Fiscal Year
Contents
ESG Governance Environmental
Introduction
Arrangements Issues Social Issues
About This Report
Chairman’s Message BOD’s Statement Climate Change Response Social Responsibility
About Hangcha Governance Structure Pollutant Emission & Waste Management Innovation-driven Development
Analysis of Issue Importance Governance Competency Ecosystem & Biodiversity Conservation Technology Ethics
Analysis of Dual Importance Information Reporting, Supervision Environmental Compliance Management Supply Chain Security
& Assessment Mechanism
Communication with Stakeholders Energy Utilization Equal Treatment of SMEs
Issue Importance Analysis Conclusions Water Resources Utilization Product & Service Safety and Quality
Circular Economy Data Security & Customer Privacy Protection
Employees
Governance Issues
Standardized Operation
Risk Management & Internal Control
Business Ethics
Sustainable Development
Report Index Table
Feedback Form
Introduction
About This Report Preparation Criteria
This is the “Environment, Social and Governance” (ESG) report issued by Hangcha Group This report is prepared in accordance with the requirements of the Self-Regulatory
Co., Ltd., and it aims to demonstrate Hangcha Group’s practices and achievements in Guidelines for Listed Companies on the Shanghai Stock Exchange No. 14 - Sustainable
sustainable development and disclose the Group’s work in environment, society and Development Report (For Trial Implementation) and Self-Regulatory Guidelines for Listed
governance during the Fiscal Year 2025 and previous years. Companies on the Shanghai Stock Exchange No. 4 - Sustainable Development Report
Preparation issued by the Shanghai Stock Exchange.
Report Scope
Notes on Appellation
This report covers Hangcha Group Co., Ltd. and its subsidiaries. The reporting period ranges
from January 1, 2025 to December 31, 2025. To enhance the readability of the report, some For the convenience of expression and reading, “Hangcha Group”, “the Group”, “Hangcha",
content or data may be traced back to previous years or projected to subsequent years. “the Company” and "We" in this report all refer to Hangcha Group Co., Ltd. In addition, these
forward-looking descriptions related to business plan and development strategy etc. in this
report are the Company's predictions of future events based on real situations at that
moment, which may be affected by unknown and uncertain factors, thus leading to significant
differences from the actual results. For this reason, such descriptions do not constitute a
Data Sources substantive commitment of the Company to investors.
Unless otherwise specified, all information and data in this report are sourced from periodic
reports or interim announcements disclosed by the Company, as well as the environmental,
social and governance information that has been collected, consolidated, and audited by the Report Access
Company. Unless otherwise stated, all the monetary amounts in this report are denominated
in Renminbi (RMB). This report is available for downloading and viewing on the official website of the Shanghai
Stock Exchange (www.sse.com.cn) and the corporate website of Hangcha Group Co., Ltd.
(www.zjhc.cn).
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Chairman's Message
Distinguished Shareholders, Partners, All Employees and
Friends of All Walks of Life: Fulfilling Social Responsibility through Win-win Outlook for 2026: Staying true to original
Cooperation to Build a Harmonious Ecosystem aspiration to fulfill the mission, forging ahead
with determination to write a new chapter
for Hangcha Group to forge ahead against headwinds and take the society. In 2025, we kept improving talent echelons, with 2026 is the starting year of the 15th Five-Year Plan. We will
lead in innovation amid a severe market environment. In face of employee size exceeding 7,200 persons. Nearly 100 lead development with new energy equipment, accelerate
global economic volatility and industrial pressure, we always uphold high-caliber talents with doctoral and master’s degrees the upgrading of lithium and hydrogen energy products,
the vision of “Becoming the World’s Strongest Forklift Enterprise" to were newly recruited, together with top-notch talents in AI and promote the application of embodied intelligent
stay committed to green intelligent manufacturing and technological and algorithms, empowering the Company’s intelligent industrial robots (EIIR) and other cutting-edge intelligent
innovation. As a result, we have delivered high-quality development transformation. We innovated in talent mechanisms and technologies while making breakthroughs in intelligent
outcomes in global expansion. These achievements stem from the became one of Zhejiang Province’s first enterprises logistics. We will further go global and keep implementing
dedication of all Hangcha staff, the trust and support from partners, qualified for direct vocational skill level recognition, the localization strategies, in order to build new
as well as extensive recognition and solicitude from society. On enabling more skilled talents to rank among the best. As a international growth engines centering on new energy. We
behalf of the Board of Directors (BOD), I would like to express my member of Hangzhou Assistance Alliance, we promoted will further optimize ESG governance, integrate
sincere gratitude to all of you! paired assistance for rural revitalization of Zitong Town, sustainable development into strategic decisions and
Tianmushan Town and other regions, boosting common daily operations, meeting the capital market’s
prosperity through industrial and consumption expectations with higher transparency.
