is a shortage of Long-term response：Advance The Company fully complies with the Labor Law of the People's Republic of China , the Labor Contract Law of the People's Republic
high-end technical talent, core management personnel, recruitment, training, and talent
of China , and the Provisions on the Prohibition of Using Child Labor . It has established management measures for employees under
and skilled workers, with intense competition for talent pipeline development; focus on
Talent Supply Long Term labor contracts to regulate employment practices and effectively safeguard employees' legitimate rights and interests. The Company
in the industry. Some positions face workforce aging and attracting high-end technical and
adheres to equal employment and equal pay for equal work, strictly prohibits child labor and forced labor, and fosters a diverse and
Risks
a lack of young talent, resulting in a mismatch between digital talent; and optimize the
talent supply and transformation needs. talent structure. inclusive workplace. It provides equal opportunities for all employees and follows the principles of fairness, impartiality, openness,
and transparency. It prohibits all forms of employment discrimination and respects and treats employees fairly regardless of gender,
age, education, ethnicity, religious belief, or cultural background. During the reporting period, the Company recorded no incidents of
Disputes may arise with employees over salary payments, Implement targeted short-term child labor, forced labor, human trafficking, discrimination, or harassment.
job adjustments, labor contract management, or work Short- to measures to handle employee
Labor Relations injury compensation. Failure to resolve such issues mid-term concerns promptly and appropri-
Risks through consultation may lead to arbitration or litigation, response ately, resolve differences through Compensation and Benefits System
while delayed or improper handling of employee appeals internal consultation, and prevent
may escalate conflicts. escalation. Baogang Steel continuously improves its compensation and benefits system, pays the five social insurances and one housing
provident fund and enterprise annuity in full and on time in accordance with the law, and provides competitive working
conditions and remuneration packages. In accordance with group requirements, it also implements supplementary medical
insurance and supplementary pension insurance systems to provide comprehensive protection for employees.
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
Compensation allocation mechanism Facilitating Career Development
○ Prioritize key positions, high-level technical and skilled personnel, and frontline operational roles;
The Company regards employee career development as a key component of corporate strategy and is committed to building a
○ Optimize salary structure and determine differentiated fixed-to-variable pay ratios based on job characteristics; systematic talent development framework. Through the establishment of a tiered talent growth mechanism and diversified career
pathways, the Company provides clear and smooth support for employee capability enhancement and career advancement, fully
○ Establish a distribution orientation where leading cadres have 'low security, high incentives, and income that can increase
unleashing talent potential.
or decrease'; grassroots frontline workers have 'basic security, incentives, and relatively stable income'; and high-level
talents and researchers have 'high security, strong incentives, and competitive income'.
Talent Introduction Promotion Pathways Employee Training
In 2025, the Company implemented national The Company provides well- The Company places strong emphasis on
policies to stabilize employment and introduced structured career development talent development. It adopts a training
Compensation and benefits assurance system
total of 334 employees were recruited through management sequence, an eight- departments, implemented through
○ Employee wages are centrally distributed monthly through the ERP human resources system, generally completed before campus and social recruitment, including 76 level technical and professional hierarchical management, and actively
the 20th of each month. Employees can access their salary details via the ERP system or collaborative management with master's degrees or above; 36 retired sequence, and a dual eight-level involving employees. Training resources
platform. military personnel were specially recruited. skills and operations sequence. This are integrated, and training programs
Through the "3+0.5+0.5" order-based training system supports employee career are systematically organized. In 2025, the
○ Social insurance benefits are implemented in accordance with national and regional regulations.
model, 515 on-site engineers were introduced. planning, ensures integration across Company invested RMB 9.56 million in
○ The Company pays pension, medical, work injury, and unemployment insurance contributions in full and on time and Four high-end talents in the special steel three talent tracks, and establishes vocational education, completed 1,261
implements supplementary insurance schemes as required. field were recruited to support business both vertical promotion ladders and training programs, and achieved 154,000
development, and 53 additional hires were horizontal mobility channels. participant attendances, with a training
made through other channels. coverage rate of 100%.
Working hours and leave management system
○ Focused on strategy implementation and management effectiveness, enhancing political awareness
Training for and performance capabilities.
management
personnel ○ Training included learning on the Central Committee's eight-point decision and key policy directives,
thematic programs, and online training, as well as specialized training for functional departments.
The Company strictly complies with Employees under the standard working Paid annual leave is arranged in
national laws and regulations on working hour system work no more than 8 hours accordance with the law. If such leave ○ Aimed at improving job competency, innovation capabilities, and commercialization of results.
hours, establishes a monitoring system per day and 40 hours per week. cannot be arranged due to work
for employee rest and leave, and provides requirements, compensation at 300% of Training for ○ Specialized training was conducted through functional departments and the Technology Center, with
timely reminders to ensure employees the employee’s daily wage is provided technical and expert-led sessions covering multiple disciplines.
take their entitled leave. with written consent.
professional
personnel ○ Baogang Steel's "Ecological Operation Project for Empowerment, Quality Improvement and Capacity
Enhancement through the Employee Training Cloud Platform" won the Outstanding Award for Smart
Learning Project Operations at the 17th Boao Awards.
Promoting Democratic Management ○ Focused on enhancing theoretical knowledge and practical skills, promoting learning through
Training
competitions, building a strong brand for skilled talent, strengthening key position empowerment,
for skilled
and optimizing the skill level structure.
operational
The Company strictly implements employees' democratic management personnel
rights and continuously deepens democratic corporate governance. On
one hand, the Company has established leadership and supervision
groups, standardized approval processes and disclosure directories, and
promoted effective democratic supervision through special inspections.
