Stock Code
Environmental, Social, and Governance
(ESG) Report
Southchip Semiconductor Technology (Shanghai) Co., Ltd.
CONTENTS Southchip, born for efficiency!
About This Report Chairman's Message About Southchip ESG Management
Green Operations for a Innovation-driven Development People-centered: Compliance Governance for
Low-Carbon Future and Quality Leadership Moving Forward Together Stable Development
Environmental Compliance Management 19 Innovation-driven Development 25 Employee Rights and Benefits 41 Corporate Governance 53
Climate Change Tackling 20 Intellectual Property Protection 30 Occupational Health and Safety 47 Compliant Operations and Risk Management 57
Energy and Resources Usage 23 Product and Service Quality Management 32 Employee Training and Development 48 Business Ethics 59
Pollutant Discharge and Waste Disposal 24 Information Security and Privacy Protection 37 Community Engagement and Philanthropy 52
Supply Chain Management 38
ESG Data Table Disclosure Index
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
About This Report
Reporting Principles
About This Report Materiality
The Company has identified material topics related to its operation that all stakeholders are concerned about as the highlights of this
This Report is the first Environmental, Social, and Governance (ESG) Report published by Southchip Semiconductor Technology (Shanghai) Report. While reporting on the material topics in this Report, we also took into account the characteristics of our industry and business
operations. The process and results of the Materiality Analysis are set out in the "ESG Management" chapter of this Report.
Co., Ltd. It discloses to our stakeholders the philosophy, management approaches, initiatives, and outcomes of the Company in relation to
ESG matters in the course of its operations.
Accuracy
This Report ensures that the information is as accurate as possible. For the measurement of quantitative information, the data standard,
calculation basis, and assumptions have been explained to guarantee that the calculation error range will not mislead the users.
Quantitative information and notes are detailed in the "ESG Data Table" section of the Report.
Reporting Scope Reporting Period
Balance
This Report covers Southchip Semiconductor Technology The Reporting Period is from January 1, 2025 to December The contents of this Report reflect objective and true facts, and information involving both the Company's positive and negative aspects has
(Shanghai) Co., Ltd. (hereinafter referred to as "Southchip", 31, 2025. Unless otherwise specified, the data in this Report been disclosed in an impartial manner.
refer to the period covered.
"Southchip Semiconductor", "the Company" or “we/us”) and
Clarity
its subsidiaries. Unless otherwise specified, the reporting
scope is consistent with that of the Company's
consolidated financial statements for the same period This Report is published in simplified Chinese and English. In the event of any discrepancy between the two versions, the Chinese version
(stock code: 688484). shall prevail. It contains tables, diagrammatic figures, a glossary of technical terms, etc., to supplement the written content and facilitate
stakeholders' understanding of the information presented. To facilitate faster access to information for stakeholders, this Report provides a
table of contents and a disclosure index of ESG standards.
Basis for Preparation Data Description
Quantification
This Report has been prepared in accordance with the The data and cases in this Report are derived from official This Report discloses key quantitative performance indicators and, where possible, historical data.
Guidelines No. 14 of Shanghai Stock Exchange for records of actual operation of the Company.
Self-Regulation of Listed Companies—Sustainability Report The financial data in this Report are all in RMB. In case of
(Trial) (April 2024) (hereinafter the "SSE Guidelines") and any discrepancies between the financial data and the Comparability
the Guidelines No. 13 of Shanghai Stock Exchange STAR Company's annual financial report, the annual financial
The Company maintains consistency in the statistical and disclosure methodology for the same quantitative metrics across different
Market for Self-Regulation of Listed Companies — report shall prevail.
Reporting Periods. Where there are changes to the data collection, measurement or calculation methods, the relevant data are
Sustainability Report Preparation (January 2026), with retrospectively adjusted, and the adjustments and the reasons for them are explained in the notes to this Report, so as to enable
reference to the Global Reporting Initiative (GRI) stakeholders to conduct meaningful analysis and assess trends in the Company’s ESG performance.
Sustainability Reporting Standards (2021).
Completeness
The scope of the disclosures shall be in line with that of the Company's consolidated financial statements.
Access and Contact Information Timeliness
This is an annual report covering the period from 1 January 2025 to 31 December 2025. The Company strives to publish this Report as soon
This Report is published in electronic form on the information disclosure platform designated by the stock exchange, and is also available as possible after the end of the reporting year to provide timely information for stakeholders' decision-making.
for online viewing and download on the Company's official website. If you have any suggestions for this Report, you can contact us through
Verifiability
the following methods:
Address: Room 1201, Building 4, No. 54, Lane 565, Shengxia Road, China (Shanghai) Pilot Free Trade Zone
The cases and data in this Report were derived from the original records or financial reports of the Company's actual operations, and the
Email: investors@southchip.com sources and calculation processes of the disclosed data are all traceable.
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
About This Report
Green-driven: Illuminating a Low-Carbon Future At Southchip Semiconductor, we regard talent as our most
Chairman's Message
through Energy-Efficiency Innovation valuable organizational asset and are dedicated to building a
platform that empowers our employees to transcend their own
Southchip Semiconductor firmly believes that every gain in chip boundaries.
efficiency represents a direct contribution to the global green
Refinement of our talent development system: We continue to
transition.
deepen rapid talent-growth programs such as the "Little Rocket"
Pursuit of Superior Energy Efficiency in R&D: In 2025, we initiative, encouraging employees not merely to focus on
continued our deep engagement in segmented fields such as performance scores but to seek directions they are passionate
charge pump chargers, high-efficiency DC-DC and AC-DC about. We advocate the principle that "hands-on attempts
converters, and charge management. The Company has outweigh armchair theorizing", and through practical experience
accumulated a total of 199 patents and continues to push the we have cultivated a cohort of multi-skilled talent with global
boundaries of energy conversion efficiency. In 2025, our R&D vision and managerial depth.
expenses reached RMB 647.15 million. By continually optimizing
Commitment to long-termism: We adhere to a long-termist
our chip design solutions, we are helping consumer electronics
development outlook and have refined our talent management
and industrial terminals worldwide achieve significant reductions
philosophy, centered on "selecting, developing, and deploying
in energy consumption.
talent based on core values". In 2025, through the continuous
Expansion of Our Green Footprint Across All Scenarios: Grasping iteration of our processes and systems, we have ensured that our
both macro trends and targeted entry points, we have organization, like a building with solid foundations, can maintain
accelerated our expansion from consumer electronics into healthy and orderly development regardless of market
emerging sectors such as automotive, industrial, and fluctuations.
communications. In 2025, the penetration rate of Southchip
Semiconductor's automotive-grade chips in the smart electric
vehicle market grew by leaps and bounds. By providing highly Governance Discipline: End-to-End Control from
integrated, low-loss power management solutions, we are Baseline to Excellence
becoming the solid "chip-powered" force behind the zero-carbon
Quality is the lifeline of Southchip Semiconductor and our most
transformation of green mobility and smart industry.
solemn commitment to all stakeholders.
Chairman & General Manager Process-oriented quality system: We firmly believe that "process
Strategic Resilience: Building an Industry-Chain
Ruan Chenjie Barrier through "0→1→10" management matters more than results". In 2025, Southchip
Semiconductor further reinforced end-to-end quality control
Southchip Semiconductor Technology (Shanghai) Co., Ltd. across design, verification, and production, instilling quality
"Understanding national strategy and industry trends, and
identifying the right entry points" is key to Southchip consciousness as the muscle memory of every employee. The
Semiconductor's success. We recognize that the sustainable Company met its 2025 target of achieving a product pass rate of
development of an enterprise is inextricably linked with the no less than 98%, realizing a comprehensive elevation from
ecological resilience of China's semiconductor industry. quality baseline to excellence.
Robust and transparent compliance governance: Alongside
Pursuing knowledge through action, building a
In-depth Breakthroughs in Independent Innovation: In 2025,
Southchip Semiconductor upheld its research philosophy of sustained business growth, we have consistently maintained a
"learning with purpose", achieving further "0-to-1" breakthroughs rigorous and pragmatic approach. In 2025, the Company
foundation for global sustainable development with in high-end segments of the analog chip market. We are achieved operating revenue of RMB 3.26 billion, a year-on-year
committed not only to resolving the challenge of domestic increase of 27.01%. We continue to enhance our ESG disclosure
"chips" at the core substitution but also to safeguarding supply chain security and framework and improve the transparency of corporate
self-sufficiency against the backdrop of international competition governance, ensuring that the rights and interests of our
through forward-looking strategic deployment. shareholders, customers, and employees are fully safeguarded.
Deep win-win collaboration along the industry chain: We embed
the concept of sustainability into every link of the domestic supply Looking ahead to 2026: "Sustaining our passion for inquiry into
chain. In 2025, through close collaboration with leading domestic first principles". Southchip Semiconductor will continue to
Dear Stakeholders, cultivate its roots in the fertile ground of analog chips. Guided by
packaging and foundry partners, we achieved steady growth in
The year 2025 has been a pivotal one for Southchip Semiconductor, a year of deep cultivation in the analog chip sector and of strategic production capacity and optimized allocation of resources. We curiosity and using technology as our brush, we remain true to
advancement. Standing at this historic juncture, where industry cyclicality intersects with the global energy transition, we have been are not merely chip designers but ecosystem builders, ensuring our original aspirations in the pursuit of exceptional products,
reflecting not only on how to achieve technological breakthroughs, but also on how, as a technology enterprise, we can build a genuine that our industry chain remains in sync even under complex pursuing knowledge through action. We look forward to joining
"moat" capable of withstanding cyclical headwinds through the systematic practice of Environmental, Social, and Governance (ESG) conditions through multiple joint quality-control mechanisms. hands with partners around the globe to build the future of
principles. China's IC industry, and to contributing Southchip
Semiconductor's wisdom to the creation of a smarter, greener,
The story of Southchip Semiconductor's growth is one of exploration driven by curiosity. From our founding vision of "domestic substitution"
and better society.
to our current journey toward global leadership, we have consistently upheld the spirit of inquiry, seeking to understand not only "what" but Organization for Good: Inspiring Individual
"why". This same spirit guides our sustainability path: we eschew tokenism in favor of engaging deeply with the essence of our business, Motivation, Cultivating Fertile Ground for Achievers
delivering outstanding product energy efficiency to support a green, low-carbon future; cultivating systematic organizational capabilities to
enable our people to thrive; and underpinning our long-termism with rigorous governance structures. "Individual motivation is the foundation of all achievement".
About Southchip Semiconductor
Company Overview
Business Layout and Development History
Corporate Culture
Highlights and Honors
Southchip, born for efficiency!
Southchip Semiconductor Technology (Shanghai) Co., Ltd.
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
About Southchip Semiconductor
Business Layout and Development History
The Company's current product portfolio covers chips for consumer electronics, automotive electronics, and industrial applications. Through
About Southchip
the development of a comprehensive product matrix, Southchip effectively meets diverse system application needs and has become a
leading domestic designer of analog and embedded chips.
Consumer electronics
Semiconductor In the consumer electronics segment, the Company has developed into a
leading chip design company with broad coverage across diverse end
devices, offering a wide range of chip solutions and serving globally
recognized brand customers. With strong product penetration across
both core and emerging scenarios—including smartphones, laptops and
tablets, wearable devices, AI-powered smart glasses, smart speakers,
and AR/VR devices—the Company has not only strengthened its leading
position in traditional markets such as smartphones, but also, through
forward-looking product strategy, is enabling the next generation of
AI-driven intelligent hardware ecosystems, establishing a solid and
sustainable growth foundation.
Automotive electronics
Automotive electronics represents a key strategic focus for the Company.
Starting from onboard charging, and through continued investment in
recent years, the Company has progressively expanded into full-vehicle
application scenarios, including intelligent cockpits, autonomous driving,
and body control systems. It has built a comprehensive in-vehicle chip
Company Overview ecosystem covering perception, transmission, decision-making, and
execution.
Southchip is principally engaged in the research, design, and sales of analog and embedded semiconductor chips, with products spanning
key sectors including consumer electronics, automotive electronics, and industrial applications. Leveraging its platform-based technological
capabilities and full value chain integration, the Company has established a business ecosystem characterized by comprehensive coverage,
Industrial applications
multi-technology synergy, and cross-scenario enablement, continuously delivering high-performance, high-quality, and cost-efficient system
The Company continues to deepen its presence in the industrial sector,
solutions to customers worldwide.
launching multiple targeted products around core scenarios such as
industrial power supplies, energy storage, photovoltaics, and
communications. At the same time, Southchip Semiconductor has been
Basic Information of Southchip Semiconductor expanding into sensing and control chips, further broadening the
boundaries of industrial applications. Through its proprietary process
platforms, the Company has overcome technical challenges such as
Company Name in Chinese 上海南芯半导体科技股份有限公司 environmental interference control and algorithm reliability, extending its
business into higher-precision industrial scenarios including industrial
Company Name in English Southchip Semiconductor Technology（Shanghai）Co., Ltd robotics and smart sensing terminals — building an integrated industrial
footprint combining "power management + sensing and control".
Date of Establishment August 04, 2015
Stock Exchange and Listing Board
Southchip Semiconductor's Overseas Presence
Shanghai Stock Exchange Science and Technology Innovation Board ("SSE STAR Market")
Southchip Semiconductor attaches great importance to the new opportunities presented by "going global", continues to advance its
Company Office Address Room 1201, Building 4, No. 54, Lane 565 Shengxia Road, China (Shanghai) Pilot Free Trade Zone
globalization strategy, and is building a diversified footprint to develop into a globally oriented chip enterprise. As of the end of 2025, the
Company had established entities and teams in South Korea, Singapore, Europe and other locations, and has made significant progress in
expanding its overseas customer base in Korea.