assistance. Besides, we organized staff sports events and
improved health management rules, integrating family
Driving Low-carbon Transition via Green Innovation culture into the workplace and building a diverse,
to Safeguard Lucid Waters, Lush Mountains inclusive and healthy working environment. Dear colleagues, sustainable development is not an
option but a must-do thing for long-term corporate
In 2025, we firmly believe green development is the foundation development. Hangcha will stay true to its original
of corporate development and also the source of core aspiration, protect the lucid waters and lush mountains
competitiveness. We launched a total of 60-odd new products through technological innovation, empower global
and technologies throughout the year. The world’s first industrial chains with open cooperation, and create a
mass-produced X-series hybrid forklift adopts a dual-power better life via fulfillment of corporate responsibilities. Let’s
system of “Diesel and Lithium Battery Energy Storage”, Shoring up Governance via Digital-Intelligent work together to write a new chapter for the green
bringing down fuel consumption by 40% compared with Integration to Drive Global Breakthroughs transition of Chinese intelligent manufacturing!
traditional internal combustion forklifts. The Company’s
self-developed humanoid logistics robot was officially launched In 2025, the Company’s global strategy upgraded from
at Shanghai CEMAT Exhibition, drawing widespread attention product export to technology & capital export. The main
from the industry. High-voltage lithium off-road forklifts, 4-wheel construction of the Thailand production base was
short-wheelbase lithium-ion forklift and other products meet completed, and overseas subsidiaries in 8 countries
diversified global demands, expanding green power application including France, Vietnam and Malaysia were put into
in mining, infrastructure and North American markets. It is worth operation one after another. Together with 20-odd
pointing out that the national standard Quantification Methods overseas subsidiaries and 700-odd global dealers, we built
and Requirements for Product Carbon Footprint of Greenhouse an efficient global service network. More notably, we
Gases – Industrial Vehicles, for which Hangcha led the established a joint venture with Manitou Group in France,
preparation, passed preliminary expert review. This fills focusing on lithium-ion battery manufacturing for
industrial gaps and provides scientific support for carbon industrial vehicles, and it is estimated that the JV firm has
reduction and carbon trading, exemplifying the Company’s an annual capacity of 50,000 sets in 2026, marking the
technological foresight and industrial responsibility in Company’s crucial step to go global. In digital governance,
low-carbon development. an industrial Internet platform with an investment of over
process of R&D, procurement, production and sales. Hangcha Group Co., Ltd.
AI-enabled industrial vertical knowledge mapping helped
greatly improve management efficiency and risk control Chairman: Zhao Limin
competence.
April 2026
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
About Hangcha
Founded in 1956, Hangcha Group Co., Ltd. is a high-end equipment manufacturing enterprise with a development
history of nearly 70 years and technological practices of 50 years in industrial vehicle R&D. The Company was
listed on the main board of Shanghai Stock Exchange (A-share market) in December 2016 (stock name: Hangcha
Group, stock code: 603298). For total product sales and export, the Company has ranked among the top in the
domestic industry for more than 10 years. According to the revenue-based ranking of global forklift enterprises
released by the U.S. magazine MMH-Modern Materials Handling, Hangcha Group is rated 8th globally.