On the other hand, it strictly implements the employee representative
congress system, standardizes procedures, enriches content, and fully
leverages grassroots congresses in safeguarding employee rights,
optimizing management, and supporting scientific decision-making. At
the same time, the Company actively tracks employee sentiments and
needs and discloses major matters related to employees and corporate
development through official websites and social media platforms,
ensuring employees' rights to be informed, to participate, to express The Third Session of the Second Employee and Member The Company's joint program with universities for the cultivation of on- Launch Meeting for the 2025 Corporate Professional Skills Competition
opinions, and to exercise oversight. Representative Congress of Baogang Steel site engineers and campus recruitment internships
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
Prioritizing employee well-being Assistance and Care Activities
The Company adheres to a people-oriented approach and has built an employee care system by improving the working environment, The Company cares for and supports its employees. It has established a warm and responsive support mechanism, carry out
providing regular psychological support, delivering targeted assistance and care visits, and fostering a harmonious workplace employee care and outreach activities on a regular basis, and provide timely assistance to employees in need, so as to effectively
atmosphere, thereby continuously enhancing employees' sense of fulfillment, happiness, and belonging and strengthening the convey the Company's care and create a warm and inclusive workplace. The Company continued to advance its year-round "Four
internal driving force for the Company's development. Seasons" employee care initiative. Trade unions at two levels invested a cumulative total of more than RMB 7.5 million in care and
outreach activities for frontline employees, provided assistance to 228 employees with serious illnesses, and extended care visits to
Working Environment and Conditions Protection with clear levels, distinct priorities, and effective coordination—became more thoughtful and responsive.
The Company has consistently adhered to the people-centered development philosophy and integrated the principle of "doing
practical things for the people" into its sustainable development practices. Focusing on employees' most pressing concerns
and urgent needs, the Company has leveraged "small initiatives" to address "major livelihood issues." It invested RMB 4.086 Baogang Steel leaders visited frontline employees to extend care and support
million in targeted projects such as restroom renovations and the optimization of canteens and bath facilities. Effectively resolve
During the 2025 Spring Festival, in order to put its people-
employees' day-to-day pain points and practical concerns. By providing living facilities such as microwave ovens and electric
centered care and sustainable development philosophy into
kettles, building new smart parking sheds, and optimizing commuting services, the Company has comprehensively safeguarded
practice, Baogang Steel's management visited production
employees' health and daily convenience, effectively enhanced their sense of gain, happiness, and belonging, and strengthened
frontlines and employees' families, extended holiday greetings
the foundation for democratic corporate management and harmonious labor relations.
and practical care to on-duty cadres and employees, model
workers, and employees facing difficulties, and placed particular
emphasis on work safety while boosting team morale for the
new year. This initiative effectively enhanced employees' sense
of belonging, happiness, and team cohesion, and successfully
transformed organizational care into an internal driving force
that inspires employees to stay dedicated to their posts and
supports the Company's steady development.
Achievements of the renovation of the "three rooms and one hall" at Newly built smart parking sheds for motorcycles and electric bicycles
Barun Mining Branch Work-Life Balance
The Company advocates healthy work and enjoyable living for its employees. The Company organizes a wide variety of cultural
Psychological Health Assistance and sports activities to enrich employees' lives outside work, effectively enhance their sense of belonging, happiness, and
The Company attaches great importance to employees' mental health. It has organized a wide range of mental health lectures cohesion, and foster a warm and caring corporate family.
and activities and provided professional counseling services to help employees relieve work pressure, ease emotional distress,
and improve psychological resilience and work efficiency.
The Fifth Baogang Steel Employees' Gas Volleyball Tournament Baogang Steel's 2025 "With Affection for the Mines, Because of YOU and
Me" networking and friendship event and care activity for single young
employees working away from home
Mental health lectures Mental health lecture on "Relieve Stress, Build Strength,
and Move Forward"
Indicators and targets
Total number of Turnover rate of Labor contract Social insurance
employees employees signing rate coverage rate
Investment in employee training Average training hours per employee Employee training coverage rate
Mental health activities Lecture on knowledge for caring for employees' mental health
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
Safety First, Industry
Category
Risk Point Existing Risk Control Measures
Prevention and Control as the Priority Struck-by injuries,
○ Inspect tools and implements before operations to
ensure they are intact and undamaged;
Roll removal
The Company consistently places work safety and employees' occupational health in the foremost position. The Company has
Dangerous mechanical injuries, ○ Strictly follow safe operating procedures during roll
and installation
continued to improve its work safety management system, actively implemented the three-year action plan to address the root
Chemicals lifting injuries, and removal and installation operations.
operations
causes of work safety risks, upgraded its digital and intelligent safety systems, promoted the application of key SRE project
Production other injuries ○ Provide labor protection articles and emergency supplies
outcomes, and systematically carried out dedicated training on safety and occupational health, building a solid line of defense that comply with national and industry standards.
for the safety and health of all employees across all dimensions and throughout the entire chain of operations.
Construction, Struck-by injuries, ○ Strictly follow safe operating procedures;
maintenance, mechanical injuries, ○ Special operators with corresponding certificates;
Industrial
and overhaul lifting injuries, and
and trade
○ Ensure that equipment interlocking devices, protective
operations other injuries devices, and related safeguards remain intact and effective.
operations
Governance
The Company has established a Safety Production Committee and an Occupational Disease Prevention and Control Committee, and
has set up a dedicated Safety Management Department as its specialized safety management body. The Company has also built a
dedicated safety management team and formed a safety management system with clearly defined responsibilities and authorities. It Impact, risk, and opportunity management
formulated and implemented the Full Staff Workplace Safety Responsibility System and the List of Workplace Safety Responsibilities
for All Employees of the Company , carried out annual evaluations of the full staff work safety responsibility system, and regularly The Company has established a standardized process for safety risk identification and assessment, under which safety risks are
convened Safety Production Committee meetings and special safety work meetings to accurately study, plan, and deploy key work classified into four levels—major, relatively major, general, and low— enabling precise, tiered, and categorized risk management.