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
About Southchip Semiconductor
CORPORATE
DEVELOPMENT HISTORY
Southchip Semiconductor's Development Milestones
revenue growth of over 100%
Became China's first supplier of for three consecutive years
end-to-end power solutions from
charger to device
The Company began
its operations
Revenue reached the
RMB 1 billion
Began serving multiple 2025
automotive customers
Entered the supply chains
of renowned overseas
customers and achieved a
substantial breakthrough in
global operations
Formed the initial shape of
a diversified business
portfolio covering
automotive, industrial, and
AI sectors
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
About Southchip Semiconductor
Highlights and Honors
企业文化 Culture
Corporate
Key Honors
Top 100 Shanghai Growth Enterprises Top 100 Shanghai Private Manufacturing Top 100 Shanghai Emerging Industry
(Ranked No. 18) Enterprises (Ranked No. 56) Enterprises (Ranked No. 77)
Southchip Semiconductor's Corporate Culture
Top 100 Shanghai Manufacturing 2025 Most Outstanding China Chips China Association of Automobile Manufacturers
Enterprises (Ranked No. 88) in Industrial 2025 Automotive Chip Innovation Achievement
Power and Power Semiconductors
Shanghai Securities News 2025 2025 Listed Company Reputation List
"SSE Eagle — Golden Quality" Award Listed Companies with Outstanding
Competitiveness in High-End Manufacturing
Southchip Southchip Southchip
Semiconductor Semiconductor Semiconductor
Mission Vision Values
Leveraging chip To be a world-class chip Customer-centric and
technology to optimize company that is result-oriented
energy transformation sustainable, healthy,
efficiency and resilient across
cycles
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
About Southchip Semiconductor
Qualifications and Certifications 2025 Key Performance Data
Environmental Performance
Comprehensive energy Greenhouse gas e Water consumption
consumption per unit of revenue missions per revenue unit per unit revenue
"Little Giant" Enterprise in Specialized, Refined, Shanghai Science and Technology
Distinctive, and Innovative (SRDI) Fields Little Giant Enterprise
Social Performance
R&D expenses Percentage of Number of Employee coverage Training coverage Charitable
ratio R&D Personnel patents held rate for information rate of employees donation amount
security training
million
Governance Performance
Shanghai Enterprise Technology Center High-Tech Enterprise Proportion of Number of internal control Signing rate of personal
independent directors training sessions conducted integrity commitment letters
ISO 14001:2015
Environmental Management
System Certification
ISO 9001:2015
Quality Management
System Certification
ISO 26262: 2018 ASIL-D
Functional Safety Management
System Certification
ISO 17025:2017
Laboratory Accreditation Certificate
ESG Management
ESG Management Structure
ESG Management Mechanism
ESG Materiality Assessment
Southchip, born for efficiency!
Southchip Semiconductor Technology (Shanghai) Co., Ltd.
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
ESG Management
Southchip Semiconductor's ESG Management System
ESG Management
ESG Management Structure
ESG topics ESG targets and ESG negative
performance information and
Southchip Semiconductor places great emphasis on the development of its ESG Management Structure. In accordance with external
risk management
requirements such as the Guidelines No. 14 of Shanghai Stock Exchange for Self-Regulation of Listed Companies—Sustainability Report (Trial)
and the Guidelines No. 13 of Shanghai Stock Exchange STAR Market for Self-Regulation of Listed Companies — Sustainability Report
Preparation, the Company has established a top-down ESG Governance Structure and continues to enhance its ESG Management
Mechanism, driving forward its practical work across ESG domains including environmental protection, employee rights and interests, and
corporate governance.
Review annual resolutions on ESG topics, the ESG Report, and ESG management measures
Southchip Semiconductor's ESG Management Structure for 2025 Board of Assume overall responsibility for the outcomes of ESG management
Directors
Supervisory level
Board of Directors
Provide guidance on and
review ESG topics
Periodically review the Support functional
progress of ESG targets departments in
Management Level Analyze and confirm the
financial materiality and managing ESG-related
Executive Management impact materiality of topics negative information
Support functional
Executive and risks
departments in meeting
Management Confirm the progress of annual ESG targets
topic management actions
Execution Level
Departments
Identify ESG topics Identify and set annual Identify and assess the
ESG targets scope and severity of
ESG-related negative news
and risks
Set short-, medium-, and Drive the implementation Formulate management
long-term action plans of ESG targets measures to respond to
ESG Management Mechanism
Departments for topic management ESG-related negative
information and risks
The Company has established a robust ESG management system. By collecting performance data on each ESG topic, monitoring negative
news and risk-related public sentiment associated with each topic, and implementing a closed-loop management process of "information
collection - analysis and assessment - decision-making and response", the Company achieves long-term, sustained ESG management.
In addition, the Company has established a comprehensive ESG data management system that standardizes the collection, organization,
and analysis of indicators and related data under each ESG topic. This system enables the effective monitoring of abnormal fluctuations in
indicators and the precise identification of problem areas, providing robust data support for the long-term management of ESG topics. By
continuously tracking progress against key indicators, it also ensures the realization of the Company's annual ESG targets.
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
ESG Management
Stakeholder Engagement and Due Diligence
Effective stakeholder engagement forms an essential basis for the Company's ESG management. Taking into account the characteristics of
ESG Materiality Assessment its industry and the nature of its operations, Southchip Semiconductor has identified six groups of key stakeholders: government and
regulatory authorities, shareholders and investors, customers, suppliers and business partners, employees, and society and the public. The
Company maintains regular communication with each stakeholder group to fully understand their concerns and views on relevant topics,
and responds to their needs through diversified channels so as to create sustainable value for all stakeholders.
Double Materiality Analysis Process Southchip Semiconductor's Stakeholder Concerns and Engagement Channels
In 2025, Southchip Semiconductor established a topic identification and materiality analysis process in strict accordance with the
requirements on Materiality Analysis set out in the SSE Guidelines, while also drawing upon the principles, methodologies, and processes for Key Stakeholders Topics of Concern Engagement and Response Channels
materiality analysis embodied in sustainability disclosure standards such as the GRI Sustainability Reporting Standards and the ISSB
Standards. The Company analyzed each ESG topic from the dual perspectives of impact materiality and financial materiality, in order to Environmental compliance management
identify the topics that are material to the Company and to assess the actual and potential impacts, risks, and opportunities these topics Climate change tackling Government–enterprise meetings
present to its operations. Pollutant discharge Information reporting and disclosure
Government and Waste disposal Company official website
regulatory authorities Innovation-driven Supervision and inspection
Southchip Semiconductor's 2025 Double Materiality Assessment Process Product and service quality management Processing and renewal of qualifications and
approvals
Compliant operations and risk
management
Shareholders' meeting
Product and service quality management
Results briefings
Innovation-driven
Shareholders and Periodic reports
Intellectual property protection
investors Announcements on significant matters
Understanding of the Company's Topic identification, stakeholder Corporate governance
Investor reception and hotline
activities and business relationships, and engagement, and due diligence Business ethics
Roadshows and reverse roadshows
identification of stakeholders
Conducted research on peer companies, key international Identified, screened, and defined ESG topics relevant to the Environmental compliance management
and domestic strategic customers, and major suppliers, to Company through benchmarking against ESG standards, Climate change tackling
understand the industrial value chain, market expectations policy analysis, and peer benchmarking Customer research
regarding ESG, and ESG development trends in our industry Pollutant discharge
Conducted due diligence with the Company's Waste disposal Customer inquiries and complaints
management, functional departments, and stakeholders
Reviewed ESG-related content in the Company's
through interviews and information gathering, in order to
Customers Product and service quality Customer satisfaction surveys
production activities, business relationships, and strategic management
determine the positive and negative impacts of topics on Company official website
planning
the economy, society, and the environment, as well as the Information security and privacy Reporting and supervision hotline
Identified, understood, and confirmed key stakeholders, risks and opportunities relevant to the Company's protection
and engaged with them through appropriate channels day-to-day operations and business decision-making
Employee rights and benefits
Business ethics
Innovation-driven Periodic supplier assessment and
review
Information security and privacy
Suppliers and partners protection Company official website
Supply chain management Distributor training and communication
Business ethics Reporting hotline and mailbox
Review and confirmation of topics Materiality assessment of topics Employee rights and benefits
Occupational health and safety Employee satisfaction surveys
The materiality assessment results and the materiality Impact materiality assessment: Determined the impacts of
matrix were reviewed and confirmed by the Board of each topic on the economy, society, and the environment,
Employees Employee training and Employee communication and training
Directors analyzing and making judgments around the "scale and development Company official website
scope of the impact", the "likelihood of potential impacts Business ethics
Day-to-day management and information disclosure were occurring", and the "irremediable nature of negative
subsequently organized around the material topics impacts", in order to confirm the impact materiality of each
topic Communities and the Environmental compliance management Environmental information disclosure
Financial materiality assessment: Identified the financial public Climate change tackling Company official website
indicators associated with each topic, analyzing and
making judgments around the "likelihood of financial
impacts occurring" and the "magnitude of financial
impacts", in order to confirm the financial materiality of
each topic
The Company attaches great importance to the identification and management of risks and opportunities associated with each topic, and
Consolidation of double materiality results: Confirmed the
is progressively refining its routine due diligence mechanisms. These mechanisms focus on core areas including environmental compliance,
materiality ranking and boundaries of each topic, and
combined the results of the impact materiality and product quality management, R&D and innovation, and business ethics. Assessments are conducted through interviews, research, and
financial materiality assessments to produce the communication with stakeholders, with particular emphasis on identifying and responding to negative impacts and risks related to
Company's 2025 Materiality Matrix
sustainable development.
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
ESG Management
Conclusions of the Materiality Analysis
Based on the topics identified, Southchip Semiconductor assessed each topic for impact materiality and financial materiality, and through expert discussion confirmed the final materiality ranking of all topics. In 2025, of the 17 topics identified and screened by the Company, 4 topics were found to be both
financially material and impact-material, 1 topic was financially material only, 11 topics were impact-material only, and 1 topic was neither financially material nor impact-material. In this Report, the Company provides focused responses on how these impacts are managed, risks mitigated, and
opportunities captured, and presents the materiality of each topic in matrix form.
Southchip Semiconductor's 2025 ESG Materiality Matrix
high
Topics having both financial materiality and impact materiality
Topics having financial materiality but not impact materiality
Innovation-driven
Topics having impact materiality but not financial materiality
Materiality of impact on the economy, society, and the environment (impact materiality)
Neither financial materiality nor impact materiality
Climate change tackling Environmental compliance management
Corporate governance
Notes: Of the 21 topics set out in the SSE Guidelines, "stakeholder engagement" and "due diligence" constitute necessary processes for the
Company's identification and analysis of ESG topics and are addressed in the "Materiality Analysis" chapter, rather than being included as ESG
Employee rights and benefits Business ethics
topics within the Materiality Matrix; all other topics are addressed in the Report and the Disclosure Index. In addition, the Company has
independently identified 3 further topics: "Corporate governance", "Compliant operations and risk management", and "Intellectual property
Energy usage Employee training and development protection".
Intellectual property protection Information security and privacy protection Product and service
quality management
Pollutant discharge
Usage of water resources
Occupational health and safety
Waste disposal
Supply chain management
Compliant operations and risk management
low high
Materiality of impact on company finance (finance materiality)
CHAPTER
Green Operations for a
Low-Carbon Future
Environmental Compliance Management
Climate Change Tackling
Energy and Resources Usage
Pollutant Discharge and Waste Disposal
Southchip, born for efficiency!
Southchip Semiconductor Technology (Shanghai) Co., Ltd.
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
Green Operations for a Low-Carbon Future
Climate Change Tackling
Green Operations for
a Low-Carbon Future
The sources of greenhouse gas (GHG) emissions at Southchip Semiconductor include electricity and gasoline, and the principal types of
GHGs are carbon dioxide (CO₂), methane (CH?), and nitrous oxide (N₂O). Climate change mitigation and adaptation are the central focus of
the Company's low-carbon practice. In line with the climate disclosure framework comprising "Governance", "Strategy", "Impact, Risk and
Opportunity Management", and "Metrics and Targets", the Company systematically presents its climate change management system below.
Environmental Compliance Management Governance
The Company has standardized the monitoring and management of GHG emissions and established a top-down ESG Management
Structure. The Board of Directors oversees ESG matters, including the topic of "Climate change tackling". The Executive Management is
Upholding the operating philosophy of "Environmental Protection, Health, and Pollution Prevention",
responsible for guiding the climate change action plan, formulating and confirming the implementation of climate performance targets, and
the Company strictly complies with laws and regulations including the Environmental Protection Law
driving the rollout of climate response measures across all functional departments.
of the People's Republic of China, the Water Law of the People's Republic of China, and the Law of the
People's Republic of China on the Prevention and Control of Atmospheric Pollution. The Company has
established a three-tier environmental management system, with the Environmental Management
Manual serving as the overarching framework document, supported by supplementary policies and Strategy
procedures such as the Environmental Operational Control Procedure and the Environmental
Substance Management Procedure, ensuring that environmental management is carried out in a The Company recognizes that a failure to manage GHG emissions may exacerbate environmental harm and contribute to global warming.
systematic and standardized manner. In 2025, the Company did not experience any significant Accordingly, with reference to the climate risk and opportunity categories set out in the ISSB's IFRS S2 Climate-related Disclosures ("IFRS
environmental incidents, and no major administrative penalties were imposed, nor was any criminal S2") and taking into account the characteristics of its business, the Company has conducted an analysis and assessment of climate-related
liability pursued, by ecological, environmental, or other relevant authorities in connection with risks and opportunities, and has adopted measures to respond effectively.
environmental incidents.
The Company has established a governance structure based on "Decision-making and oversight by
the General Manager - Execution and advancement by the Management Representative - Division
Southchip Semiconductor's Climate-Related Risk Identification and Response Measures
of responsibilities and collaboration among functional departments", safeguarding the steady
implementation of all environmental management activities and driving continuous improvement in Financial Scope of
Type Specific Description Response Measures
environmental performance. The Company has been advancing the development and certification
Southchip Semiconductor's
ISO 14001:2015 Environmental Management Systems Certificate Impact Impact
of its environmental management system, and in 2025 successfully obtained ISO 14001:2015 Environmental Management System
Certification. This achievement marks the establishment of an internationally recognized, systematic environmental management The Company may be directly or indirectly
Closely monitor weather forecasts and early-warning
Acute information through local meteorological websites as part of
framework, and the Company will continue to deepen its implementation and drive its continuous improvement going forward. physical
affected by natural disasters such as typhoons day-to-day operations, to stay abreast of the dynamics and
Physical risks
and rainstorms, which could disrupt Impairment of scope of natural disasters and carry out real-time monitoring
risks and early warning
operations fixed assets
The Company attaches great importance to the prevention and management of environmental risks, and has formulated the Environmental
Maintain pre-positioned stocks of raw materials and
Increased Short term
Factor Identi?cation and Evaluation Control Procedure and the Risk and Opportunity Response Management Procedure. These procedures operating costs Medium term
emergency supplies to ensure the stability and security of
operations, minimize the impact of natural disasters on
standardize the identification, evaluation, updating, and management of environmental factors, while enabling the Company to take The Company may face chronic
Decreased
Long term day-to-day business, and safeguard employee safety
Chronic climate-related hazards such as rising
effective response measures to mitigate environmental risks and capture opportunities. physical temperatures and sea-level rise, which could
operating Formulate procedural documents such as the Typhoon and
Rainstorm Emergency Response Plan, establish a preparedness
revenue
risks affect its day-to-day production and working group, conduct periodic disaster-response drills, and
operations activate the emergency response plan immediately upon the
occurrence of any disaster
Southchip Semiconductor's Environmental Risk and Opportunity Management Process
Increasingly stringent carbon emission Stay informed of and comply with relevant
controls both domestically and internationally regulatory requirements, and standardize business
Policy and have raised the bar for GHG emissions Increased Medium term operations accordingly
management. Following the entry into force of
Identification
legal risks operating costs Long term Conduct company-wide GHG emissions inventories
the EU Carbon Border Adjustment Mechanism
(CBAM), the Company's operating costs may on a regular basis, so as to respond promptly to
regulatory requirements
Select and identify environmental factors related to the Company's activities, processes, products, or services rise further
Identify environmental impacts associated with each environmental factor
The introduction of low-carbon and product
Transition risks Market carbon footprint management policies will
reshape market supply and demand, with Decreased
Medium term Closely monitor climate-related laws, regulations,
risks Long term and policies and comply with applicable standards;
customers increasingly favoring low-energy operating revenue actively pursue the R&D of sustainable products
and green products
Assessment
Driven by China's "30·60" Dual Carbon Goals,
Evaluate environmental factors and significant environmental factors using a yes/no assessment method demand for the introduction of energy-saving
Assess the feasibility and necessity of introducing
Technology Increased Medium term energy-saving equipment or procuring green
risks equipment is expected to rise further, leading Long term
operating costs electricity, and actively explore low-carbon and
to increased financial costs
energy-efficient operational solutions
Update and management
As public concern grows around the
low-carbon economy and climate-related Enrich information disclosure channels and content,
Reputational topics, failure to respond appropriately to Medium term and disclose GHG emissions data and progress on
Control significant environmental factors through procedures, guidelines, and other measures risks Decreased Long term
climate change may pose certain reputational emission reduction in a timely manner through the
operating revenue
risks to the Company publication of ESG reports and other means
Update environmental factors in a timely manner in response to changes in laws and regulations or organizational expansion
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
Green Operations for a Low-Carbon Future
Southchip Semiconductor's Climate-Related Opportunity Identification and Response Measures
Metrics and Targets
Financial Scope of
Type Specific Description Response Measures Aligned with the pace of China's low-carbon transition, the Company tracks progress in climate change mitigation and adaptation through
Impact Impact
a set of indicators, and further reduces GHG emissions through initiatives such as optimizing energy use.