Focusing on global technological resources, the Company independently builds three vehicle platforms (namely,
battery, hydrogen energy, and hybrid) while centering on new energy technologies such as battery, electric drive,
and electronic control. It also opens up new tracks in intelligent logistics to foster new growth drivers and
competitive edges. The Company took the lead worldwide in launching a series of self-developed innovative
products, including lithium battery dedicated forklifts, high-voltage lithium forklifts, and hydrogen fuel cell forklifts. rk Qingshan Industrial Park Shiqiao Sc
cience Pa ience & Inn
In intelligent material handling, the Company provides customers with full-stack total intelligent logistics solutions Hengfan S ovation Pa
rk
covering intelligent AGV, forklift robots, humanoid robots, automated high-bay warehouses, and smart logistics
systems. In 2025, the Company further expanded the boundaries of intelligent logistics with the global debut of the
X1 series logistics humanoid robot. This marks the Company’s strategic upgrade from a traditional industrial
vehicle manufacturer to an all-scenario intelligent logistics solution provider, representing a key milestone in the
embodied intelligence industry.
As a national high-tech enterprise and a key enterprise incubated for Zhejiang’s equipment manufacturing industry, RMB billion
the Company has capitalized on a number of technological innovation platforms (including the nationally
accredited enterprise technology center, nationally recognized laboratory, national postdoctoral research station, Hangcha Group was Registered Capital: RMB Hangcha Group ranks 8th
national industrial design center, Zhejiang key enterprise research institute and provincial-level academician founded in 1956 1.31 billion in the world.
workstation for intelligent industrial vehicles) to develop a full range of industrial vehicles covering 1t–48t
counterbalance forklifts, container reach stackers, empty container handlers, tractors, warehouse trucks, aerial
work platforms, dynamic compactors, cleaning equipment, AGVs, forklift robots and humanoid robots. To date, the
Company has established a modern industrial vehicle system with important global influence. Corporate Culture
The Company has been conferred numerous honorary titles, including China Top 500 Manufacturing Enterprises,
China Top 500 Private Enterprises, China Top 500 Large Enterprise Groups in Competitiveness, National Corporate Mission Making Handling Easier
Single-item Champion Demonstration Enterprise in Manufacturing, and National May 1st Labor Medal. It has been
recognized as a Zhejiang Future Factory, winner of the Zhejiang Provincial Government Quality Management Specialized Production, Brand-oriented Operation, Group-based
Development Strategy
Innovation Award, and listed as a Core Leading Factory under Hangzhou’s Future Factory initiative. Management, International Integration
New Energy Vehicles, Smart Logistics, Aftermarket Services,
The Company strives to optimize its global operation and service system and drive dual growth in domestic and Core Sectors
Construction Machinery, Core Components, Cleaning Equipment
overseas markets. It has established more than 20 directly-owned subsidiaries in Germany, the United States,
Canada, Mexico, Australia, Brazil, the Netherlands, Thailand, Japan, Indonesia and other regions, enabling its
Corporate Spirit Enterprising, Pragmatic, Innovative, Harmonious
self-owned marketing service network to fully cover key global industrial vehicle markets across Europe, North
America, South America, Australia and Southeast Asia. Currently, the Group operates over 100 direct sales
branches and more than 700 authorized dealers worldwide, delivering high-quality, high-efficiency, full-value-chain Corporate Vision To become the world’s strongest forklift enterprise
services to global customers.
Aside from dedicating itself to the mission of "Making Handling Easier", Hangcha Group persists in its development
strategy of “Specialized Production, Brand-oriented Operation, Group-based Management, International
Integration”. The Company focuses on six core business segments namely new energy vehicles, smart logistics,
aftermarket services, construction machinery, core components and cleaning equipment. Upholding the corporate
spirit of “Enterprising, Pragmatic, Innovative, Harmonious”, Hangcha creates value, gives back to society, and
strives to fulfill its vision of “Becoming the World’s Strongest Forklift Enterprise”.