safety tasks, effectively reinforcing the Company's work safety defense line. Baogang Steel has also established a support mechanism pairing "pilot units" with "designated support units," and has promoted
From 2022 to 2025, in accordance with the Measures for the Extraction and Use Management of Work Safety Expenses of Enterprises the outcomes of the SRE project across three stages and eight major modules: laws, regulations, and standards; implementation
and the Measures for the Extraction and Use Management of Work Safety Expenses of Baogang Steel , Baogang Steel made full of the full staff work safety responsibility system; capability enhancement for personnel in key positions; advancement of the
monthly provisions for work safety expenses and strictly used and wrote them off within the prescribed scope of expenditure. Major dual prevention mechanism; SJP standards for maintenance and repair operations; improvement of the hazard inspection and
areas of investment included personal protective equipment; emergency rescue equipment, supplies, and drills; assessment, rectification system; special management of high-risk operations; and contractor management.
monitoring, rectification, and control of major hazard sources and accident hazards; work safety inspections, assessments, consulting,
and standardization development; safety training, education, and communication; maintenance and retrofit of safety protection
facilities and equipment; promotion and application of new technologies, new standards, new processes, and new equipment; as Safety Standardization Development
well as inspection and testing of safety facilities and special equipment.
In 2025, 20 assessment units of Baogang Steel obtained Level 2 Work Safety Standardization certification, and four assessment units
obtained Level 3 certification. To advance the implementation of the Requirements for the Management System of Work Safety
Strategy Standardization in Large and Medium-sized Enterprises , Baogang Steel aligned itself with the new requirements by incorporating core
elements such as leadership role and work report by the principal person in charge into its management system. The Company also
The Company's principal safety risks are concentrated in key areas such as non-coal mining, metal smelting, hazardous chemicals
invited industry experts to provide dedicated interpretation sessions, and comprehensively completed system operation reviews as
production, and construction, maintenance, and overhaul. In response to the most critical and prominent risks, the Company has
well as rectification supervision, ensuring the efficient implementation of the new requirements.
formulated dedicated control measures to achieve precise risk prevention and control in key areas and crucial links. The key risks and
corresponding control measures are as follows:
Industry
Category
Risk Point Existing Risk Control Measures Special Risk Control
The Company has carried out routine risk screening, rectification, and control. The Company revised and filed the
○ Adopt presplit controlled blasting technology for operations
Comprehensive Emergency Response Plan for Production Safety Accidents of Baogang Steel , and further reinforced the three
adjacent to the slope face;
lines of defense, namely tiered control of safety risks, closed-loop management of hazard identification and rectification, and
○ Conduct all-weather slope radar monitoring and carry out no
coordinated emergency response and rescue. By establishing risk registers, specifying deadlines for rectification, and assigning
fewer than 3 targeted manual inspections per week, and perform
Slopes Collapse control responsibilities, the Company has continuously promoted a shift in work safety management toward ex ante prevention
Non-coal
slope cutting and load reduction where necessary;
and prevented workplace accidents at the source.
mining
○ Drain and dewater seepage-prone slopes through drainage holes;
○ Conduct acceptance inspections in accordance with the ○ Baogang Steel has promoted the application of advanced technologies and equipment such as
acceptance standards for presplit slope-face blasting. intelligent monitoring and early warning systems and automated control systems. The Company
has integrated early warning for major hazard sources into its safety informatization system,
Mechanical injuries, ○ Keep areas involving molten metal smelting and transfer Development
effectively prevented and mitigated safety risks, and realized a fundamental transformation in work
Converter poisoning and (including lifting and transport) dry; of the Safety
safety from manual prevention to technology-enabled prevention and intelligent prevention.
smelting suffocation accidents, ○ Ensure the proper functioning of safety monitoring, surveillance,
Informatization
Metal ○ Using digitalization and informatization as key enablers, Baogang Steel has comprehensively
Gas being struck by interlocking, and firefighting equipment and facilities;
System Platform
smelting deepened the development of the dual prevention mechanism featuring tiered control of safety risks
holders objects, scalds, fires, ○ Provide labor protection articles and emergency supplies that and hazard identification and rectification, and has established an online supervision and inspection
other explosions comply with national and industry standards. platform to enable dynamic risk identification, precise classification, and effective control.
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
○ Baogang Steel uses containers with refractory linings and water-cooled structures, and regularly
inspects them for erosion, cracks, and other conditions. Indicators and targets
Molten Metal ○ The Company equips operating areas with protective facilities such as slag-retaining plates and splash 2025
Discharge and guards. Before operations begin, it ensures that containers and surrounding areas are dry, clean, and
free of combustible materials, and that personnel have been evacuated from the warning zone.
Number of work- Occupational injury Number of working days lost Injury rate per million
Storage
related deaths rate due to work-related injuries working hours
○ Emergency receiving pits (or tanks) are installed on site, and dedicated emergency drills for
scenarios such as splashing and overturning are organized on a regular basis.
working hours
Safety ○ Baogang Steel completed full coverage of pre-safety assessments, facility design reviews, and
Assessment acceptance evaluations for 36 newly built projects. The Company conducted comprehensive
for Newly Built assessments of project layout, equipment, and processes, systematically identified risks such as fire,
Projects explosion, poisoning, and mechanical injury, and formulated targeted control measures accordingly. Community Co-building
and Local Commitment
Safety Training and Drills
The Company consistently upholds the principle of giving equal importance to social responsibility and corporate development.
In light of actual production conditions, The Company regularly carries out safety training, safety-themed activities, and emergency The Company actively implements the rural revitalization strategy, engages in public welfare and charitable initiatives, shares
drills. In 2025, the Company invested RMB 17.4985 million to build a 1,779-square-meter Safety Experience Center, covering ten the benefits of development with society, and contributes to the building of a better and happier community.
major practical training zones and VR virtual experience modules. The Center provides employees with immersive safety training
and effectively enhances the risk awareness and emergency response capabilities of frontline personnel. In addition, the Company
organized dedicated emergency drills around key areas, strengthened employees' risk prevention awareness as well as self-rescue
and mutual rescue capabilities, and built a stronger safety safeguard for production and operations.