Resource Improving the efficiency of energy, water, and Short term Actively adopt green office and green operations
Reduced Medium term measures, and strengthen employee
efficiency raw material use in operations reduces
operating costs Long term communication on resource and energy
opportunity operating costs
conservation
Proactively undertake energy-saving retrofits to Southchip Semiconductor's 2025 Climate Change Tackling Metrics and Targets
reduce energy-related expenditure
Energy source Increasing the proportion of green energy Short term Incorporate eco-friendly concepts during the
opportunity used across the value chain, thereby Reduced
Medium term renovation of office buildings, reducing resource
mitigating the impact of traditional energy operating costs
Long term consumption in both construction and operation
price volatility
In the context of the low-carbon economic
Product and transition, growing customer demand for Short term
service environmentally friendly products and services
Increased
operating revenue
Medium term Metric Total GHG emissions Metric Greenhouse gas
opportunity may create new market opportunities for the Long term Gain insight into market demand and focus research (Scope 1 + Scope 2) emissions per revenue unit
Company and technology reserves on low-energy, compact
products
In a low-carbon economy, strong performance
on climate-related issues is increasingly
Strengthen industry–academia–research
collaboration, and actively introduce new materials Unit tCO2e Unit tCO₂e / RMB 1 million
Market favored by the market. By focusing on product Short term and technologies to enable the development of
Increased more environmentally friendly products
opportunity quality and process innovation, the Company operating revenue Medium term
can reduce risk while generating stable
revenue | Increased operating revenue | Short-,
Long term
Progress in 2025 Progress in 2025
medium-, and long-term
Actively participating in climate-related
industry collaboration and exchanges helps Reduced Short term
Join industry associations and participate in
industry forums and exhibitions to share resources
and best practices with peers, promoting
Adaptability Medium term
build adaptive capacity in response to climate operating costs technological innovation and business upgrading,
Long term
change and better adapting to a rapidly changing market
environment
Target
Impact, Risk, and Opportunity Management
The Company has established a closed-loop management process covering identification, assessment, and supervision to respond Support China's "30·60" dual carbon goals and
systematically to climate-related risks and opportunities. This approach will effectively enhance the Company's resilience in the face of
climate-related risks and enable it to seize new development opportunities in the low-carbon transition.
continue to reduce GHG emissions
Southchip Semiconductor's Climate-related Risk and Opportunity Management Process
Identification Assessment Management and
supervision
Systematically identify Based on the information Periodically monitor the
climate-related risks and identified, conduct qualitative management measures in place
opportunities that may affect, or analyses to assess the severity of for each climate-related risk and
have already affected, the risks and the potential value of opportunity and assess their
Company's operations, financial opportunities over short-, implementation, to ensure that
position, and strategy, covering medium-, and long-term horizons all management measures
legal, technological, market, and remain effective
environmental domains, and
taking into account both current
and anticipated impacts
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
Green Operations for a Low-Carbon Future
Energy and Resources Usage Pollutant Discharge and Waste Disposal
Energy Usage Pollutant Discharge
The primary types of energy used by Southchip Semiconductor are electricity and gasoline. The Company strictly complies with the Energy Pollutant discharge at Southchip Semiconductor consists primarily of laboratory dust and domestic wastewater. The Company places great
Conservation Law of the People's Republic of China and other applicable laws, regulations, and requirements, and has formulated internal importance on pollutant management and strictly complies with the Law of the People's Republic of China on the Prevention and Control of
procedures such as the Energy and Resource Usage Policy to standardize the management of energy use and to drive reductions in energy Water Pollution and other applicable laws, regulations, and requirements. It has formulated internal procedures such as the Wastewater,
consumption. Waste Gas, and Noise Management Regulations, ensuring lawful and compliant pollutant discharge. In 2025, the Company was not subject to
any major administrative penalties or criminal liability in relation to pollutant discharge.
Southchip Semiconductor's 2025 Energy Management Measures
Southchip Semiconductor's 2025 Pollutant Management Measures
Air conditioners are LED lamps are
switched off promptly installed in place of
when unoccupied conventional lighting
spaces are unused All non-essential to reduce electricity Employees are
electrical equipment losses encouraged to
and screens are commute by public
turned off after transport or shared
working hours bicycles
Wastewater with high oil content must not be discharged directly into Qualified third-party testing agencies are engaged to issue waste gas
wastewater pipelines without prior treatment emissions reports, ensuring that all emissions meet applicable standards
Resources Usage Waste Disposal
All water used in Southchip Semiconductor's operations is sourced from municipal supplies, and the Company does not face any difficulty or Southchip Semiconductor's general waste consists primarily of waste paper, waste cables, and domestic refuse, while its hazardous waste
pressure in securing its water sources. The Company strictly complies with laws and regulations including the Water Law of the People's consists primarily of waste circuit boards and discarded chips. The Company places great importance on waste management and strictly
Republic of China and the Regulations on Water Conservation, and has formulated internal procedures such as the Energy and Resource complies with the Law of the People's Republic of China on the Prevention and Control of Environmental Pollution by Solid Waste and other
Usage Policy and the Regulations on the Preparation and Management of Laboratory Water Use, continuously improving its resource applicable laws, regulations, and requirements. It has formulated internal procedures such as the Solid Waste Management Regulations to
management system. continuously standardize the collection, recycling, and disposal of waste. In 2025, the Company was not subject to any major administrative
penalties or criminal liability in connection with waste management.
Southchip Semiconductor's 2025 Resources Usage Management Measures
Southchip Semiconductor's 2025 Waste Management Measures
Standardized Reduction of Harmless waste Hazardous waste
water management resource consumption Wet and dry waste are separated in accordance After consolidation and registration, hazardous
with waste classification principles and handled waste is handled uniformly by qualified and licensed
uniformly by the property management company third-party professional companies
Regularly inspect water equipment to Comprehensively promote paperless offices,
eliminate leaks, drips, and wastage implement double-sided printing, and deploy Waste items of recyclable value, such as used Chemical and waste management training is
electronic reimbursement and the Feishu
Conduct periodic water-saving awareness computers, are collected uniformly by qualified conducted, with accompanying assessments to
collaboration platform
activities to enhance employees' water third-party companies verify effectiveness
conservation consciousness
CHAPTER
Innovation-driven Development
and Quality Leadership
Innovation-driven Development
Intellectual Property Protection
Product and Service Quality Management
Information Security and Privacy Protection
Supply Chain Management
Southchip, born for efficiency!
Southchip Semiconductor Technology (Shanghai) Co., Ltd.
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
Innovation-driven Development and Quality Leadership
Innovation-driven Development
Impact, Risk, and Opportunity Management
and Quality Leadership R&D and Innovation Management
The Company attaches great importance to the development
Innovation-driven Development
and management of its R&D and innovation systems, and is
committed to establishing standardized product development
processes and quality control mechanisms. These ensure that all
product series benefit from effective management oversight and
Amid the surging tide of technological advancement, innovation is the key pillar and driving force of the Company's continued progress. As quality assurance across the full lifecycle, from product definition
a chip design company operating under the Fabless business model (focusing on chip R&D, design, and sales, while outsourcing wafer and design through verification and mass production.
manufacturing and packaging and testing to external suppliers), Southchip Semiconductor regards product design and R&D as the core of
its business, and innovation-driven development as the central force behind its sustainable growth. Through in-depth innovation and
long-term R&D, the Company has built a distinctive system of proprietary patented technologies, providing solutions and innovative
products that genuinely meet customer needs and deliver real value creation.
Southchip Semiconductor's R&D Management Process
Governance
The Company strictly complies with the Law of the People's Republic of China on Progress of Science and Technology and other applicable
laws, regulations, and requirements. It has formulated internal policies such as the R&D Quality Management Standards and the R&D Design
Work Standards, and has developed procedures tailored to specific product categories, including the Automotive Electronics New Product
Development Procedure and the Consumer Electronics New Product Development Procedure, effectively enhancing the standardization and
Definition stage Design stage
management efficiency of R&D activities. Collect customer requirements and develop initial Product design: Complete the design of all
The Company has established a comprehensive and efficient R&D and innovation governance framework. Multiple Business Divisions and product plans; continue to analyze product sub-modules and the top-level module,
requirements and competitiveness, and monitor transforming abstract circuit designs into physical
R&D departments have been established to address different R&D domains and focus areas, each led by subject-matter experts responsible product development trends on an ongoing basis layouts and ultimately into photomasks for wafer
for formulating and implementing R&D and innovation strategies. These R&D units focus on cutting-edge technology research and product fabrication
development, closely track evolving customer needs and technology trends, and continuously optimize research directions through periodic
Convene project review meetings addressing Process design: Design and produce the product
evaluation. In doing so, they deliver competitive and pioneering technical solutions to customers, providing solid support for the Company's customer requirements, project objectives, product process, including process design, package design,
sustained innovation and development. specifications, cost budgets, and project risks test design, and reliability design
Strategy
Innovation is not only a core value at Southchip Semiconductor but also one of its core competitive strengths. The Company recognizes that
sustained investment in R&D contributes to technological advancement in the analog and embedded chip industry and, by extension, to the
coordinated development of the semiconductor value chain. Through high-intensity R&D expenses, together with measures such as
establishing dedicated task forces and refining innovation mechanisms, the Company is well positioned to seize new opportunities arising
from industry transformation.
Southchip Semiconductor's Innovation-Driven Risk and Opportunity Analysis
Principal Risk /
Specific Description Scope of Impact Financial Impact
Opportunity
Where R&D progress is either too rapid or too slow, products
Short term
Product may fail to meet customer needs, or may prove Increased R&D
Medium term
development risk commercially unviable due to cost or other factors, resulting costs
Long term
in customer rejection
Market share
New products that meet customer requirements in Short term Increased Validation stage Mass production stage
performance, safety, and design can further strengthen Medium term operating
opportunity
market share, industry standing, and customer relationships Long term revenue
Conduct product verification in preparation for Carry out large-scale production, ensuring that new
mass production, including small-scale sampling, products meet market demand, customer
large-scale sampling, and small-batch production requirements, and applicable standards
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
Innovation-driven Development and Quality Leadership
To capture future industry trends and position itself in forward-looking technologies, the Company systematically monitors developments
across its product domains and has established dedicated R&D task forces. These task forces target key technical challenges and pain
Clean Technology Opportunities
points in the business, driving breakthroughs in new products, processes, and technologies and laying a solid foundation for the Company's
As sustainable development becomes an increasingly shared societal
long-term development.
consensus, market demand for green products continues to grow. Southchip
Semiconductor embeds environmental considerations at the heart of
product innovation, seizing the commercial opportunities presented by clean
technologies and actively positioning itself in related fields. Each year, the
Company continues to invest R&D resources in high-performance, highly
reliable, and environmentally friendly clean-technology products, and to
deepen collaboration with partners on green product development,
delivering energy-efficient and environmentally friendly products and
solutions to the market.
Case
Building a Battery Management
System (BMS) to Enable Full Battery
Lifecycle Management
As consumer electronics product cycles accelerate and the
R&D Personnel Management application scenarios for new energy continue to expand, the
battery, as the core carrier of energy, has become the focal point of
Case
A high-caliber R&D team is central to ensuring the innovativeness and technological leadership of the Company's products. Southchip
technological breakthroughs in terms of safety, energy efficiency,
Semiconductor actively builds a technical R&D team with strong professional backgrounds and industry experience, and conducts regular
specialist training for R&D personnel in order to continuously cultivate industry technology experts and build a globally competitive R&D
and application compatibility. However, attendant issues such as Multi-port Fast Charging Solutions
talent pool. The Company actively encourages innovation and has issued the Patent Incentive Management Regulations, encouraging
energy utilization have also highlighted that competition in battery that Effectively Simplify Product
technology has long since moved beyond a simple "capacity race".
employees to engage in R&D and innovation activities, fostering a culture of company-wide participation in innovation, and further Architecture
As one of Southchip Semiconductor's strategic priorities, the
strengthening the R&D team.
development logic of the Battery Management System (BMS)
extends well beyond the chip itself, encompassing a collaborative
In March 2025, Southchip Semiconductor presented a range
Southchip Semiconductor's Southchip Semiconductor's ecosystem of "chip – cell – terminal – application scenario". The
of new products and solutions at the 2025 (Spring) Asia
R&D Investment R&D Personnel Company's latest product, the SC5617E, delivers a power
Charging Exhibition, launching the flagship All-in-one SIMO
consumption as low as 2.4 μA in normal operating mode and as
Multi-port Fast Charging Solution. Carrying forward the
low as 0.46 μA in standby mode – a low-power performance that is
industry-leading – while also offering two core strengths: high
precision and intelligent control.
hallmark features of high integration and high efficiency,
this solution reduces overall volume by more than 30%
compared with traditional two-stage multi-port designs.