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Major Honors in 2025 During the reporting period, the Company, by virtue of its outstanding strengths and innovative
achievements, earned a host of honors across multiple fields, demonstrating robust industrial
competitiveness and social influence. It has been accredited as a national service-oriented
manufacturing enterprise and listed among the 2025 Top 500 Chinese Machinery Enterprises and
World-Class Machinery Enterprises. Other honors include Zhejiang Famous Brand in Export, 2025
Top 500 Creditworthy Listed Companies in China, the 14th Top 100 Main Board Listed Companies by
Corporate Value, the 16th Tianma Award for Chinese Listed Companies in Investor Relationship
Management, and the “2025 Green and Low-Carbon Pioneer” issued by Sino-Securities Index. In
addition, the Company actively participated in the EcoVadis Assessment and won the “EcoVadis
Rapid Progress Medal for Sustainable Development”. It also passed ESG assessment accreditation
by its global key client Holcim, proving that its environmental, social and governance practices
comply with Holcim’s supplier code of conduct and international standards. This has further
enhanced the Company’s green competitiveness and customer recognition within the global supply
chain.
Besides these awards, the Company continued to make steady progress in core areas including
product R&D, market expansion, smart manufacturing and digital transformation, accordingly
building a multi-dimensional and coordinated innovation system. By deeply integrating technological
innovation with industrial upgrading, the Company expedited the commercial application of new
technologies and products. With coordinated development in domestic and overseas markets, the
National Service-oriented China Top 500 World-Class
Manufacturing Enterprise Machinery Enterprises Machinery Enterprise Company achieved new breakthroughs in business landscape. What’s more, with the overall
improvement of its capability in smart manufacturing and digital management, the Company has
injected new momentum into its operational and administrative efficiency, further consolidating its
leading position in the global industrial vehicle industry.
Companies in Credit Companies by Corporate Value Export
Holcim ESG Assessment 16th Tianma Award for Chinese 2025 Green & EcoVadis
Listed Companies in Investor
Certificate Relationship Management Low-carbon Pioneer Assessment
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Key ESG Performance 2025 Analysis of Issue Importance
Operating Revenue of RMB 17.74 billion, representing a Based on its line of business, the expectations of internal and external stakeholders, and
year-on-year increase of 5.90% other practical needs, Hangcha Group regularly identifies issues that affect the Company’s
creation of comprehensive economic, social and environmental values as well as
Net Profit Attributable to Parent of RMB 2.19 billion, representing a stakeholder evaluation on the Company. Through online questionnaires, management
meetings, expert reviews and other channels, the Company conducts due diligence and
year-on-year increase of 8.87% stakeholder engagement to identify, analyze sustainability issues, and conduct double
Economic importance analysis.
Performance Total Tax Payment of RMB 1.04 billion (approximate number),
representing a year-on-year increase of 35.13%
Analysis of Double Importance
The Company assesses important issues from two dimensions: financial importance and
impact importance. Issues with either financial or impact importance are defined as
Environmental training of 4,917 hours, with 119 person-times of important issues.
participants involved
Renewable energy installed capacity of 15.76MW; clean energy Issue Assessment Process Analysis Methodology
Environmental
consumption of 9.67 million kWh
Step 1 Learn
Performance Total afforestation area of 163,761.62 m 2
about the
By reviewing national policies and regulatory requirements, analyzing business
models, development strategies, daily operations, financial conditions, operating
background of results and market value, and referring to media reports and peer benchmark
corporate analysis, the Company identifies internal and external stakeholders, including
activities and governments and regulators, shareholders and investors, customers, employees,
business relations suppliers and partners, local communities and other parties.