Promoting rural revitalization
The Company has actively implemented the arrangements and plans of the autonomous
region and Baotou municipality. Closely centering on the main task of fostering a strong sense
of community for the Chinese nation, the Company has actively supported rural revitalization
through such initiatives as consumption-based assistance. In 2025, through the Baogang
Wankai and Tiehua platforms, The Company purchased RMB 7.6596 million of products
under its consumption-based assistance program. This not only helped meet employees’
Baogang Steel was recognized as an
Baogang Co., Ltd. Safety Management Information System Baogang Co., Ltd. Safety Experience Center - Blind Plate Plug Extraction needs, but also generated tangible income gains for farmers. Outstanding Practice Case of Rural
Operation Safety Training System Revitalization by a Listed Company
Practising social welfare
The Company has actively practiced the volunteer spirit of dedication, friendship, mutual assistance, and progress. The Company
encourages Youth League members and young employees to participate actively in public welfare activities, proactively works
with the Baogang Working Committee on Caring for the Next Generation, nursing homes, and special education schools, and takes
concrete action in public-interest initiatives such as assisting people in poverty and hardship, supporting the elderly, and helping
persons with disabilities. In 2025, Youth League organizations at all levels carried out a total of 562 volunteer service activities, with
Baogang Steel hidden hazard identification and rectification competition Baogang Steel comprehensive emergency drill for gas leakage 4,666 participant-times and 10,545.43 service hours in total. In addition, 44 employees took part in public welfare organizations,
delivering warmth through concrete actions and demonstrating the Company's sense of responsibility.
Occupational Health Protection
In 2025, The Company continued to advance the development of its ISO 45001
occupational health and safety management system and successfully passed
the annual surveillance audit for its ISO 45001 occupational health and safety
management system certification. In strict compliance with the relevant
requirements of the Law of the People’s Republic of China on the Prevention
and Control of Occupational Diseases, the Company accurately implemented
its occupational health examination plan and fully completed occupational
health examinations for newly recruited employees, employees working in
positions exposed to occupational disease hazards, and employees leaving Baogang Steel carried out a co-building activity at the Baotou Social Volunteer activity themed "Carrying Forward the Spirit of Lei Feng
such positions. The Company also continued to improve its occupational health Offline special lecture conducted by the Coking Welfare Institute and Inspiring Shared Commitment," organized by the Youth League
management records, providing strong protection for employees’ health. Chemical Branch Committee of the Rare-earth Steel Plate Plant of Baogang Steel
Governance Excellence Driving Green Transformation for Innovation Engine Driving Co-building and Sharing to Reinforce
Steady Development a Low-carbon Future Value Enhancement the Foundations for Development
Deepening Cooperation and Exchange
The Company remains committed to openness, collaboration, mutual benefit, and win-win outcomes. The Company continues
to deepen exchanges and cooperation with universities, research institutes, and partners across the industrial chain. Focusing on
key areas such as joint technology research, commercialization of achievements, product promotion, and talent development, the
Company has built multi-level cooperation platforms and promoted high-quality development.
Volunteer Service Month activities themed on learning from Lei Feng Care and outreach activities in support of military personnel and their
families
Industry Synergy
and Standards Leadership
The Company adheres to the philosophy of openness, inclusiveness, and win-win cooperation. The Company actively works
Seminar on technological exchange and innovation-driven development themed "Joint Technology Research and Commercialization of Achievements"
with partners to expand mutually beneficial pathways, achieve complementary advantages through resource integration, jointly
advance collaborative innovation and technological development in the steel industry, build comprehensive, multi-field, and in-
depth strategic partnerships, foster a stronger industrial ecosystem, and promote the high-quality development of the industry.
Formulation of Industry Standards
The Company attaches great importance to the development of the industry standardization system. Relying on its core technologies
and industrial advantages in rare-earth steel, the Company has repeatedly participated in the formulation and revision of national
standards, industry standards, and association standards. Through standardization development, it has empowered technological
upgrading and product quality improvement across the industry and contributed to elevating the overall development of the steel
industry to a new level. Deepened university-enterprise cooperation with Inner Mongolia Jointly cultivated on-site engineers with Inner Mongolia University
University of Technology and opened a new chapter in the joint of Science & Technology to deepen the integration of industry and
cultivation of on-site engineers education
Official release of the first association standard for Rare-Earth Structural Steel Plates for
Bridges , drafted under the leadership of Baogang Steel
In November 2025, The Company led the drafting of the standard Rare-Earth Structural Steel Plates for Bridges . Released
by the China Iron and Steel Association, the standard was authoritatively recognized by an expert panel as having reached
an internationally advanced overall technical level. As the first association standard in the industry specifically for rare-
earth structural steel plates for bridges, it filled a gap in China's high-end bridge steel sector. The release of this standard
not only provides unified guidance for the R&D, manufacture, and engineering application of rare-earth steel for bridges,
but also further enhances the Company's technological influence and industry standing in the field of rare-earth steel,
providing strong support for expanding the application of related products in key engineering projects and strengthening
their market competitiveness.
Promotion conference and technical seminar on hydrogen transmission pipelines
Sustainable Development Management
Sustainable Development Management Stakeholder communication
The Company has integrated the ESG concept throughout the entire process of business operations. The Company continues to
The Company attaches great importance to stakeholder management. The Company has established regular communication
improve its governance structure, strengthen its ESG management system, and continuously optimize its ESG management and ESG
channels with all stakeholders so as to promptly understand the expectations and demands of government and regulatory
indicator system, providing solid support for the steady enhancement of its sustainable development performance.
authorities, shareholders, employees, customers, suppliers, the public, and the media. Through various measures, the Company
actively responds to these expectations and concerns and incorporates them into its operations and strategic decision-making
ESG Governance Structure processes, safeguarding stakeholders' rights to be informed, to participate, to express opinions, and to exercise oversight.