Going forward, the Company's BMS products will further explore
Through the integration of proprietary innovations such as
deep integration with terminal systems, delivering
primary- and secondary-side soft-switching and lossless
energy-efficiency upgrades in response to the imperative of green
current sampling, it further improves energy efficiency by
and low-carbon development. From extending battery life to
Southchip Semiconductor's R&D Investment, 2022–2025 Southchip Semiconductor's R&D Personnel, 2022–2025 more than 0.5%, with standby power consumption as low as
optimizing charging efficiency and enabling battery health
below 50 mW.
monitoring in the recycling stage, the BMS will support
Unit: RMB 10,000 64,714.51 Unit: Persons
decarbonization throughout the full battery lifecycle.
All-in-one SIMO Multi-port Fast Charging Solution
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
Innovation-driven Development and Quality Leadership
Industry Collaboration and Exchange Metrics and Targets
In 2025, with a focus on innovation-driven development, the Company established a qualitative target of "continuously advancing product
The Company continues to strengthen the effectiveness of collaborative
and technology upgrades, and optimizing across dimensions including performance, energy efficiency, and reliability", together with a
R&D, operating a model primarily based on in-house R&D and
quantitative target on "design defect resolution rate". These targets are used to verify the effectiveness of the various R&D management
supplemented by external collaboration, thereby contributing to
measures and to inject strong momentum into the Company's development.
industry-wide innovation. In 2025, Southchip Semiconductor actively
engaged in research collaboration and talent exchange with third-party
companies, research institutions, and universities, introducing new
technologies and materials to foster the integration of internal and Southchip Semiconductor's 2025 Innovation-driven Development Metrics and Targets
external R&D capabilities.
Metric Unit Annual Target Progress
Design defect resolution rate % 100 100
Southchip Semiconductor's Industry Association Memberships in 2025
Association/Organization Role
Shanghai Integrated Circuit Industry Association Member Organization
Shanghai Transportation Electronics Industry Association Member Organization
Intellectual Property Protection
Pudong New Area Young Entrepreneurs' Association President Unit
Electric Vehicle Industry Technology Innovation Strategic Alliance Observer Member
Terminal Fast Charging Industry Association Senior Member Organization
As intellectual property (IP) plays an increasingly prominent role in economic development and international trade, gaining greater
attention from more countries and enterprises, Southchip Semiconductor strictly complies with the Intellectual Property Law of the People's
Republic of China, the Trademark Law of the People's Republic of China, the Patent Law of the People's Republic of China, and other applicable
laws, regulations, and requirements. The Company has formulated internal policies and procedures such as the Intellectual Property
Management Standards and the Patent Incentive Management Regulations, to effectively control its own IP management processes while
avoiding any infringement of the IP rights of others. In 2025, the Company did not experience any violations of laws or regulations related to
IP, nor any incident involving the leakage of trade secrets.
The Company regards IP as a key pillar of its core competitiveness. In 2025, the Company established an Intellectual Property Management
Future Business
Leaders" Tech Committee to break down communication barriers between departments and ensure that the application, management, and maintenance
Enterprise of patents, trademarks, copyrights, and integrated circuit layout designs comply with the latest domestic and international laws and
Exploration Series, regulations, continuously optimizing the Company's IP management system.
School of
Management,
Fudan University
Dedicated Visit on
Audio Projects by
the Department of
Music Engineering,
Shanghai
Conservatory of
Music
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
Innovation-driven Development and Quality Leadership
Southchip Semiconductor's Intellectual Property Management System
Case
Intellectual property protection Launch of the "Intellectual Property
Service Desk" to Enhance Accessibility of
IP Information for Employees
Fully understand the importance of IP, identify risks of IP loss
arising from improper conduct, and safeguard the Company's
In August 2025, the Company launched the Intellectual Property Service
lawful rights and interests in its IP
Desk – an online support platform developed for its R&D function and
Ensure the lawful acquisition and use of IP; conduct due various Business Divisions – providing teams with efficient and convenient
diligence on IP acquired through technical collaboration, end-to-end IP services. Through this platform, employees can consult at any
investment, or mergers and acquisitions, verifying its source and time on a wide range of IP matters, including patents, trademarks,
lawful status integrated circuit layout designs, and trade secrets, and obtain professional
support covering application procedures, risk alerts, and competitor
monitoring. The Service Desk helps build a solid IP moat throughout the
Company's product development and innovation processes.
IP risk screening
Product and Service Quality Management
In the R&D and technical improvement of new technologies,
processes, and products, fully leverage the Company's patent
database, commercial search platforms, and patent literature to
Governance
conduct risk screening, develop sound research directions and
technology roadmaps, and avoid IP disputes Southchip Semiconductor strictly complies with the Product Quality Law of the People's Republic of China and other applicable laws,
regulations, and requirements. The Company has formulated the Management Manual as its overarching framework document, supported
Conduct novelty searches before the import or export of new
by internal policies and procedures such as the Nonconforming Product Control Procedure and the Test Quality Control Procedure,
technologies or products involving IP, to rule out IP-related risks'
standardizing quality management and consistently placing product quality and performance enhancement at the core of its operations.
The Quality Department serves as the principal function responsible for Product Quality Management, dedicated to continually exceeding
customer expectations through stable and reliable product quality. In 2025, the Company did not experience any major product safety or
quality incident for which it bore responsibility.
IP confidentiality and commitments The Company is committed to building long-term, stable relationships with customers. It has established a comprehensive customer
relationship management system and has formulated internal policies and procedures such as the Customer Complaint Handling Procedure
and the Customer Satisfaction Management Procedure, strengthening the standardization of customer-related business activities and
Employees must strictly observe confidentiality in both public continuously enhancing overall service quality. The Company adopts a sales model of "distribution-led, with direct sales as a supplement".
and private settings, including at domestic and international Within this framework, dedicated sales teams have been established to serve different markets and business types, responsible for the
academic exchanges, seminars, and product launches, and development, management, support, and training of the distribution network. Through regular service meetings, these teams rapidly
must not disclose Company confidential information or IP respond to market demand and work collaboratively to enhance end-customer satisfaction.
Establish visitor access controls and escort arrangements;
visitors must tour the premises in an organized manner and
Strategy
under the accompaniment of designated personnel, in order to The Company recognizes that a sound product quality management system is instrumental in improving product pass rates. Guided by the
prevent the risk of leaks quality policy of "Quality First, Innovation at the Core, Continuous Improvement, Exceeding Customer Expectations", the Company continues
to advance the development of its quality system and customer service management framework, so as to deliver safe, reliable, and
superior-quality products to its customers.
In 2025, to proactively respond to the dynamic evolution of global patent regulations, the Company further strengthened its patent portfolio Southchip Semiconductor's Product and Service Quality Management – Risk and Opportunity Analysis
and trademark protection framework, driving the transformation of IP management from reactive defense to proactive screening. Patent
early-warning risk assessments have been embedded into key R&D milestones; by identifying infringement risks and technological barriers, Principal Risk / Opportunity Specific Description Scope of Impact Financial Impact
the Company is able to adjust its technology roadmap in a timely manner and optimize its patent portfolio, effectively safeguarding its R&D
expenses. For IP filings relating to overseas-bound projects, the Company has introduced an innovative "Technology + Market + Legal" Inadequate quality management could lead to
product recalls or customer complaints, Short term
Product quality risk Increased
three-party panel review mechanism, enabling precise IP positioning in overseas markets. In addition, the Company will continue to raise resulting in financial compensation or damage Medium term
operating costs
Long term
employee awareness of IP protection through periodic thematic training, and has officially launched the Intellectual Property Service Desk, to brand reputation
providing R&D personnel with timely and systematic professional support and further reinforcing the IP protection perimeter.
To harness employee motivation and creativity, the Company has issued the Patent Incentive Management Regulations, standardizing the Stable and reliable product quality serves as a Increased
Short term
incentive criteria for patent applications and grants – both domestic and international. This policy encourages employees to pursue Brand competitiveness opportunity competitive advantage in the marketplace and Medium term operating
helps to enhance customer trust Long term revenue
technological innovation, enhances the Company's capacity for independent innovation, strengthens IP protection, and helps prevent the
loss of inventions and innovations.
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
Innovation-driven Development and Quality Leadership
Impact, Risk, and Opportunity Management Southchip Semiconductor's System Certifications
Product Quality Management
The Company regards quality management system certification as the
foundation of its quality management. It has built an end-to-end quality
control framework that fully identifies quality risks at every stage of
product development, establishes multiple quality gates to rigorously
manage quality risks, and maintains strict control over supplier
manufacturing processes, thereby continuously enhancing the quality of
the Company's products.
Southchip Semiconductor's End-to-End Quality Control Framework ISO 9001:2015 Quality ISO 26262:2018 ASIL-D Functional ISO 17025:2017 Laboratory
Management System Safety Management System Accreditation Certificate
Certification Certification
Project definition Product design and Process design The Company consistently embeds the principle of full employee participation in its quality management work, and has established a
and planning development and development categorized knowledge-management training system. Training topics cover the quality policy and quality consciousness, quality standards,
quality tools, and internal quality processes, ensuring that every employee can gain knowledge and experience from quality management
Initial risk identification: Define risk items Design risk analysis: Conduct Design training. In 2025, the Company completed 58 continuous-improvement projects, spanning areas including quality enhancement, process
Process risk analysis: Conduct Process
clearly and formulate preliminary control Failure Mode and Effects Analysis (DFMEA) Failure Mode and Effects Analysis optimization, cost reduction and efficiency improvement, and digital and intelligent efficiency upgrades.
strategies, providing a critical basis for to analyze the potential system-level (PFMEA) to identify potential failures in
project approval decisions impacts of chip failure modes, and wafer fabrication, packaging, and The Company has established rigorous nonconforming product control processes, with inspection points set up at multiple stages, including
formulate preventive measures testing, and formulate control measures engineering and pilot production and mass production. Based on the results of the Material Review Board (MRB), disposition decisions for
Feasibility commitment: Joint review by nonconforming products – such as scrapping, rework, or repair – are determined, ensuring that all products delivered to customers meet
design, process, packaging, and testing Design verification strategy: Develop a Quality gate control: Ensure that there is
functions to confirm technological, detailed verification plan, defining capability to manufacture correctly, that customer and applicable quality standards.
supply chain, and cost feasibility simulation requirements, test cases, and the production process has been fully
coverage objectives to verify all designed, and that conditions are in
specifications place for pilot production
Quality gate control: Ensure that the design
is mature, that risks are controllable, and
that the design is verifiable Service Quality Management
Southchip Semiconductor is committed to building long-term, stable
relationships with customers. It has established a customer relationship
management system and formulated internal policies and procedures
such as the Customer Complaint Handling Procedure and the Customer
Product and Feedback, assessment Satisfaction Management Procedure. These clearly define the
process validation and corrective actions responsibilities and division of labor among departments in serving
customers, and continuously optimize and enhance customer service
quality.
Product verification: Conduct Mass production quality monitoring: Monitor
comprehensive electrical performance tests, suppliers' critical process capabilities and The Company maintains open and accessible channels for customer
system-level application tests, reliability production yields, leveraging the TMS system for
communication; customers may submit suggestions or complaints by
tests, and process-device stress tests, continuous monitoring and analysis of Wafer
ensuring that product performance meets Acceptance Test (WAT), Circuit Probing (CP), and email, telephone, and other means. Customer complaints are classified
design requirements Final Test (FT) data into technical and non-technical categories. Upon receipt of any
Pilot production: Implement a safe launch complaint or feedback, the Company handles the matter according to its
mechanism to support the smooth ramp-up Customer issue response: Establish an 8D urgency. All suggestions and complaints are addressed within 24 hours,
of products and to identify and control reporting process to rapidly respond to and resolve
early-stage risks customer complaints, conduct root cause analysis, with subsequent communication and reporting to the customer to bring
and drive closed-loop management the matter to closure.
Quality gate control: Ensure that products The Company conducts customer satisfaction surveys on an annual basis
and processes meet requirements, and that Quality gate control: Ensure stable delivery capability
pilot production results demonstrate the and the readiness of all pre-mass-production
to gain a comprehensive understanding of customers' core concerns, and
capability for stable mass production preparations takes improvement actions based on the findings to continuously
enhance customer service management. In 2025, overall customer
satisfaction stood at 91%.
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
Innovation-driven Development and Quality Leadership
Southchip Semiconductor's Customer Satisfaction Survey Southchip Semiconductor's Distributor Management Process
Feedback and
Regular surveys Internal improvements communication Distributor Distributor Distributor Distributor
onboarding management evaluation promotion
Conduct annual The satisfaction survey team Actively communicate and exit
satisfaction surveys for analyzes feedback and rectification progress with
customers and distributors implements improvement customers and continuously
measures understand their expectations
Surveys adopt unified and feedback
standards to measure
long-term trends Southchip Semiconductor's Distributor Management Measures
Routine management
Case
Revamped Corporate Website
Number of training
and awareness sessions
times
Provide distributors with promotional materials, policy updates, marketing plans, and
product information on an ongoing basis
Visit distributors on a regular basis to understand their inventory, ordering patterns, and
operations
Conduct performance assessments on a semi-annual basis and grade distributors
accordingly
Enhances Online Service Experience Develop the annual distributor training plan in advance, covering topics such as technology,
market, compliance and risk, quality, and processes; evaluate the effectiveness of training
upon completion
In April 2025, Southchip Semiconductor's revamped corporate Conduct audits of distributors on an as-needed basis, issue audit conclusions, and follow
website was officially launched. The upgrade focused on through on improvement actions
enhancing search functionality, resource accessibility, and
interactivity. With a cleaner, more intuitive interface and a richer
suite of features, customers can quickly search for product Promotion and exit management
information and request samples directly through the website, times
removing barriers in chip design and enabling more efficient Review distributors identified as presenting risks (e.g., poor financial condition, breach of
and agile development. Number of Southchip Semiconductor's policies, or legal disputes) and develop exit plans as appropriate
compliance reviews
Implement four major incentive mechanisms tailored to different scenarios and business
conditions
Distributor Management
Metrics and Targets
Southchip Semiconductor has systematically established and strengthened
an internal framework including the Distributor Management Regulations The Quality Department supports all functions in setting annual targets each year, using quantitative indicators to dynamically monitor
and the Distributor Training Plan, and continues to promote their production processes and enabling data-driven, informed decisions. This supports the achievement of quality and service objectives and
implementation and refinement. Through a policy-based and standardized effectively enhances product quality and customer satisfaction.
management framework, the Company further deepens strategic
coordination with its distributors and effectively enhances their overall
operational capability in areas such as business development, customer Southchip Semiconductor's 2025 Product and Service Quality Management Metrics and Targets
service, and market execution. On this basis, the Company has built an
end-to-end distributor management system covering onboarding, routine
Annual Target Progress Annual Target Progress Annual Target Progress
management, performance assessment, promotion, and exit. This provides
≥98
robust support and granular management across the full distributor
partnership lifecycle, continuously elevating distributor performance and Achieved Achieved Achieved
PPM1 %
management standards and reinforcing long-term, mutually beneficial
partnerships. Number of major quality incidents Automotive product failure rate Product pass rate
[1] PPM (Parts Per Million) denotes one in a million; here it is used to measure the failure rate of automotive products, i.e., the number of failures per million units produced.