Labor contract signing rate & social insurance coverage: 100%
Cumulative public welfare donations: RMB 2.21 million (approximate Step 2 Establish The Company formulates its issue list based on the 21 issues specified in the
number)
the issue list Self-Regulatory Guidelines for Listed Companies on the Shanghai Stock Exchange
No. 14 - Sustainable Development Report (For Trial Implementation).
Social 7,000 beneficiaries from poverty alleviation, rural revitalization,
Performance donation and public welfare projects
Impact importance assessment is used to evaluate sustainability information related to external
Step 3 Assess factors of corporate business. The process includes defining assessment factors, conducting
and confirm stakeholder research, setting judgment thresholds and making assessment conclusions.
issue Financial importance assessment identifies risks and opportunities that may affect business
operation, financial status, operating performance and cash flow, and evaluates their potential
financial impacts. The process includes defining assessment factors, conducting stakeholder
Step 4 Integrate
Governance 6 Audit Committee Meetings; results of impact The Company sums up assessment results of impact importance and financial
Performance importance to establish a double importance matrix.
Independent director ratio: 33,3 % and financial
importance
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Communication with Stakeholders Issue Importance Analysis Conclusions
The Company takes stakeholders’ key concerns as a core direction for sustainable The issues with dual importance identified by the Company include innovation-driven
development. It fully identifies stakeholder groups that may or have exerted significant product & service safety and quality. The matrix of issues with dual importance is shown as
impacts on business and operations, and continuously optimizes communication follows.
mechanisms to timely respond to expectations and demands, so as to create sustainable
value together.
List of Issues
Main Concerns Communication
Stakeholders Methods Responses
(Issue-related)
Low importance Importance to Economic, Social and Environmental Impact Very important
Environmental compliance management
● Shareholders' meeting
Improving corporate governance
Employees
●
● Information disclosure Periodic reports and
● Enhancing profitability
Continuous and stable ● announcements
and maintaining good dividends
Company website
business growth Pollutant emissions
●
●
● Strengthening risk control
● Future strategies ● Performance briefing sessions
● Improving the quality of
Corporate governance E-interaction, phone calls, emails
Waste disposal
●
Shareholders & Investors
●
information disclosure
● Risk management ● Strategy meetings
● Strengthening communication
●
Roadshows and reverse
roadshows
and exchanges with investors Social contribution Innovation-driven Development
Product quality control and
Data security and customer privacy protection Product & Service Safety and Quality
Customer satisfaction survey
●
●
Customer service and innovation
Communication with stakeholders
●
Handling of customer complaints
satisfaction ● Interaction on the Company
● Improve service process
Product quality and safety Customer communication and
Customers
●
website and social media
●
Anti-bribery and anti-corruption
●
relationship maintenance
● Improving the salary and welfare Anti-unfair competition
● Internal communication meetings system
● Legal employment Employee complaints and ● Focusing on physical and mental Energy utilization
● Training and development ● feedback health
● Employee welfare and security ● Internal and external training ● Improving the training and
Occupational health and safety Corporate culture dissemination
Employees promotion mechanism
● ●
Employee care activities ● Employee communication and
feedback Response to Climate Change
● Information disclosure Observing laws and regulations
Ecosystem and Biodiversity Protection
● Lawful operation ●
Daily communication and Paying taxes as per laws
Tax payment as per laws Water Resource Utilization
●
●
● reporting Providing job opportunities
● Business ethics ●
● Supervision and inspection Accepting supervision and
Provision of job opportunities
Government/Regulatory Agencies Circular Economy
●
●
Reception of visits inspection
Supply Chain Security
Rural Revitalization
● Honest operation ● Open and fair procurement
Project procurement
Technology Ethics
●
● Mutual benefits and win-win Good faith performance of
● Supplier contracts and agreements
● Supply chain management ● contracts
Supplier audit and evaluation
Equal Treatment of SMEs
●
Response to supply chain ● Supply chain management
● Supplier support and cooperation
risks Industry cooperation and