The Company has studied and developed an ESG governance structure comprising three levels: the Board of Directors, the Board's
Strategy and ESG Committee, and the ESG Working Group. The Board of Directors is the highest responsible body for the Company's
ESG management operations and public information disclosure. Board's Strategy and ESG Committee is responsible for formulating
Stakeholder Expectations and Demands Communication and Response
ESG goals and related systems, while the ESG Working Group serves as the principal coordinating and execution body, coordinating
○ Improve corporate governance
and advancing the implementation of ESG-related matters.
○ Compliance in operations ○ Strengthen compliance management
○ Tax payment in accordance with the law ○ Consciously accept supervision
○ Anti-corruption and integrity promotion ○ Actively fulfill tax obligations
Responsibilities of the Responsibilities of the ESG Government and
Board's Strategy and ESG Committee
○ Pollution prevention and control ○ Strengthen integrity development
Board of Directors Working Group Regulatory Authorities
○ Work safety ○ Comply with laws and regulations
○ Review and approve the ○ Study and make recommendations on the ○ Formulate ESG-related policies ○ Promote green production and
Company's ESG goals and Company's ESG goals and plans, ESG governance and action plans in line with the
strategic plans; structure and related systems, ESG-related Company's strategy and ESG goals; ○ Establish a pricing adjustment mechanism for related-party
○ Related-party transactions
○ Deliberate and approve the policies, ESG reports, and other relevant matters; ○ Manage ESG-related risks and ○ Transparency of information disclosure
transactions
○ Disclose information in accordance with the law
Company's ESG architecture ○ Identify and monitor ESG-related risks and matters arising in the Company's ○ Corporate governance
Shareholders and
○ Convene shareholders' meetings
○ Investor relations management
investors
and key policies; opportunities with significant impact on the day-to-day operations; ○ Establish multi-channel communication platforms
○ Investment returns
○ Deliberate and approve the Company's business, and guide management to ○ Be responsible for communication ○ Participate in investor communication activities
Company's ESG report; take appropriate measures to address ESG risks with relevant departments and
and opportunities; subsidiaries of the Company,
○ Improve protection mechanisms
○ Review and approve the public ○ Protection of employee rights and interests ○ Standardize workplace safety management
disclosure of the Company's ○ Organize and coordinate the supervision and and coordinate and advance the ○ Occupational health and safety ○ Carry out regular employee training
performance on ESG-related inspection of the Company's ESG-related implementation of ESG-related Employee ○ Vocational training and development ○ Conduct employee satisfaction surveys
matters; policies, management, performance, and matters; ○ Compensation and benefits protection' ○ Provide assistance to employees in difficulty
target progress, and make corresponding ○ Employee care ○ Convene employee representative congresses
○ Review ESG-related risks with ○ Collect, compile, and prepare
○ Organize a variety of cultural and sports activities
recommendations; public disclosures relating to the
significant impact and response
plans for major negative ESG ○ Deliberate and submit the Company's ESG- Company's performance on ESG-
events. related reports to the Board of Directors. related matters. ○ Conduct product innovation and R&D
○ Product quality ○ Apply intelligent technologies
○ Review other matters related to the Company's ○ Other ESG-related matters. Customer ○ Customer privacy protection ○ Strengthen the product quality management system
ESG work. ○ Customer service ○ Standardize information security management
○ Conduct customer satisfaction surveys
ESG Practices
The Company has progressively advanced sustainable development by publishing social responsibility/sustainability reports, ○ Fair competition
participating in the formulation of association standards such as the General Rules for Environmental, Social and Governance (ESG) ○ Eliminate commercial bribery ○ Improve the supplier onboarding mechanism
○ Responsible procurement ○ Strengthen the routine management of suppliers
Information Disclosure of Mining Enterprises, the Guidelines for Environmental, Social and Governance (ESG) Evaluation of Iron and Suppliers and partners
○ Supplier management ○ Participate in industry exchanges
Steel Enterprises, and the Guidelines for Environmental, Social and Governance (ESG) Special Reports of Iron and Steel Enterprises, ○ Win-win cooperation
and conducting social responsibility/ESG training programs.
Case: Preparation of Baogang Steel's 2025 Sustainability Report
○ Public welfare and charity ○ Organize and participate in public welfare activities
On January 15, 2026, The Company held a special training
○ Pollution prevention and control ○ Promote green production and operations
The public
session on environmental, social and governance (ESG)
matters and a kick-off meeting for the preparation of its
explanations from six aspects, including the core principles
for sustainability report preparation, the methodology ○ Strengthen communication and exchanges with the media
Baogang Steel held a special ESG training session and a kick-off ○ Compliance in operations
for double materiality assessment, and the "four-pillar" Media
○ Information transparency
○ Consciously accept media supervision
meeting for the preparation of its 2025 Sustainability Report ○ Improve the timeliness and quality of information
disclosure framework, providing ideas and guidance for
improving the Company's ESG management.
Sustainable Development Management
Substantive issue identification ESG materiality issue matrix
In 2025, in accordance with the latest international disclosure standards such as the European Sustainability Reporting Standards
(ESRS) and IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information, and in strict compliance with High
the requirements of the Guidelines No. 14 of Shanghai Stock Exchange for Self-Regulation of Listed Companies—Sustainability Report 2 5
(Trial), Baogang Steel carried out a double materiality assessment. On the basis of its previous impact materiality assessment, the
Company incorporated a financial perspective, fully included the views of multiple departments and stakeholders, comprehensively 4 1
Impact Importance
analyzed the impacts of ESG topics on the Company's finances and on the economy, environment, and society, and provided focused 13 10
responses in this report to 12 topics deemed financially material. 22
Dual materiality assessment process
Step 1: Context analysis and issue identification
Identify 28 potential material issues based on six factors, forming an issue pool.
Low
Low High
Step 2: 2-1 Impact materiality assessment Financial importance
Impact materiality assessment: Impact level: stakeholder questionnaire survey; possibility: internal and external ESG expert assessment;
Financial materiality assessment: Internal financial department experts assess the financial materiality of each issue from two dimensions,
with multiple departments reviewing and confirming.