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
Innovation-driven Development and Quality Leadership
Information Security and Privacy Protection
To clearly define information security classification and categorization standards, clarify the scope of trade secrets, and rigorously enforce
access control mechanisms, the Company has formulated the Information Security Management Regulations. These regulate the principles
governing data definition, classification, access, and flow, and specify requirements for data backup and device use, ensuring that
employees across different functions and seniority levels can reliably access information within their designated authority.
As the convenience offered by data and information technologies to enterprises continues to grow, the importance of information security
has likewise risen. Information Security and Privacy Protection not only provides comprehensive safeguards for the Company's assets but Southchip Semiconductor's 2025 Information Security and Customer Privacy Protection – Performance Highlights
also protects the data assets of stakeholders including employees and suppliers. Southchip Semiconductor complies with the Data Security
Law of the People's Republic of China, the Personal Information Protection Law of the People's Republic of China, and other applicable laws, Conducted 2 training sessions on information The information security service platform The information security communication
security, with 100% employee coverage helped employees resolve 6,015 information platform published 8 case analyses and
regulations, and requirements. The Company has formulated internal policies and procedures such as the Information Security Management
security issues security tips
Regulations and the Information Systems Management Control Procedure, embedding information security compliance and privacy
protection into employees' day-to-day work and guiding the safe and appropriate use of the Company's information assets.
To reinforce the importance of information security across the Company, Southchip Semiconductor has established an Information Security
Committee with the mission of "Building information security systems, strengthening information security protection, and safeguarding the
Company's innovation-driven business growth", overseeing information security and personal information protection on a top-down basis.
Supply Chain Management
Southchip Semiconductor's 2025 Information Security and Privacy Protection Management Measures
Enhancement of security awareness Southchip Semiconductor classifies its suppliers, by nature, into production suppliers and non-production suppliers. Guided by the principles
of openness and shared value, the Company expands its supply chain ecosystem, building long-term, stable partnerships with suppliers –
both domestic and international – that combine advanced process capabilities with industry influence, and promoting the healthy, stable,
Conduct periodic information security training to raise employees' security and sustainable development of the industry chain.
awareness
Operate an information security service platform to address employee Governance
inquiries on information security
Operate an information security communication platform – "Little Security The Company strictly complies with the Civil Code of the People's Republic of China, the Regulations on the Implementation of the Bidding Law
Guardian" – providing employees with the latest updates, security tips, and of the People's Republic of China, the Government Procurement Law of the People's Republic of China, and other applicable laws, regulations,
case analyses and requirements. It has formulated internal policies such as the Supplier Management Procedure and the Supplier Quality Management
Standardize the lock-screen backgrounds on computer displays and Standards, together with procedures and standards tailored to specific supplier types, including the Wafer Supplier Quality Management
conference room TVs to carry information security awareness messaging Standards and the Packaging and Testing Factory Quality Management Requirements. By embedding quality requirements into the supplier
management system, the Company actively implements environmental, social responsibility, and business ethics management for different
types of suppliers, supporting the sustainable transformation of the supply chain.
The Company has established a Technology Management Group (TMG), which centrally manages the formulation and execution of the
Network security inspection Company's business development strategy and procurement strategy. While enhancing procurement efficiency and optimizing supply chain
management, the TMG also drives the implementation of sustainable supply chain management initiatives.
Engage third-party firms to conduct simulated attack-and-defense Strategy
exercises, replicating external attacks on networks and servers; these
exercises cover the majority of key systems, with 100% remediation of The Company recognizes that a safe, stable, and reliable supply chain is the cornerstone of business continuity and on-time delivery to
medium- and high-severity vulnerabilities customers. Accordingly, the Company continues to monitor regulatory developments both domestically and internationally, and – leveraging
both technical and business capabilities – continuously enhances supply chain efficiency and sustainability. Through the development of a
Conduct network disaster recovery drills to ensure that backup systems supply chain system that combines internal and external resources in a mutually reinforcing, dual-circulation framework, the Company
can operate reliably in the event of contingencies works together with its partners to create long-term value for the Company, the supply chain, and society at large.
Southchip Semiconductor's Supply Chain Management – Risk and Opportunity Analysis
Principal Risk /
Specific Description Scope of Impact Financial Impact
Sensitive data controls Opportunity
Supplier concentration is relatively high. Escalating
Review permissions for the Company's documents and designate geopolitical tensions could disrupt key supply chains, Medium term Decreased revenue
Geopolitical risk thereby affecting production continuity and the stability of
document administrators by department, clearly specifying editing, Long term Increased operating costs
product delivery
downloading, and viewing rights to enable controlled management of
document permissions
Deep collaboration with suppliers and process innovation Short term
Revoke administrator rights on computers across most functional Market help to elevate technological barriers and provide the Increased operating
opportunity Company with greater competitive advantages and market Medium term revenue
departments, thereby mitigating risks associated with the installation of opportunities in a highly competitive environment Long term
insecure or non-compliant software
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
Innovation-driven Development and Quality Leadership
Impact, Risk, and Opportunity Management Southchip Semiconductor's Supply Chain Security Management Measures
Supplier Management
To achieve efficient Supplier Management, continuously optimize the supply chain structure, and safeguard supply quality and efficiency,
the Company has established a robust full-lifecycle Supplier Management system, covering supplier onboarding, day-to-day management,
and exit – enabling standardized management across the entire process. In addition, the Company has built a Supplier Management
System that provides full traceability across the procurement process, enhancing the transparency and reliability of supply chain Dual supply chain Raw material security Technology transfer
management.
The Company has established a comprehensive full-lifecycle Supplier Management system, covering supplier onboarding, qualified supplier
Operate a dual domestic–overseas Enter into long-term agreements Adopt the Customer-Owned Tooling
management, and supplier downgrading and exit. This framework enables standardized, end-to-end management from supplier
supply chain, which has been in with key suppliers; monitor raw (COT) design model, independently
introduction through to exit, ensuring the stability, reliability, and sustainability of the supply chain.
place for several years material conditions on a monthly controlling the full tool chain and
basis; maintain safety stock; and technology stack from chip design
ensure multiple sources of supply through manufacturing. This enables
Southchip Semiconductor's Full-Lifecycle Supplier Management for the raw materials of key rapid switching to alternative
products suppliers in the event of capacity
shortfalls at existing suppliers,
safeguarding production continuity
Onboarding of Qualified supplier Supplier downgrade
and supply chain resilience
new suppliers management and exit
Search for potential suppliers based on Implement multi-dimensional, dynamic Apply dynamic management to
Responsible Supply Chain
business needs, conducting a management of qualified suppliers, suppliers based on their quarterly
comprehensive evaluation across ensuring that they continue to meet the evaluation performance, annual audit The Company is committed to embedding sustainability into supply chain management. Building on efforts to safeguard supply chain
multiple dimensions including industry Company's requirements in terms of performance, and quality performance; quality and supply chain security and stability, it actively implements environmental and social responsibility management with respect to
experience and major customers, quality, delivery, technology, cost, and based on the evaluation results, take
quality, environment, engineering environmental performance measures such as downgrading, its suppliers. The Company has formulated and issued the Business Ethics Code of Conduct, covering business ethics-related standards, and
capability, and production and testing, rectification within a specified firmly prohibits improper business conduct in the supply chain, including bribery, unfair competition, and fraud. In addition, the Company
in order to identify candidate suppliers Track supplier performance in real time timeframe, suspension, or termination
for qualification with respect to underperforming requires suppliers to sign the Environmental Commitment Letter and the Supplier CSR Agreement, driving the sustainable, low-carbon, and
through day-to-day communication,
quality meetings, process monitoring, suppliers, thereby safeguarding the environmentally friendly transformation and upgrading of the supply chain.
Conduct quality qualification and new yield monitoring, ORT (Ongoing overall quality of the supply chain
product qualification for suppliers that Reliability Test) monitoring, and on-line The Company attaches great importance to protecting the rights and interests of small and medium-sized (SME) suppliers. It strictly
meet the threshold requirements, and inspection management complies with the Law of the People's Republic of China on Promoting Small and Medium-Sized Enterprises, the Regulations on Ensuring the
enter into agreements including the
Payment of Funds Owed to Small and Medium-Sized Enterprises, and other applicable laws, regulations, and requirements, making timely
Quality Assurance Agreement, the Conduct quarterly performance
Environmental Commitment Letter, and evaluations and annual audits of payments to SME suppliers.
the Supplier CSR Agreement suppliers; drive continuous
improvement among suppliers based
The Company fully recognizes the significant adverse impacts that can arise from the extraction, trading, handling, and export of minerals
Only suppliers that have passed quality on quality performance data in conflict-affected and high-risk areas, including impacts on labor rights, occupational health, environmental pollution, and money
qualification and new product laundering. The Company does not accept or use "conflict minerals" originating from the Democratic Republic of the Congo or its
qualification may apply through the
registration process to become qualified neighboring countries and regions. The Company periodically distributes the Con?ict Minerals Survey to its suppliers, ensuring that the
suppliers sources of gold (Au), tantalum (Ta), tin (Sn), and tungsten (W) comply with the Responsible Minerals Initiative (RMI), the OECD Due Diligence
Guidance for Responsible Supply Chains of Minerals from Con?ict-Affected and High-Risk Areas, or equivalent and recognized due diligence
frameworks. Completed surveys are securely stored in the Company's internal database. As of the end of 2025, all Con?ict Minerals Surveys
distributed by the Company to its suppliers indicated that no conflict minerals were being used.
Supply Chain Security
Amid ongoing uncertainty in major global markets and the geopolitical environment, the risk of disruption to critical industry and supply Metrics and Targets
chains has become one of the emerging risks of key concern to the Company. To mitigate potential supply obstructions or disruptions arising
from the external environment, and to reinforce the confidence of partners and customers, the Company continues to strengthen In 2025, the Company designated the number of supply chain security disruption incidents as a key performance indicator, set a management
collaboration with suppliers and partners and to explore diversified supply chain cooperation models. Through measures including target for this metric, and tracked progress in a timely manner.
implementing dual domestic–overseas supply chains, signing long-term agreements, and maintaining safety stock, the Company is better
positioned to withstand supply chain risks and enhance supply chain resilience.
Southchip Semiconductor's 2025 Supply Chain Management Metrics and Targets
Metric Unit Annual Target Progress
Number of supply chain security disruption
incidents / 0 0
CHAPTER
People-centered:
Moving Forward Together
Employee Rights and Benefits
Occupational Health and Safety
Employee Training and Development
Community Engagement and Philanthropy
Southchip, born for efficiency!
Southchip Semiconductor Technology (Shanghai) Co., Ltd.
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
People-centered: Moving Forward Together
People-centered: Case
Moving Forward Together Multiple On-campus Recruitment
Events Build Diversified Career
Bridges
Employee Rights and Benefits In 2025, Southchip Semiconductor launched its on-campus recruitment
roadshow with the theme "Southchip: Powering Every Dream", visiting
Shanghai, and other cities. The sessions introduced a range of talent
Southchip Semiconductor regards its employees as one of the Company's most valuable assets. The Company strictly complies with the
development initiatives including the one-on-one mentoring program
Labor Law of the People's Republic of China, the Labor Contract Law of the People's Republic of China, the Regulations on Paid Annual Leave for
and customized career development pathways, conveying Southchip's
Employees, the Regulations on Work-related Injury Insurance, and other applicable laws, regulations, and requirements. It has formulated
focus on – and expectations of – every young student and supporting
internal policies including the Employee Handbook and the Employee Incentive Management Procedure, continuously enhancing its employee
students in their career exploration.
management framework across recruitment and employment, compensation and benefits, and diversity and communication, thereby
Southchip Semiconductor's Campus Recruitment Poster
safeguarding employees' fundamental rights and interests.
Southchip Semiconductor's 2025 Employee Recruitment and Employment – Performance Highlights
Employee Recruitment and Employment
The Company strictly complies with applicable laws and regulations. It enters into formal labor contracts with all employees, clearly defining Number of Number of Growth in total employees
male employees female employees
the rights and obligations of both parties and ensuring that the establishment and performance of labor relations are lawful, fair, and compared with 2024
transparent throughout. The Company maintains a zero-tolerance policy towards child labor and forced labor, regarding this as a baseline
requirement of corporate social responsibility. Through measures such as identity verification at the time of onboarding, the Company has
built a preventive mechanism that covers the full spectrum from recruitment through on-the-job management, continuously elevating the
standard of compliant employment management. In 2025, the Company did not experience any incidents involving child labor or forced people people %
labor, and was not subject to any administrative penalty by authorities for employment-related breaches of laws or regulations.
Guided by the recruitment principles of "fairness, openness, and selection based on merit", the Company has established scientific and
systematic recruitment and onboarding procedures – supported by the Employee Handbook, the Employee Recruitment and Onboarding
Management Standards, and online platform management. To actively broaden employment opportunities, the Company has built
diversified recruitment channels, fully tapping internal talent potential through internal referrals and other means to energize employees,
while also attracting outstanding external candidates through online platforms and other external channels. In addition, the Company Employee Care and Benefits
continues to refine and expand both online and offline recruitment channels, aligning talent acquisition with the evolving needs of the
business and ensuring a sustained pipeline of talent that injects fresh energy into the Company's long-term development. The Company continues to refine its employee benefits framework. Building on the strict fulfillment of its statutory obligations, it has expanded
supplementary benefits and supports employees in establishing their own sports clubs, enriching their leisure time, promoting work–life
balance, and comprehensively enhancing employees' sense of belonging and satisfaction.
Southchip Semiconductor's Recruitment Channels
Online channels Offline channels Southchip Semiconductor's Employee Benefits Schedule
ecruitment 01Jmarketplaces
ob fairs at talent
websites
presentations
ecruitment
and campus
recruitment events Social insurance Festival and birthday gifts
Housing provident fund Employee shuttle buses
Statutory holidays, etc. Supplementary medical insurance
Meal allowances, etc.
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
People-centered: Moving Forward Together
Southchip Semiconductor's Badminton Club Activities Southchip Semiconductor's Football Club Activities Employee Diversity and Communication
Badminton club sessions Football club sessions As Southchip Semiconductor's global strategy continues to deepen, its workforce is characterized not only by diversity in gender, nationality,
ethnicity, and color, but also by diverse ways of thinking, educational backgrounds, religious beliefs, and value orientations. The Company
firmly believes that a diverse workforce fosters a more creative and dynamic team, and strives to build a mutually supportive, inclusive, and
collaborative workplace for all employees – one in which every employee can feel a sense of value and belonging.