Suppliers and Partners ● Product quality and safety
Other supplier exchange activities
exchanges
Due Diligence
● R&D of new-energy forklift
● Energy use and management
● Disclosure of environmental data technologies and products
Green production and
● Regular release of ESG reports ● Product R&D
transportation
Importance to Corporate Finance
●
● Cultivation of users' low-carbon ● Compliance discharge of waste Very Important
Water resource management
Environment
●
awareness Ecological protection, energy
Emission management
conservation and emission reduction
● Helping with rural revitalization
● Launch of public welfare projects ● Supporting community public
● Community investment
● Community activities service
Volunteer activities
● Public welfare activities Organizing volunteer public
Community
● ●
welfare activities
● Press releases ● Investigation and visits
Transparency of information ● Exclusive media interviews
Discussion and exchanges
●
●
disclosure ● Press conferences ● Announcements and news
Interaction on the Company
Media Compliance operation ●
publicity
●
website and social media
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
ESG Governance
Arrangements
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
The Company’s ESG Governance
Arrangements
BOD’s Statement The BOD is the leading and decision-making body for ESG management
and information disclosure. It is responsible for deliberating and
The Board of Directors (BOD) attaches great importance to sustainable development. It promotes the approving the Company's ESG strategic planning, plans, and
sustainable development in a top-down manner from the perspectives of governance, strategy and implementation schemes, deliberating and approving the Company's ESG
management, continuously improves the sustainable development governance mechanism and governance structure and management system, deliberating and
management system, and thoroughly integrates the concept of sustainable development into all links of Decision-making approving the Company's ESG report, deliberating and approving the
business operation. Level information disclosure involving the Company’s major ESG information,
The BOD gives full play to its role in strategic deployment and decision-making guidance, gradually and deliberating the response plans for ESG-related risks and major
expands the scope of review and reporting on sustainable development issues, and further consolidates its negative ESG events that have a significant impact on the Company.
governance function in supervising sustainability risks and opportunities. The BOD clarifies strategic
goals, key tasks and management priorities for sustainable development, supervises and evaluates the
implementation effect of relevant strategies, and reviews risk management policies and sustainable
development information disclosure in line with sustainability requirements. Besides that, the BOD selects
experts in the ESG field and organizes professional training on sustainable development, so as to steadily
enhance the BOD’s performance capability, professionalism and diversity in sustainability governance. The Strategic Committee of the BOD serves as the research and guidance
The Company comprehensively promotes and deepens the construction of the sustainable development organ for ESG work. It is responsible for researching and making
management system. It defines overall sustainable development goals and formulates short-term, suggestions on the Company's ESG goals, strategic planning,
medium-term and long-term implementation plans covering disclosure preparation, management governance structure, and management system, identifying and
improvement and value realization. The Company assesses the importance of sustainability issues, monitoring ESG-related risks and opportunities that have a significant
advances the in-depth integration of sustainable development concept and institutional management, and impact on the Company's business, guiding the management team to take
Management
steadily improves the management efficiency of environmental issues (e.g., environmental compliance), appropriate response measures for ESG risks and opportunities, and
Level
social issues (e.g., innovation-driven development, product & service safety and quality, supply chain reviewing the Company's ESG-related reports and submitting them to the
security), as well as sustainable governance issues. During the reporting period, the BOD reviewed BOD.
proposals concerning the corporate ESG report, carbon peaking and carbon neutrality initiatives, internal
control evaluation, remuneration for directors and senior management, external donation arrangements,
information disclosure and investor relationship management.