ESG Honors
Step 3: Dual materiality assessment analysis
Based on the assessment data from Step 2, form the 2025 materiality issue matrix to determine this year's
materiality issues and their priorities.
In 2025, Baogang Steel received a Wind ESG "A" rating for the second consecutive year.
Step 4: Analysis results guide ESG disclosure and practice
Baogang Steel was recognized by the China Association for Public Companies with the honors of "Excellent
The Strategy and ESG Management Committee reviews and confirms the analysis results. The Company uses the
Practice Case for Boards of Directors of Listed Companies," "Best Practice of Board Office of Listed
analysis results as a guide to carry out targeted disclosure and practice improvements.
Companies 2025," and "Excellent Practice Case for Sustainable Development of Listed Companies."
Baogang Steel was included in the "Top 100 State-owned ESG Pioneer Listed Companies in China
(2025)" list.
Material issue database
management Supply Chain
corruption
resources 25. Anti-unfair competition
safety and quality and medium enterprises
change
customer privacy protection 27. Due diligence
products 21. Compliance management 28.Technology Ethicsand risk
Baogang Steel's ESG rating was upgraded to "A."
Protection
Future prospects
Future prospects
Carry forward past achievements and embark on a new journey. 2026
marks the opening year of the 15th Five-Year Plan period. It is also a pivotal
year for Baogang Steel to consolidate its foundations, build development
momentum, and pursue breakthroughs on the path of high-quality
development. We will unswervingly advance the strategy of "premium
steel products + a series of rare-earth steel products." With firm confidence,
broader vision, united strength, and pragmatic action, we will harness
innovation to build growth momentum and deepen reform to improve
operational quality and efficiency. Amid the tide of our times to build a world-
class enterprise, we will forge ahead with determination, strive to create
a new development landscape for Baogang Steel that is of higher quality,
greater efficiency, and stronger sustainability, and write a magnificent new
chapter of leapfrog development in the new era.
Appendix
Appendix
Key performance
Key Indicators Unit 2023 2024 2025 Key Indicators Unit 2023 2024 2025
Economic performance Self-generated electricity 100 million kWh 52.44 65.46 68.53
Operating revenue RMB 10,000 7,056,538.86 6,808,944.06 6,635,752.40 Installed self-owned clean energy generation
MW 41.45 41.45 41.45
capacity (photovoltaic power generation)
Operating costs RMB 10,000 6,370,751.60 6,272,606.36 5,994,677.60 Annual self-owned clean energy generation
(photovoltaic power generation)
Operating profit RMB 10,000 50,870.36 9,857.08 59,457.97
Operating
performance Total water consumption 10,000 m? 295,961.88 285,034.53 261,484.40
Total profits RMB 10,000 42,026.04 8,583.63 49,043.59
Freshwater consumption 10,000 m? 6,535.00 5,801.73 5,201.33
Net profit RMB 10,000 2,960.42 2,074.89 38,569.82
Fresh water consumption per ton of steel 10,000 m? 4.3 3.87 3.33
Utilization of
water resources
R&D investment RMB 10,000 376,551.82 371,955.43 336,726.04
Recirculating water volume 10,000 tonnes 289,426.88 279,232.80 256,283.07
Proportion of RD investment in business
% 5.34 5.46 5.07
revenue
Water reuse rate % 97.79 97.96 98.01
Number of R&D employees Person 2,032 1,997 3,182
Nitrogen oxides (NOX) emissions Ton 12,018.92 9,518.76 8,926.64
Proportion of R&D employees % 7.51 7.91 12.59
Innovation
driving Sulfur dioxide (SO2) emissions Ton 5,944.69 4,003.80 4,004.00
Total number of valid patents Item 2,015 2,316 2,721
Sulphur dioxide emission per ton of steel kg/t of crude steel 0.39 0.27 0.26
Number of patent applications Item 774 892 1,002
Number of newly granted patents during Particulate matter emissions Ton 7,250.31 5,390.29 5,111.17
Item 440 324 348
the year
Number of newly granted invention Pollutant
Chemical oxygen demand (COD) emissions Ton 130.72 44.27 31.45
Item 70 117 98
patents during the year emission
Environmental performance Ammonia nitrogen (NH3-N) emissions Ton 4.09 3.04 1.99
Environmental protection investment RMB 100 million 56.60 37.71 35.50 Chemical oxygen demand (COD) emission
kg/tonne of steel 0.0085 0.003 0.002
intensity
Number of environmental pollution Dust and particulate emissions per ton of
Item 0 0 0 kg/t of crude steel 0.48 0.36 0.32
incidents steel
Percentage of sites covered by
Environmental
% 100 100 100 Ammonia nitrogen (NH3-N) emission
compliance
environmental risk assessment kg/tonne of steel 0.0003 0.0002 0.0001
management intensity
Percentage of sites certified to ISO 14001
% 100 100 100 Total waste generated 10,000 tonnes 1,063.80 1,323.69 1,442.13
environmental management system
Training coverage rate for employees
% 100 100 100 General waste generated 10,000 tonnes 1,051.80 1,300.90 1,429.95
engaged in environmental-related work
tonnes of standard coal Total non-hazardous waste generated per
Total energy consumption 9,846,615.58 9,431,287.00 9,811,905.23 Ton 149.05 191.06 215.49
equivalent RMB million of revenue
Comprehensive energy consumption per