Southchip Semiconductor's Employee Diversity and Communication Management Measures
Attracting diverse talent
In the context of global operations, prioritize the recruitment and development of local talent in each market, strengthening local
integration and the Company's diversity profile
The Company is dedicated to cultivating an internal culture of recognition and celebrating role models who embody its values. Through a
diversified set of incentive policies – including a multi-dimensional compensation system, a recognition framework, and equity-based
incentives – the Company energizes its talent. On the non-financial side, the Company has launched the Southchip Coin Recognition Fostering an equitable and inclusive working environment
Program, rewarding and supporting outstanding employees in their day-to-day work. On the financial side, the Company links individual
performance targets with departmental performance targets and has developed performance bonus schemes tailored to different business Conduct regular anti-discrimination and anti-workplace-bullying training for employees, including reviews of the detailed requirements
types. In addition, the Company continues to implement equity incentive plans to motivate senior and middle managers and key personnel set out in the Guidelines on Workplace Bullying
who play a significant role in the Company's medium- and long-term development, effectively strengthening employee engagement and Operate the "Culture Ambassador Little C" platform, periodically publishing articles on workplace trends and anti-discrimination and
creativity. anti-harassment awareness, fostering an open and transparent communication environment for employees
Listening to employee voices
Case Operate the "HR Service Platform", providing employees with comprehensive, convenient human resources support
Conduct annual employee satisfaction surveys, listening to and understanding employee views across dimensions including benefits,
Launching the "Southchip Coin" facilities and resources, and career development, and continuously driving improvements
Recognition Program to Enable
Diversified Employee Rewards
Southchip Semiconductor's Workplace Bullying Complaint Process
Since 2024, to recognize employees' contributions in areas such as cross-departmental
collaboration, process optimization, and risk anticipation, the Company has established a
diversified real-time reward mechanism and officially launched the Southchip Coin Complaint management
Recognition Program. The program features three coin categories – gold, silver, and
bronze – which employees can redeem for a range of rewards including branded Any employee who experiences or becomes aware of workplace bullying is encouraged to report it to the anti-bullying email
merchandise, ride-hailing vouchers, and coffee. The initiative has notably reinforced (culture@Southchip Semiconductor.com)
employees' sense of belonging and achievement, inspiring continued effort. In 2025, Reports may also be made verbally, in writing, anonymously, or through supervisors or department heads
Southchip Coins were awarded to a total of 532 employees. Southchip Semiconductor's "Southchip Coin"
Investigation
Southchip Semiconductor's Equity Incentive Data
In 2025 A complaint handling and investigation team will be established to immediately investigate reported matters. The investigation will
remain confidential throughout, and the results will be ensured to be fair and impartial
the Company launched a restricted stock incentive plan and granted
Disciplinary actions
Employees who violate regulations will be subject to disciplinary actions in accordance with the Employee Handbook, and support
will be provided to affected employees
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
People-centered: Moving Forward Together
Work with like-minded
people, take on
challenging endeavors
We strive to build a transparent and equitable corporate
platform, where employees work alongside outstanding
talents and focus on exciting, impactful work.
Southchip Semiconductor's 2025 Employee Diversity and Communication – Performance Highlights Case
Convening the All-Hands Meeting to
Strengthen Employee Communication
Employee inquiries resolved
In August 2025, the Company convened its All-Hands Meeting
(2025 Townhall). Themed "United in Purpose, Embarking on a
New Chapter", the meeting shared comprehensively and in
through the HR Service Platform
depth with every employee the Company's current business
performance, and provided clear analysis and
communication on key topics including product line
% expansion, shifts in the competitive landscape, and talent
Incidents of workplace Employee satisfaction development – ensuring that every employee understood the
bullying or discrimination Company's current progress and future direction.
All-Hands Meeting (2025 Townhall)
Articles published via "
Culture Ambassador Little C"
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
People-centered: Moving Forward Together
Occupational Health and Safety Southchip Semiconductor's 2025 Occupational Health and Safety – Performance Highlights
The principal occupational hazard factor relevant to Southchip Semiconductor's employees is dust generated during laboratory soldering
processes. The Company strictly complies with the Law of the People's Republic of China on the Prevention and Control of Occupational Diseases
and other applicable laws, regulations, and requirements. It has formulated internal policies and procedures such as the Laboratory Safety
Management Rules, and through systematic management measures provides comprehensive safeguards for all workplaces, building a stable
% 件
and reliable safety environment for both employees and the Company.
Employee medical Work-related injuries
check-up coverage rate and fatalities1
Southchip Semiconductor's Occupational Health and Safety Management Measures [1] A Company employee sustained a fracture as a result
of a traffic accident while commuting to work. Following
the incident, the Company has organized relevant
safety education and training to prevent similar
Office safety
incidents from recurring.
Conduct regular occupational health examinations for employees in roles
involving potential occupational disease risks Case
Provide employees in roles exposed to occupational disease risks with personal
protective equipment such as masks and earplugs, ensuring their safety Fire Drill Enhances Employee Fire
Engage qualified third-party professional agencies to conduct comprehensive Safety Awareness
assessments of the office environment in accordance with applicable national
standards, identifying and controlling potential occupational health risks
In November 2025, the Company, together with the property management
of the business park, conducted its annual fire drill. The drill systematically
included hands-on training in the use of fire-fighting equipment,
Laboratory safety emergency evacuation route drills, and early-stage fire suppression
exercises, effectively enhancing employees' fire safety awareness.
Scene from the Annual Fire Drill
Formulate policies and procedures such as the Laboratory Safety Management
Rules and the Safe Work Practice Standards, standardizing the use of
laboratory facilities and equipment to ensure electrical and fire safety
Regularly inspect and maintain safety protection facilities, ensuring that all
laboratory equipment remains free of safety hazards
Employee Training and Development
Actively conduct safety education and training to ensure that laboratory
personnel are fully versed in emergency response measures and procedures
Governance
Southchip Semiconductor places great emphasis on talent development, regarding it as an essential element of the Company's high-quality
growth. The Company has formulated internal policies and procedures such as the Training Management Standards and the Performance
Fire safety Management Standards, enabling the orderly management of employee training, promotion, performance appraisal, and incentives. The
Human Resources Department serves as the principal function responsible for Employee Training and Development, formulating talent
development pathways and incentive mechanisms, implementing the annual performance appraisal and training plans, and continuously
Conduct annual fire safety drills, supported by accompanying safety training,
enhancing employees' knowledge, job-specific skills, and motivation.
to enhance employees' fire safety awareness and capacity to respond to fire
incidents
Strategy
The Company is dedicated to cultivating a workplace culture of "lifelong learning". Guided by the talent philosophy of "selecting, developing,
and deploying talent based on core values", the Company provides all employees with a supportive training environment and fair
opportunities for career development. Recognizing that a scientifically grounded training and development management system better
enables employees to succeed and lays a solid foundation for technological upgrading across the industry, the Company periodically
reviews its employee training and performance management systems, identifies risks and opportunities on an annual basis, and analyzes
their impact scope and financial implications to achieve close alignment between corporate development and talent growth.
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
People-centered: Moving Forward Together
Southchip Semiconductor's Employee Training and Development – Risk and Opportunity Analysis
Southchip Semiconductor's 2025 Employee Training – Performance Highlights
Principal Risk /
Specific Description Scope of Impact Financial Impact
Opportunity
An underdeveloped training framework or inadequate
Talent management could slow the building of talent pipelines; Increased person-times
Medium term
development employees may be unable to acquire best practices or operating
risk standard processes through training, leading to low Long term costs
efficiency and higher error rates New training courses Training participation
Organizational A fair and equitable performance management system Short term Decreased
management helps energize employees and enhances overall operational Medium term operating
opportunity efficiency costs
Long term
Case
Empowering new Scer – Helping
New Hires Hit the Ground Running
Impact, Risk, and Opportunity Management
In 2025, 167 new Scer (new-hire graduates) from across the country completed a three-day onboarding program held in Shanghai,
Employee Training Management Shenzhen, and Chengdu. The program centered on four core modules – decoding the corporate culture and values, a panoramic overview
of the Company's departments, professional capability building, and career development roadmaps – and, through a dual-track model of
The Company continues to expand its investment in training programs, "classroom instruction + cultural co-creation", helped employees translate cultural values from concepts into behavioral principles, integrate
providing diversified training initiatives for employees at different positions rapidly into their teams, and define clear growth pathways.
and career stages. These programs are designed to help new hires adapt
quickly, enhance employees' overall capabilities, and strengthen their
professional skills, enabling employees and the Company to grow together.
Southchip Semiconductor's Employee Training Framework
New employee General knowledge Technical
training training training
A Debate Held on the Topic: "Should Job Rotation Exemptions Be Introduced"
Provides an introduction to the Cover topics including patents, Offer technical training for new
Company's history, organizational information security, trade secrets, graduates, aiming to equip them
structure, corporate culture, rules, and codes of conduct. All with professional skills and to
and regulations employees are required to complete internalize the Company's
the training via the online learning advanced technologies through
Implement a "mentorship program" platform and pass the systematic training covering digital
that pairs experienced and corresponding assessments design, analog design, and system
knowledgeable employees with applications
new hires. Through knowledge
sharing, targeted guidance, and Provide specialized skills training for
training, the program helps new roles in product quality and R&D,
employees acclimate to the drawing on internal and external
Deconstructing the Company's Business Processes from Three Perspectives: Designing cultural posters on the theme
Company and transition into their resources to deliver targeted "How the Outside Sees Southchip", "Southchip Through Our Own Eyes", and "We "Southchip and me in 2030"
new roles as quickly as possible capability building and strengthen Are Building Southchip"
employees' core technical skills
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
People-centered: Moving Forward Together
Performance Appraisal and Career Advancement Metrics and Targets
To enhance training quality and strengthen performance management, the Company sets systematic training and development metrics
Building on the Company's overall business objectives and key performance and targets at the beginning of each year. It continuously tracks progress against key indicators and implements targeted management
indicators, Southchip Semiconductor cascades these targets down to each measures to ensure the successful achievement of annual targets.
department and team, establishing an "objective-oriented" performance
appraisal system that enables coordinated development at the individual,
team, departmental, and Company levels. The Company has built a Southchip Semiconductor's 2025 Employee Training and Development Metrics and Targets
multi-dimensional performance appraisal system that evaluates the
achievement of "individual performance targets" and the fulfillment of "job
Annual Target Progress Annual Target Progress Annual Target Progress
responsibilities and above-and-beyond contributions", and combines this
≥80 100 100
with multi-source feedback from direct line managers, cross-functional
Achieved Achieved Achieved
managers, and project managers, thereby providing a comprehensive and
% % %
objective reflection of each employee's overall annual performance.
Company leaders communicate regularly with employees on the progress of Rolling training plan Completion rate of annual Coverage rate of annual
their performance objectives, helping employees gain a clear understanding implementation rate1 mandatory training performance appraisal
of their strengths and development areas in leadership and professional
[1] Rolling training plan implementation rate = Number of training courses delivered / Number of training courses scheduled in the rolling training plan × 100%
skills, and ultimately enabling the enhancement of individual capabilities
and the achievement of annual targets.
For employees who wish to contest their performance appraisal results, the
Company has established a performance appraisal appeal channel and
formed a Performance Appeal Committee to conduct investigations and
gather evidence. The Performance Appeal Committee undertakes
multi-party investigations on an objective and impartial basis and provides
Community Engagement and Philanthropy
final feedback on appeals within 3 working days.
Southchip Semiconductor's Performance Appraisal Principles
Guided by a strong sense of responsibility, Southchip Semiconductor is committed to harmonizing corporate development with social
responsibility. The Company encourages employees to participate in volunteer activities and public welfare initiatives, and – through
donations in fields such as healthcare – continues to contribute to society, earnestly fulfilling its corporate social responsibility and driving
shared social value creation. In 2025, the Company's total charitable donations amounted to approximately RMB114,800.
Southchip Semiconductor's 2025 Donation Details
Accountability and Hierarchical and Objectivity and
results-oriented principle graded principle fairness principle
Performance is guided by Control the distribution ratio Comprehensively and Participated in the
accountability outcomes, of performance evaluation thoroughly understand
"Xingan Baby Care Program"
encouraging employees to results by hierarchy and level employees’ work and provide
make individual contributions objective and fair overall
based on their job
responsibilities and roles
evaluations
contributing
资助
RMB 100,000
in support of children with liver disease from financially disadvantaged families
To further energize the organization, strengthen internal mobility, and develop multi-disciplinary talent, the Company has formulated and Donated
implemented the Implementation Rules for Employee Job Rotation and Transfer. The rules establish three mechanisms: strategic rotation,
necessary rotation, and employee-initiated transfer – supporting employees in shaping their own career paths while promoting mutual
growth between the individual and the organization.
The Company has built open, transparent, and accessible career advancement pathways, offering parallel management and technical
RMB 14,827 to the Jiashan Fire Station Xingan Baby Care Program Donation Certificate
career tracks with a hierarchy of positions at each level within each track. This provides employees with clear guidance on career
progression and motivates them to pursue individual development in the fields best suited to their skills.
CHAPTER
Compliance Governance for
Stable Development
Corporate Governance
Compliant Operations and Risk Management
Business Ethics
Southchip, born for efficiency!
Southchip Semiconductor Technology (Shanghai) Co., Ltd.
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
Compliance Governance for Stable Development
Strategy
Compliance Governance for The Company recognizes that sound corporate governance is critical to long-term development and that inadequate governance could
undermine investor confidence, trigger abnormal share price volatility, and ultimately harm investor interests. Accordingly, the Company is
Stable Development
committed to optimizing its governance framework and enhancing operational discipline. By strengthening the division of responsibilities
among the Board of Directors, the Management, and functional departments, the Company ensures a transparent and efficient
decision-making process, enabling it to better respond to external risks and challenges and enhancing its market adaptability. In parallel, the
Company closely monitors industry trends and shifts in market demand, proactively identifying relevant risks and opportunities to ensure its
Corporate Governance ability to respond rapidly to changes in the external environment.