The ESG Promotion Group is the coordination and execution organ for
Governance Structure ESG work. It consists of the ESG Leadership Group and the ESG Working
Group, which jointly promote the implementation of the Company's ESG
development strategic goals. The Company has established an internal
The Company continuously optimizes a well-connected sustainable development governance architecture. reporting mechanism for sustainable development information. The
The BOD undertakes overall strategic planning and decision-making governance, and has set up a reporting methods include special reports and progress statements, etc., and
Strategic Planning and Sustainability Committee under its jurisdiction. Under the committee there is a the reporting is made on an annual basis, ensuring that personnel at all levels
special sustainability working group headed by the BOD Secretary and committed to providing solid Execution Level of the governance structure have a timely access to relevant information. The
support for the BOD’s sustainability governance decisions. The Audit Committee of the BOD oversees the Company has established a sustainable development supervision
performance of the BOD and management in sustainable development work. The management team is mechanism, by which it discloses the information of relevant institutions and
responsible for the implementation of key sustainability issues, ensuring the efficient delivery of personnel in supervising and managing the formulation of sustainable
sustainable development decisions and objectives. development-related goals, the implementation of strategies, and the
progress of goal achievement, for example, internal control rules,
supervision procedures, supervision measures, and assessment results, etc.
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Governance Competence of the
Governing Body Capacity Improvement
The Company continuously enhances the professionalism of its governing body in sustainable development. Directors
participate in various professional training programs at regular intervals to keep abreast of national strategic directions,
Diversity economic trends and industrial evolution, so as to elevate the overall governance capacity of the BOD. In 2025, the
Company organized special training for directors, supervisors and senior management, focusing on the implementation
of policies. The training helped management personnel accurately understand the connection between new quality
The Company has formulated policies concerning BOD nomination and BOD diversity, specifying its productive forces and high-quality development, and improved their professional performance capabilities. Directors
position on BOD diversification and relevant ongoing measures. BOD diversity is regarded as a key factor also took online courses covering the revision of the Company Law, integrity development, corporate governance and
in achieving strategic objectives, maintaining competitive edges and advancing sustainable development. other sustainability-related issues.
When appointing BOD members, the Company takes full account of diversity in terms of talent,
professional skills, industrial experience, cultural and educational background, gender, age and other
dimensions.
Information Reporting, Supervision
Professionalism and Assessment Mechanisms
The BOD comprises professionals from various fields, including industrial specialists, international trade
experts, mechanical scholars, as well as talents in finance, economics, accounting, risk management,
corporate governance and sustainable development, which greatly strengthens the BOD’s decision-making
Information Reporting Mechanism
and strategic management capabilities. BOD members have extensive experience in ESG-related areas
such as innovation-driven development, product & service safety and quality, and supply chain security, so The Company has established an internal reporting system for sustainable
that they provide clear and professional guidance for the Company’s sustainable development. development information. The BOD reviews the progress of annual sustainable
development goals and strategy implementation, examines the Sustainability Report
at regular intervals, and hears reports on sustainability-related impacts, risks and
BOD Members Position Industrial Experience opportunities at irregular intervals.
Senior Economist. Mr. Zhao has long overseen the
Company’s overall strategy and operation. He leads the
Company to continuously strengthen the control of product
Mr. Zhao Limin Chairman & service safety and quality, optimize the supply chain
security management system, and advance the
Supervision Mechanism
implementation of sustainable development strategies and
the industry’s green transformation with his keen insight. A supervision system for sustainable development has been established, with clear
sustainability governance duties of the BOD and its special committees stipulated in
the Company’s Articles of Association. By reviewing or hearing documents and
By virtue of abundant experience in information technology reports on target setting, strategy implementation, target fulfillment, comprehensive
and intelligent management, Mr. Fang promotes the deep risk management, internal control, internal audit and sustainability disclosure, the
integration of digital technologies and industrial green BOD and its special committees supervise the overall progress of sustainable
Mr. Fang Xiang Vice Chairman development, empowers green finance through innovation, development work.
and offers professional decision-making support for the
Company’s environment-friendly and low-carbon
development driven by technology.
As the actual controller of the Company and a director of
multiple listed companies, Mr. Qiu boasts profound
experience in corporate operation and governance. In major
Assessment Mechanism
corporate decision-making process, he emphasizes the
Mr. Qiu Jianping Director overall assessment of environmental and social risks, The Company incorporates sustainable development indicators into the
continuously optimizes the corporate governance structure performance appraisal system for senior management. Remuneration is linked to
with far-sighted management vision, and promotes the performance results, in order to improve corporate governance, incentive and
integration of the ESG concept into the Company’s restraint mechanism, and give full play to the incentive and restraint role of
management system. remuneration in sustainable development.