tce/t of crude steel 677.95 629.11 623.72 Recycled amount of general waste 10,000 tonnes 714.88 959.13 1,135.20
tonne of steel Waste disposal
Total fuel oil consumption Ton 37,669.76 38,225.08 35,923.02 Hazardous waste generated 10,000 tonnes 12.00 22.79 12.18
Total hazardous waste generated per RMB
Diesel consumption Ton 37,602.94 38,156.71 35,873.72 Ton 1.70 3.35 1.84
million of revenue
Gasoline consumption Ton 66.82 68.37 49.30 Recycled amount of hazardous waste 10,000 tonnes 9.14 13.11 11.65
Energy
consumption
Coal consumption Ton 9,912,620.49 9,782,357.68 10,037,774.87 Comprehensive utilization rate of steel slag % 100 100 100
Recovery and utilization rate of dust and
Natural gas consumption cubic metres 83,860,824.00 98,269,505.00 70,059,360.00 % 100 100 100
Cleaner
production sludge
Total electricity consumption 100 million kWh 100.26 86.53 83.31 Green coverage rate of plant areas % 50.1 50.1 50.1
tonnes of standard coal
Waste heat energy consumption 767,121.24 867,641.35 812,587.89
equivalent
Appendix
Key Indicators Unit 2023年 2024年 2025年 Key Indicators Unit 2023年 2024年 2025年
Social performance Number of suppliers Units 1,462 1,632 1,679
Labor contract signing rate % 100 100 100 Number of suppliers in Mainland China Units 1,459 1,632 1,679
Proportion of employees covered by
% 100 100 100
collective agreements
Number of suppliers subject to ESG-
Social insurance coverage rate % 100 100 100 related audits or assessments, including
Supply chain
Units 1,462 1,632 1,679
corporate social responsibility and
security
environmental reviews, during the year
Total number of employees Person 27,274 25,432 25,284
Number of part-time employees Person 0 0 0
Proportion of procurement orders placed
through the tendering and procurement % 100 100 100
Number of ethnic minority employees Person 2,228 2,139 2,198 platform
Protection Total volunteer service hours Hours 900 11,730 10,545
of rights and Turnover rate of employees % 0.37 0.35 0.28 Social
Average volunteer service hours per
Hours 4.5 2.5 2.26
interests of contribution
Number of employees in difficulty employee
Person 756 339 12
employees
receiving assistance
Governance Performance
Average days of paid leave per employee Day 12 12 12
Proportion of independent directors % 45.45 36.36 33.33
Number of recruited demobilized veterans Person 0 45 36
Proportion of female directors % 9.09 18.18 16.67
Proportion of employees with disabilities % - 1.83 1.62
Number of discrimination- and Number of board of directors meetings
Cases 0 0 0 Times 14 14 17
harassment-related incidents held
Proportion of employees receiving training
on anti-discrimination and anti-human % 25 25 25 Board attendance rate % 100 100 100
rights violations
Number of directors attending fewer than
Employee training coverage rate % 100 100 99 Person 0 0 0
Total employee training hours Hours 6,035,979 5,732,354 4,500,000
Number of Audit Committee meetings Times 7 10 9
Career
development
and training Average training hours per employee Hours 226 225 152 Number of meetings of the Nomination,
Remuneration and Assessment Times 4 1 3
Proportion of employees receiving
% 100 100 100 Committee
occupational and skills training
Coverage rate of occupational health Proportion of women among senior
% 100 100 100 % 20.00 16.67 20.00
examinations executives
Incidence rate of occupational diseases? % 0.013 0.000 0.007 Proportion of operating sites assessed for
Corporate % 100 100 100
governance corruption risks
Work-related injury insurance investment RMB 10,000 2,122 2,274 3,161 Total number of directors receiving anti-
Person 12 12 12
bribery and anti-corruption training
Coverage rate of work-related injury
% 100 100 100
insurance Percentage of directors receiving anti-
% 100 100 100
Rate of special operators with bribery and anti-corruption training
% 100 100 100
Occupational corresponding certificates
health and Total number of management personnel
work safety Investment in production safety RMB 10,000 16,100 20,300 25,178 receiving anti-bribery and anti-corruption Person / / 768
training
Percentage of management personnel
Participant-times in work safety training Person-time 176,720 186,060 173,063
receiving anti-bribery and anti-corruption % 100 100 100
training
Hours of work safety training Hours 1,967,555 2,083,872 1,959,287
Total number of employees receiving anti-
Person 27,274 25,432 25,284
Average work safety training hours per bribery and anti-corruption training
Hours 71.6 78.3 78.4
employee
Percentage of employees receiving anti-
Coverage rate of safety risk protection % 100 100 100
% 100 100 100 bribery and anti-corruption training
training
Number or percentage of products
Shareholding ratio of senior executives % 0 0 0
Product and withdrawn or recalled for health and % 0 0 0
service safety safety reasons
Share pledge ratio % 18.02 13.91 15.81
Customer satisfaction % 96.87 97.17 97.84
and quality
Due to the optimization of the statistical methodology, the incidence rate data for occupational diseases for the relevant years have been updated,
and the 2023 data have been adjusted in accordance with the latest methodology.