Southchip Semiconductor's Corporate Governance – Risk and Opportunity Analysis
A sound and scientifically designed corporate governance framework is the core engine driving a company's efficient operation and Regulatory penalty risk Operational efficiency opportunity
high-quality development. Southchip Semiconductor strictly complies with the Company Law of the People's Republic of China (hereinafter
the "Company Law"), the Securities Law of the People's Republic of China, the Rules Governing the Listing of Stocks on the STAR Market of the
Medium term / Long term Short term / Medium term / Long term
Shanghai Stock Exchange, the SSE Self-Regulatory Guidelines for Listed Companies No. 1 – Standardized Operations, and other applicable
laws, regulations, and requirements, strengthening its corporate governance performance and safeguarding the healthy and stable Non-compliant governance practices A robust governance structure helps
operation of the Company. or inaccurate information disclosure enhance operational efficiency and
Increased Decreased
could expose the Company to corporate transparency, further
operating operating
Governance regulatory warnings or penalties costs promoting the Company's healthy costs
development
To ensure the Company's ability to maintain long-term, stable operations in a complex and dynamic market environment, Southchip
Semiconductor has formulated a set of policies and internal procedures including the Articles of Association, the Rules of Procedure for the
Board of Directors, and the Information Disclosure Management Policy. These continuously enhance the Company's governance framework, Upholding the principles of efficient and transparent governance, the Company continues to strengthen its overall governance capabilities.
clearly delineating the functions and division of responsibilities among the Shareholders' Meeting, the Board of Directors, and the By focusing on optimizing the governance structure, safeguarding investor rights, and ensuring compliant information disclosure, the
Management, and safeguarding the Company's sustained, standardized, and healthy development. Company transforms governance risks into competitive advantages, ensuring long-term competitiveness and a strong reputation in global
markets.
In 2025, in accordance with the requirements of the Company Law, the Guidelines for Articles of Association of Listed Companies, and other
regulatory documents, the Company dissolved its Board of Supervisors, with the powers previously exercised by the Board of Supervisors
transferred to the Audit Committee of the Board of Directors. The Articles of Association and other relevant policies and internal procedures
were amended accordingly, effectively enhancing internal operational efficiency and transparency and better enabling the Company to Impact, Risk, and Opportunity Management
respond to external challenges and market changes. The Company has established four committees under the Board of Directors – the
Strategy Committee, the Audit Committee, the Nomination Committee, and the Remuneration and Appraisal Committee – which provide Governance Structure Optimization
professional advice and recommendations to support the Board's decision-making and safeguard the democratic and scientific nature of
collective Board decisions. The Nomination Committee, Audit Committee, and Remuneration and Appraisal Committee under the Board of Directors are each chaired
by Independent Directors. The Articles of Association explicitly provide for the adoption of a cumulative voting system, ensuring the fairness
and standardization of the election of Board of Directors' members.
Southchip Semiconductor's Corporate Governance Structure In building the Board of Directors, the Company places emphasis on independence and diversity, forming a member composition that is
aligned with the needs of business operations and management. Independent Directors account for one-third of the Board, all of whom
possess industry-specific expertise, financial and accounting experience, and other professional qualifications, providing robust support for
the Company's risk management and strategic decision-making. The Company has also built a gender-balanced Board, with 2 female
directors, effectively safeguarding the diversity of Board composition.
Shareholders' meeting
Composition of Southchip Technology's Board of Directors in 2025 and the Convening of Related Meetings
Board of Directors
Of which,
independent Shareholders' Meetings Board meetings
directors: 3
held: held:
Strategy Audit Nomination Remuneration and
Committee Committee Committee Appraisal Committee
Number of Resolutions reviewed at the Resolutions reviewed by
Management Of which,
directors: 9
Of which,
Shareholders' Meeting:
non-independent female
directors: 6 directors: 2
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
Compliance Governance for Stable Development
Information Disclosure Management Southchip Semiconductor's 2025 Investor Relations Management – Performance Highlights
The Company has formulated the Information Disclosure Management Policy and proactively discloses all information that may have a
material impact on the decision-making of shareholders or other stakeholders, ensuring timely and equitable disclosure, and safeguarding Held 3 results briefings
the authenticity, accuracy, and completeness of disclosed information. In 2025, the Company did not commit any violation of information
disclosure requirements, including any false records, misleading statements, or material omissions.
Southchip Semiconductor's Information Disclosure Channels
RMB 0.20 (before tax); RMB 84,790,004.40 (before tax)
Management of Related-Party Transactions
Listed company Investor exchange Earnings On-site Investor Investor SSE E-Interaction To standardize and reduce unnecessary related-party transactions, the Company has formulated the Related-Party Transaction Management
announcements meetingsb briefings inspections hotline email platform and others Policy, clearly setting out key elements such as approval authorities and disclosure requirements for related-party transactions, and
periodically identifying and maintaining the list of related parties in order to mitigate the risk of omissions in disclosure. In 2025, all
day-to-day related-party transactions and other related-party capital flows were assessed and audited by qualified third-party firms,
ensuring that no situation adversely affecting the interests of the Company or its other shareholders existed, and that such arrangements
are consistent with the interests of all shareholders and the Company's long-term development strategy.
【Case】Information Disclosure Training Enhances
Employee Compliance Awareness 【Case】Conducted training on the “Related Party Transaction Management
Policy” to enhance employees’ risk prevention capabilities
In December 2025, to comprehensively standardize the Company's information disclosure
activities and enhance cross-functional awareness of collaboration in information disclosure, the
Company conducted dedicated information disclosure training for relevant employees. The In August 2025, the Company conducted training on the “Related Party Transaction Management
training provided a detailed introduction to the principal types of information disclosure, common Policy”. By analyzing typical scenarios — such as failure to promptly identify related parties resulting in
scenarios and compliance requirements, and the determination of liability for violations, laying a backdated procedures, and unfair pricing leading to compliance risks — the training reinforced
solid foundation for compliant Information Disclosure Management practices. participants’ compliance awareness that “identification must precede transactions”. This training
effectively enhanced the Company’s internal capacity to prevent potential risks, including the
concealment of related party relationships and improper benefit transfers, further solidifying the
foundation for a long-term sound corporate governance mechanism and ensuring compliant, stable
operations.
Southchip Semiconductor's 2025 Information Disclosure Management – Performance Highlights
Metrics and Targets
Achieved a Grade A rating in information disclosure Disclose
The Company has established governance- and disclosure-related targets for the Board of Directors and information disclosure,
continuously refining its governance structure and decision-making mechanisms and ensuring the compliance of information disclosure. In
periodic interim
assessment for the consecutive year reports announcements
Southchip Semiconductor's 2025 Corporate Governance Metrics and Targets
Metric Unit Annual Target Progress
Investor Relations Management
The Company respects and fully safeguards the rights of all shareholders as the Company's owners, and protects the equal standing of
Percentage of independent directors1 % 1/3 Achieved
minority shareholders. While ensuring the lawful and effective convening of General Meetings of Shareholders, the Company provides
online voting, offering a convenient means for minority shareholders to participate in voting and enabling them to deliberate on the
Company's major resolutions through both online and on-site voting.
The Company places great importance on delivering reasonable investment returns to its investors. The Board of Directors formulates a Disclosure rate of the Company's
% 100 Achieved
shareholder return plan once every three years, and in 2025 publicly disclosed the Shareholder Dividend Return Plan for the Next Three Years material matters
(2025–2027), ensuring the continuity and stability of its shareholder dividend policy. In 2025, the Company successfully implemented the
distribution policy, further enhancing investors' sense of returns. [1] Percentage of independent directors = Number of independent directors on the Board of Directors / Total number of Board of Directors' members × 100%
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
Compliance Governance for Stable Development
Compliant Operations and Risk Management
The Company continuously refines its risk management processes to ensure that relevant risks are appropriately controlled and mitigated.
The Company's enterprise risk management process comprises three steps: risk identification, risk assessment, and risk monitoring. Through
end-to-end closed-loop management and periodic reassessment mechanisms, the process provides a solid foundation for business
continuity and stable development.
Southchip Semiconductor consistently regards risk management and compliant operations as cornerstones of the Company's development. To safeguard business continuity and enhance risk prevention and control capabilities, the Company has formulated policies and internal
The Company continues to deepen the development of its internal control system, comprehensively enhancing operational transparency procedures such as the Business Continuity Management Procedure, covering all operational functions including R&D, supply, production
and standardization, and strictly adheres to domestic and overseas laws, regulations, and regulatory requirements. By continually operations, procurement, and IT, ensuring rapid response and the restoration of critical business activities in the face of unexpected events.
strengthening its global business compliance defenses, the Company seeks to safeguard high-quality, sustainable development through a
robust governance structure.
The Company strictly upholds its internal control defense line in business operations. In accordance with the Basic Standard for Enterprise
Internal Control, the Guidelines for Enterprise Internal Control Assessment and the Internal Control Assessment System, it has formulated a
series of management documents governing daily work. It has also established a compliance monitoring mechanism led by the Internal
Control Department, with in-depth collaboration across multiple departments including Finance, Legal, and Human Resources. This Southchip Semiconductor's Risk Management Process
mechanism is designed to consolidate the internal control system, strengthen the effectiveness of compliance management, significantly
elevate the standard of lawful operations, and lay a solid foundation for the Company's sustained, healthy development.
Southchip Semiconductor's Internal Control Management System
Establish a normalized risk assessment mechanism to comprehensively identify potential risks in
daily operations
Business activities Business support Risk identification Build and continuously iterate risk control matrices across business modules to achieve
visualized risk management and control, ensuring dynamic optimization of the internal control
Sales and Procurement Research and Comprehensive system
Seal Contract
collection and payment development budget
management management
management
Business Production and Guaranteed Internal Information access
Management
outsourcing operation business information rights Quantitative assessment and visual presentation: evaluate risk impact and frequency to develop
of subsidiaries
communication management, etc.
risk maps
Asset Cash and funds Related-party Tiered strategies and targeted actions: focus on high-risk areas and implement targeted
management management transactions, etc.
Risk evaluation
measures to achieve closed-loop management
I n te r n a l co n t ro l t h rou gh ou t t h e e n t i re proce ss
Establish a regular reassessment mechanism for high-risk matters to review and verify the
Southchip Semiconductor's Principal Internal Control Management Measures effectiveness of response measures
Risk supervision Establish a dynamic cycle of "assessment – execution – verification" to ensure risks remain
controllable
Development of Risk assessment and Internal control oversight Internal control
internal control policies improvement initiatives culture development
In line with the Company's Conduct risk assessments of Day-to-day oversight: Develop Deliver training and Southchip Semiconductor's 2025 Compliant Operations and Risk Management – Performance Highlights
development, lead the the Company's day-to-day audit plans in line with awareness activities for all
formulation and issuance of operations business developments and employees based on
internal control-related policies carry out routine audits published internal control
Complete an internal control policies and procedural
Develop an internal self-assessment in line with Special oversight: Conduct documents
authorization framework, the requirements of the Basic thematic audits of high-risk In 2025, the Internal Control Service Desk circulated
periodically reviewing and Standard for Enterprise matters arising from internal Advance the cultivation of an
assessing authorization risks, Internal Control and the business activities internal control culture by
and updating and refining the continuously updating the
since 2024, a cumulative total of 11 cases have
Guidelines for Internal Control
framework in accordance with Evaluation, and prepare the internal control knowledge Conducted
business developments Internal Control base and relevant content on
Self-Assessment Report the Company's online
collaboration platform and
Assess and investigate items subscription channels, been circulated
requiring optimization in light progressively enhancing
of business realities, develop employees' internal control
dedicated improvement plans, awareness
and drive their
implementation
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
Compliance Governance for Stable Development
Business Ethics Southchip Semiconductor's Integrity Reporting Mailbox:
complain@southchip.com
Southchip Semiconductor attaches great importance to anti-corruption, anti-bribery, and anti-unfair competition. The Company strictly
complies with the Anti-Unfair Competition Law of the People's Republic of China, the Anti-Monopoly Law of the People's Republic of China, and
other applicable laws, regulations, and requirements. It has formulated internal policies and procedures such as the Employee Handbook
and the Business Ethics Code of Conduct, establishing a sound business ethics management framework to continuously enhance
management effectiveness and prevent unethical conduct. In 2025, the Company did not experience any incidents of commercial bribery or
corruption, and was not involved in any litigation or subject to any major administrative penalty arising from unfair competition. Signing rate of personal integrity
To effectively enhance employee integrity awareness, the Company conducts business ethics training for all employees. The training covers commitment letters
laws and regulations relating to commercial bribery, standards of conduct governing business dealings, and procedures for the receipt of
complaints and whistleblower reports. Drawing on real-world cases to analyze key management principles, the training effectively
strengthens employees' business ethics awareness and reinforces the Company's internal oversight. In 2025, the Company signed Integrity
Commitment Letters with all employees, under which they committed not to accept any non-compliant gifts, cash, entertainment, or
benefits in any other form, to eliminate corruption in all its forms, and to conduct business with integrity.
The Company conducts annual business ethics risk assessments covering the business activities and management processes of key
functions including R&D, procurement, sales, finance, and human resources. Guided by the assessment principles of "objectivity,
systematism, dynamism, transparency, and full participation", the Company comprehensively reviews the likelihood and severity of risks
such as corruption and money laundering, and deploys preventive measures and review plans to effectively respond to such risks, ensuring
that business ethics risks remain under control.
Southchip Semiconductor's 2025 Principal Business Ethics Risks and Response Measures
Category Risk Description Prevention, Control, and Review Plans
Accepting or giving high-value gifts, which may Establish a gift registration system with clearly defined
influence procurement or sales decisions maximum values for gifts
Corruption and
bribery risk Business hospitality exceeding standards, which may Periodically review expense reimbursement records to
involve improper benefit transfers assess compliance with the Company's hospitality
standards
Employees allowing personal interests to influence procurement Periodically review employee conflict-of-interest
or sales decisions declarations and conduct annual business ethics
Conflict of interest risk training for employees
Long-standing supplier relationships compromising Periodically review supplier and customer cooperation
procurement fairness records and conduct annual fairness audits
As a creditor, the Company may face difficulties in R&D personnel falsifying technical achievements to
recovering accounts receivable fraudulently obtain rewards
Fraud risk
R&D personnel falsifying technical achievements to All intellectual property outputs are subject to dual
fraudulently obtain rewards review by the business unit and an IP engineer
Unclear flow of funds in cross-border transactions, giving Conduct periodic financial audits of branches and
rise to suspicion of money laundering subsidiaries and review records of large capital flows
Corruption risk
Lack of transparency in the use of funds by branches and Establish an oversight mechanism for cross-border
subsidiaries, creating risks of illegal transactions capital flows, with all cross-border transactions subject
to internal review
The Company has established an Integrity Reporting Mailbox as the primary reporting channel, encouraging employees and all
stakeholders to report actual or suspected violations of professional ethics, business ethics, or related laws and regulations. Upholding the
principle of due prudence, the Company establishes dedicated investigation teams to handle and investigate all inquiries and reports
received. All investigations are conducted on a lawful and compliant basis and ensure the confidentiality of information within the limits
permitted by applicable laws and regulations. Retaliation against those who provide information or assist in investigations is strictly
prohibited, safeguarding the lawful rights and interests of whistleblowers.
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
ESG Data Table
ESG Data Table Usage of Water Resources Data Table
Disclosure Item Unit 2025
Total water consumption m3 3,337.44
Environmental Data Water consumption per unit of revenue1 m3 / RMB 1 million 1.02
[1] Water consumption per unit of revenue = Total water consumption / Operating revenue.
Environmental Compliance Management Data Table
Waste Management Data Table
Disclosure Item Unit 2025
Amount of major administrative penalties imposed by ecological, 披露项 单位 2025
environmental, and other relevant authorities as a result of RMB 10,000 0
environmental incidents during the Reporting Period Total waste disposed (general waste) Ton 68.94
Waste disposed per unit of revenue1 Tonnes / RMB 1 million 0.02
Climate Change Tackling Data Table [1] Waste disposed per unit of revenue = Total waste disposed / Operating revenue.
Disclosure Item Unit 2025
Total GHG emissions1 tCO2e 1,745.86 Social Data
-Scope 1 GHG emissions2 tCO2e 11.17
-Scope 2 GHG emissions3 tCO2e 1,734.69
R&D Innovation Data Table
GHG emissions per unit of revenue 4
tCO2e / RMB 1 million 0.54
[1] Total GHG emissions = Scope 1 GHG emissions + Scope 2 GHG emissions.
Disclosure Item Unit 2025
[2] Scope 1 GHG emissions refer to direct GHG emissions generated from gasoline combustion, including CO₂, CH?, and N₂O. The 2025 calculation uses the 100-year average Global Warming
Potential (GWP) values from IPCC AR6, and emission factors for each energy type are drawn from sources such as the China Energy Statistical Yearbook. Total R&D Personnel Persons 840
[3] Scope 2 GHG emissions refer to indirect GHG emissions generated from purchased electricity. The Company calculates GHG emissions from purchased electricity on a location-based
approach, with emission factors referencing the national average CO₂ emission factor for electricity published by the Ministry of Ecology and Environment and the National Bureau of
Percentage of R&D personnel1 % 68.13
Statistics in the Announcement on the Release of the 2023 CO₂ Emission Factors for Electricity.
[4] GHG emissions per unit of revenue = Total GHG emissions / Operating revenue.
R&D expenses amount RMB 10,000 64,714.51
R&D expenses ratio2 % 19.85
Energy Usage Data Table [1] Proportion of R&D personnel = Number of R&D personnel / Total number of employees * 100%
[2] R&D expenses ratio = R&D expenses / Operating revenue * 100%.
Disclosure Item Unit 2025
Intellectual Property Protection Data Table
Total energy consumption tce 407.57
-Gasoline L 5,044.22 Disclosure Item Unit 2025
-Purchased electricity MWh 3,269.29 Number of granted patents during the Reporting Period / 268
Direct energy consumption tce 5.49 Number of granted patents during the Reporting Period / 84
Indirect energy consumption tce 402.08 Number of valid patents during the Reporting Period / 199
Comprehensive energy consumption per unit of revenue1 tce/RMB 1 million 0.13 Number of valid invention patents during the Reporting Period / 183
[1] Comprehensive energy consumption per unit of revenue = Comprehensive energy consumption / Operating revenue. Number of software copyrights / 16
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
ESG Data Table
Product and Service Quality Management Data Table Employee Management Data Table（Continued from previous page ）
Disclosure Item Unit 2025 Disclosure Item Unit 2025
Product Quality Management Occupational Health and Safety
Amount involved in major safety and quality liability incidents related
RMB 10,000 0 Amount invested in work injury insurance RMB 10,000 75.21
to products and services during the Reporting Period
Number of major product- and service-related safety and quality
/ 0 Employee work-related injury insurance coverage rate % 100
liability incidents during the Reporting Period
Service Quality Management Number of occupational disease cases Persons 0
Overall customer satisfaction % 91 Occupational disease incidence rate % 0
Number of deaths due to work-related causes Persons 0
Data Table for Information Security and Privacy Protection
Employee Training Coverage Rate
Disclosure Item Unit 2025 Total number of employees receiving training Persons 1,233
Number of data security incidents during the Reporting Period / 0
Male Persons 894
By gender
Amount involved in data security incidents RMB 10,000 0
Female Persons 339
Number of customer privacy breach incidents during the Reporting Period / 0
Number of employee training sessions Time 79
Amount involved in customer privacy breach incidents RMB 10,000 0
Coverage of employee training % 100
[1] Employee turnover rate = Number of employee departures / (Total number of employees + Number of employee departures) * 100%.
Supply Chain Management Data Table
Disclosure Item Unit 2025
Community Engagement and Philanthropy Data Table
Total number of suppliers Companies 110
Disclosure Item Unit 2025
-Mainland China Companies 98
Amount of charitable donations RMB 10,000 11.48
-Hong Kong, Macao, Taiwan, and overseas Companies 12
Proportion of local suppliers % 89.09
Governance Data
Employee Management Data Table
Disclosure Item Unit 2025 Business Ethics Data Table
Employee Management Disclosure Item Unit 2025
Number of employees covered by anti-bribery and anti-corruption
Total Number of Employees Persons 1,233 Persons 1,233
training
Percentage of employees covered by anti-commercial bribery and
Male Persons 894 % 100
anti-corruption training1
By gender
Number of directors covered by anti-bribery and anti-corruption
Female Persons 339 Persons 9
training
Percentage of management personnel covered by anti-bribery and
Under 30 Persons 623 % 100
anti-corruption training1
Number of management personnel covered by anti-bribery and
By age Aged 30 to 50 Persons 604 Persons 194
anti-corruption training
Proportion of management members covered by anti-commercial
Over 50 years old Persons 6 % 100
bribery and anti-corruption training1
Number of commercial bribery and corruption incidents during the
Number of minority employees Persons 38 / 0
Reporting Period
Number of litigation cases or major administrative penalties arising from
Number of employee turnover Persons 123 / 0
the Company's unfair competition practices during the Reporting Period
Employee turnover rate1 % 9.07 [1] Percentage of employees in each category receiving anti-bribery and anti-corruption training = Number of employees in that category who received training / Total number of employees
in that category * 100%.
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
Disclosure Index
Disclosure Index GRI Disclosure Index
Southchip Semiconductor has prepared this Report with reference to the Global Reporting Initiative (GRI)
Instructions for use Standards for the period from January 1, 2025 to December 31, 2025
GRI 1 used GRI 1: Foundation 2021
Guidelines No. 14 of Shanghai Stock Exchange for Self-Regulation of Listed
Companies—Sustainability Report (Trial) – Disclosure Index GRI Standards Disclosure Item
Report Chapter,
Additional Notes
About Southchip
Disclosure Requirement Report Chapter, Additional Notes
The 21 Topics Set Out in the SSE Guidelines
Climate Change Tackling
Climate change tackling
ESG Data Table 2-4 Restatements of information About This Report
Pollutant Discharge and Waste Disposal
Pollutant discharge
ESG Data Table 2-5 External assurance Not conducted
Pollutant Discharge and Waste Disposal
Waste disposal About Southchip
ESG Data Table 2-6 Activities, value chain and other business relationships
None of the Company's operating sites are located within key protected areas, and its production and operational Semiconductor
Ecosystem and biodiversity protection activities do not have any significant negative impact on ecosystems or biodiversity. Accordingly, this topic has not
been included as an ESG topic of the Company. 2-7 Employees Employee Rights and Benefits
Environmental Compliance Management
Environmental compliance management
ESG Data Table 2-8 Workers who are not employees Employee Rights and Benefits
Energy and Resources Usage
Energy usage
ESG Data Table 2-9 Governance structure and composition ESG Management
Energy and Resources Usage
Usage of water resources
ESG Data Table 2-10 Nomination and selection of the highest governance body Corporate Governance
Circular economy Pollutant Discharge and Waste Disposal
During the Reporting Period, the Company had not yet undertaken initiatives related to rural revitalization, and 2-11 Chair of the highest governance body Corporate Governance
Rural revitalization plans to carry out such initiatives in future years.
Community Engagement and Philanthropy of impacts
Contributions to the society
ESG Data Table
GRI 2: General 2-13 Delegation of responsibility for managing impacts ESG Management
Innovation-driven Development
Innovation-driven Disclosures 2021
ESG Data Table
The Company's principal business is the R&D, design, and sale of analog and embedded chips. It does not engage 2-14 Role of the highest governance body in sustainability reporting ESG Management
Ethics of science and technology in fields such as gene editing or artificial intelligence ethics, nor do its operating activities involve technology
ethics-related topics. Accordingly, this topic has not been included as an ESG topic of the Company.
Supply Chain Management 2-15 Conflicts of interest ESG Management
Supply chain security
ESG Data Table
In 2025, the Company and its subsidiaries did not publicly disclose any overdue outstanding payments owed to 2-16 Communication of critical concerns ESG Management
Equal treatment to small and SMEs through the National Enterprise Credit Information Publicity System. As of the end of 2025, the balance of
medium-sized enterprises the Company's accounts payable (including notes payable) did not exceed RMB30 billion, nor did it exceed 50%
of total assets. 2-17 Collective knowledge of the highest governance body Not disclosed
Product and Service Quality Management
Safety and quality of products and services
ESG Data Table 2-18 Evaluation of the performance of the highest governance body ESG Management
Information Security and Privacy Protection
Data security and customer privacy protection
ESG Data Table 2-19 Remuneration policies Not disclosed
Employee Rights and Benefits
Occupational Health and Safety 2-20 Process to determine remuneration Not disclosed
Employees
Employee Training and Development
ESG Data Table
Due diligence ESG Materiality Assessment
Communications with stakeholders ESG Materiality Assessment 2-22 Statement on sustainable development strategy Chairman's Message
Business Ethics
Anti-commercial bribery and anti-corruption
ESG Data Table 2-23 Policy commitments ESG Management
Business Ethics
Anti-unfair competition
ESG Data Table 2-24 Embedding policy commitments ESG Management
Voluntarily Disclosed Topics
Intellectual Property Protection
Intellectual property protection
ESG Data Table 2-26 Mechanisms for seeking advice and raising concerns Business Ethics
Corporate governance Corporate Governance
Compliant operations and risk management Compliant Operations and Risk Management Management
Southchip Semiconductor 2025 Environmental, Social, and Governance (ESG) Report
Disclosure Index
Continued from previous page Continued from previous page
Report Chapter, Report Chapter,
GRI Standards Disclosure Item GRI Standards Disclosure Item
Additional Notes Additional Notes
GRI 2: General Disclosures 2-29 Approach to stakeholder engagement ESG Management GRI 301: Materials 2016 301-2 Recycled input materials used Not disclosed
ESG Data Table
Energy and Resources Usage
GRI 3: Material Topics 2021 3-2 List of material topics ESG Management 302-2 Energy consumption outside of the organization
ESG Data Table
Energy and Resources Usage
ESG Data Table
Company's day-to-day operations
are not located within ecological
GRI 101: Biodiversity 2024 involve key marine ecological
or other ecologically sensitive and 2018
fragile areas. The impact on
Energy and Resources Usage
ESG Data Table
Climate Change Tackling
ESG Data Table
Semiconductor 2025 Annual Report ESG Data Table
GRI 201: Economic to climate change
Performance 2016 Climate Change Tackling
ESG Data Table
Semiconductor 2025 Annual Report
GRI 202: Market Presence local minimum wage
community significant air emissions
Community Engagement and Pollutant Discharge and Waste
GRI 203: Indirect Economic Philanthropy Disposal
Impacts 2016 Community Engagement and Pollutant Discharge and Waste
Philanthropy Disposal
GRI 204- Procurement Pollutant Discharge and Waste Disposal
Practices 2016 ESG Data Table
Disposal
Communication and training about anti-corruption policies Business Ethics Pollutant Discharge and Waste Disposal
GRI 205: Anti-corruption 2016 205-2
ESG Data Table
and procedures ESG Data Table
Business Ethics New suppliers that were screened using environmental
ESG Data Table criteria
Environmental Assessment
GRI 206: Anti-competitive 206-1 Legal actions for anti-competitive behavior, anti-trust and Business Ethics 2016 308-2 Negative environmental impacts in the supply chain and Not disclosed
Behavior 2016 monopoly practices actions taken
Compliant Operations and Risk Employee Rights and Benefits
Management ESG Data Table
Compliant Operations and Risk Benefits provided to full-time employees that are not provided
Management to temporary or part-time employees
GRI 207: Tax 2019
issues
GRI 402: Labor-Management 402-1 Minimum notice periods regarding operational changes Employee Rights and Benefits
Relations 2016
Continued from previous page
Report Chapter,
GRI Standards Disclosure Item
Additional Notes
investigation
occupational health and safety
GRI 403: Occupational 403-5 Worker training on occupational health and safety Occupational Health and Safety
Health and Safety 2018
impacts directly linked by business relationships
Workers covered by an occupational health and
safety management system
Employee Training and Development
ESG Data Table
GRI 404: Training and 404-2 Programs for upgrading employee skills and transition Employee Training and Development
Education 2016 assistance programs
career development reviews
GRI 405: Diversity and Equal ESG Data Table
Opportunity 2016
GRI 406: Anti-discrimination 406-1 Incidents of discrimination and corrective actions taken Employee Rights and Benefits
GRI 407: Freedom of Association and 407-1 Operations and suppliers in which the right to freedom of Employee Rights and Benefits
Collective Bargaining 2016 association and collective bargaining may be at risk
Operations and suppliers at significant risk for incidents of
GRI 408: Child Labor 2016 408-1 Employee Rights and Benefits
child labor
GRI 409: Forced or Compulsory Labor 409-1 Operations and suppliers at significant risk for incidents of Employee Rights and Benefits
GRI 410: Security Practices 410-1 Security personnel trained in human rights policies or N/A
GGRI 411: Rights of 411-1 Incidents of violations involving rights of indigenous peoples N/A
Indigenous Peoples 2016
GRI 413: Local Communities assessments, and development programs Philanthropy
impacts on local communities Philanthropy
GRI 414: Supplier Social
Assessment 2016 Negative social impacts in the supply chain and actions
taken
GRI 415: Public Policy 2016 415-1 Political contributions N/A
GRI 416: Customer Health service categories Management
and Safety 2016 Incidents of non-compliance concerning the health and Product and Service Quality
safety impacts of products and services Management ESG Data Table
labelling
GRI 417: Marketing and 417-2 Incidents of non-compliance concerning product and service Not disclosed
Labeling 2016 information and labelling
communications
Substantiated complaints concerning breaches of customer Information Security and Privacy Protection
GRI 418: Customer Privacy 418-1
privacy and losses of customer data ESG Data Table
Leveraging chip technology to
optimize energy transformation efficiency
Contact Us
Service Hotline: 021-38067888
Headquarters Address: 12th Floor, Building 4, No. 54, Lane 565 Shengxia Road, China (Shanghai)
Pilot Free Trade Zone
Company official website: www.southchip.com
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