Appendix
Index of indicators Shanghai Stock Exchange, "Self-Regulatory Guidelines No. 14
for Listed Companies – Sustainability Report (Trial)"
CASS-ESG 6.0 Guidelines for Corporate Social
Contents GRI Standards Topic Corresponding provisions Relevant sections of this report
Responsibility Reporting in China
About This Report GRI2 P1.1-1.2 Green Transformation for a Low-carbon Future—Climate Action and Low-
Combat with climate change Articles 21 to 28
carbon Transition
Chairman's Message GRI2 P2.1
Green Transformation for a Low-carbon Future—Cleaner Production and
Pollutant emission Article 30
Pollution Prevention and Control
About Baogang Steel GRI2 P3.1-3.4
Green Transformation for a Low-carbon Future—Cleaner Production and
Annual ESG Performance - - Waste disposal Article 31
Pollution Prevention and Control
Topic I: "Rare Materials for a Rare Era, Forging New-quality
GRI203 -
Productivity for Major National Equipment" Green Transformation for a Low-carbon Future—Ecological Restoration and
Ecosystem and Biodiversity Protection Article 32
Topic II: "Intelligent Manufacturing Engine, Empowering a New Harmonious Coexistence
GRI203 S2.1.14
Steel Ecosystem with Smart Technologies"
Green Transformation for a Low-carbon Future—Cleaner Production and
Topic III: "Resource Symbiosis, Strategic Resource Security and Environmental compliance management Article 33
GRI304 E3.3.1-3.3.2,E3.3.4-3.3.5 Pollution Prevention and Control
Green Development"
Strengthening Foundations Through Green Transformation for a Low-carbon Future—Resource Circularity with
- - Energy utilization Article 35
Party Building and Strategic Leadership Efficiency at the Core
Governance
Enhancing Governance and
Excellence Driving GRI2 G1.1.1-1.1.2
Standardizing Operations Green Transformation for a Low-carbon Future—Resource Circularity with
Steady Development Utilization of water resources Article 36
Efficiency at the Core
Strengthening Internal Control and
GRI2,GRI205,GRI206 G2.1.1-2.1.4,G2.2.1-2.2.3
Preventing Risks
Responsibility Topic III: "Resource Symbiosis, Strategic Resource Security and
Circular economy Article 37
Climate Action and Low-carbon E1.1.1-1.1.8,E1.1.14-1.1.16, Green Development"
GRI305
Transition E1.1.19-1.1.20
Co-building and Sharing to Reinforce the Foundations for Development—
Resource Circularity with Efficiency at E3.1.1-E3.1.2,E3.1.4-3.1.5, Rural revitalization Article 39
GRI302,GRI303 Community Co-building and Local Commitment
Green Transformation the Core E3.2.1,E3.2.3-3.2.5
for a Low-carbon Co-building and Sharing to Reinforce the Foundations for Development—
E2.1.1,E2.1.3-2.1.8,E2.1.13,
Future Cleaner Production and Pollution Social contribution Article 40
GRI305,GRI306 E2.2.1,E2.2.3,E2.2.5-2.2.7, Community Co-building and Local Commitment
Prevention and Control
E2.4.1-2.4.4
Ecological Restoration and Harmonious Innovation Engine Driving Value Enhancement—R&D Breakthroughs and
GRI304 E2.3.1-2.3.6 Innovation driving Article 42
Coexistence Innovation in Rare-Earth Products
R&D Breakthroughs and Innovation in During the reporting period, the Company's information and digital technology
GRI203 S2.1.1-2.1.3,S2.1.12-2.1.13 applications were mainly focused on such areas as optimization of steel
Rare-Earth Products
production processes and intelligent equipment monitoring. The Company
Innovation Engine Technology Ethics Article 43
Strengthening Quality Foundations and did not engage in scientific research or technology development activities in
Driving Value GRI417,GRI418 S3.3.1-3.3.3,S3.4.1-3.4.4
Elevating the Brand technology ethics-sensitive fields such as life sciences or underlying artificial
Enhancement
intelligence algorithms.
Supply Chain Transmission and
GRI308,GRI414 S3.1.2
Responsible Procurement Innovation Engine Driving Value Enhancement—Supply Chain Transmission
Supply chain security Article 45
and Responsible Procurement
Employee Development and Rights GRI401,GRI402,GRI404, S4.1.1,S4.1.4-4.1.6,S4.1.8-4.1.9,S4.1.11-
Protection GRI405,GRI406,GRI408,GRI409 4.1.12,S4.3.1-4.3.6 During the reporting period, the Company did not have a balance of accounts
Equal treatment for small and medium
Article 46 payable (including notes payable) exceeding RMB 30 billion, nor did such
Safety First, Prevention and Control as enterprises
Co-building and GRI403 S4.2.1-4.2.4,S4.2.6-4.2.9 balance account for more than 50% of total assets.
the Priority
Sharing to Reinforce
the Foundations for Innovation Engine Driving Value Enhancement—Strengthening Quality
Community Co-building and Local S1.1.2-1.1.3,S1.1.5,S1.2.1, Product and service safety and quality Article 47
Development GRI413 Foundations and Elevating the Brand
Commitment S1.2.3-1.2.4,S1.2.6
Industry Synergy and Standards Data security and customer privacy Innovation Engine Driving Value Enhancement—Strengthening Quality
- G1.1.13 Article 48
Leadership protection Foundations and Elevating the Brand
Sustainable Development Management GRI2,GRI3 G1.1.1-1.1.7,G1.1.9,G1.3.1-1.3.2 Co-building and Sharing to Reinforce the Foundations for Development—
Employee Article 50
Employee Development and Rights Protection
Future prospects - A1
Sound Governance for Steady Development—Strengthening Compliance and
Due diligence Article 52
Guarding Against Risks
Key performance - A2
Stakeholder communication Article 53 SUSTAINABLE DEVELOPMENT MANAGEMENT
Appendix Index of indicators - A3
Sound Governance for Steady Development—Strengthening Compliance and
Anti-bribery and anti-corruption Article 55
Feedback - A6 Guarding Against Risks
Sound Governance for Steady Development—Strengthening Compliance and
Anti-unfair competition Article 56
Guarding Against Risks
Feedback
Dear Readers,
Dear Reader, Thank you for reading the 2025 Sustainability Report of Inner Mongolia Baotou Steel Union Co., Ltd. To strengthen
communication and exchanges with stakeholders and further improve the Company's ability and performance in fulfilling its social
responsibilities, we sincerely invite you to complete this feedback form, share your valuable opinions and suggestions with us, and
return your feedback to us through any of the following channels.
Securities and Financing Department Inner Mongolia Baotou Steel Union Co., Ltd.
Correspondence Address: Room 816, Baogang Steel Office Building, Hexi Industrial Zone,
Kundulun District, Baotou, Inner Mongolia
Tel: 0472-2669527 Email: glgfzqb@126.com
Postal Code: 014010 Fax: 0472-2669528
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Inner Mongolia BaotouSteel Union Co., Ltd.
Fax: +86-472-2669000 This report is printedon
environmentally friendlypaper.
Address: Hexi Industrial Zone, Baotou,
Inner Mongolia Autonomous Region.
Postal Code: 014010
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