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Environmental
issues
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Risk Type Specific Risk Risk Description Countermeasures
Environmental Issues Amid the backdrop of the implementation of "Carbon
Peaking" and "Carbon Neutrality" goals, the forklift industry
has to deal with technical requirements for "Electrification"
Increase R&D investment, develop low-carbon and environment-friendly
forklift products to meet the market demand for green logistics
equipment. Strengthen brand building and market promotion, publicize
Hangcha Group actively responds to the national "Dual Carbon" strategic goal and deeply integrates the Technical Risk
and "Low Carbon". As social attention to climate change
continues to increase, the market demand for low-carbon and
the Company's environmental protection philosophy and product
advantages, and improve the brand awareness and reputation. Exploit
concept of sustainable development into the entire chain of corporate operation. By planning the new-energy environment-friendly products keeps rising. If the Company emerging markets and seek new business growth points, such as
fails to keep up with the market trend on time, it may suffer a new-energy forklift leasing and after-sales services, as a way to adapt to
technology R&D, environment-friendly material application, and circular economy pattern in advance, the decline in market share and damage to brand value. market changes and trends.
Company has built a life-cycle emission reduction system covering product design, manufacturing, and energy
management. By adopting leading energy-saving processes and clean production technologies, the Company
Establish in-depth partnership with suppliers, and jointly formulate
continuously reduces the energy consumption per unit of output value and the carbon emission intensity, Extreme weather events and long-term climate change
supply chain strategies against climate change, such as establishing a
trends caused by climate change may affect the supply
raw material inventory alarm mechanism and preparing key raw
promotes the upgrading of the forklift and logistics equipment industry towards low carbon and intelligence, stability of key raw materials such as steel, rubber and
materials in advance. Expand the sources of raw material supply, reduce
electronic components. For example, under the influence of
and provides the industry with reproducible green transformation solutions. disasters such as rainstorm and flood, raw material
dependence on a single supplier and a single region. Optimize the
supply chain planning and choose region less subject to climate change
manufacturers might suspend production, and transportation
as raw material procurement site and production base. Conduct carbon
Transition Risks Market Risk routes are likely blocked, thereby affecting the Company's
raw material procurement and production plans. As global
emission assessment on suppliers, and prefer suppliers with low carbon
Response to Climate Change
emissions. Formulate carbon reduction plans together with suppliers,
attention to carbon emissions increases, the carbon emission
provide technical support and training to help them bring down carbon
level of suppliers may become a factor affecting the stability
emissions. Establish a supply chain carbon emission management
of the supply chain. If suppliers cannot meet carbon emission
system, monitor and report supply chain’s carbon emissions at regular
requirements, it may lead to supply interruption or confined
intervals, and ensure compliance with relevant policies®ulations and
cooperation.
the Company's sustainable development goals.
The Company attaches great importance to the issue of climate change. It actively responds to national
policies to cope with climate challenges. By formulating sustainable development strategies and promoting
the application of innovative technologies, the Company deals with climate impacts and opportunities in Evaluate the production facilities’ disaster-resistance ability, and
Extreme weather conditions such as flood, hurricane and
advance, keeps strengthening corporate resilience, and makes contributions to global efforts in addressing Extreme rainstorm may damage the Company's production facilities,
reinforce and transform key facilities to improve their ability to withstand
extreme weather. Establish an extreme weather alarm mechanism,
interrupt the supply chain, affect normal production and
climate change. Weather Events operation, increase operating costs and maintenance
adjust production plans and make emergency preparations in advance to
reduce disaster losses. Purchase relevant insurance for transfer of the
expenses, in turn affecting the Company's profits.
risk.
Physical Risks
Climate Risk Management Analyze climate change scenarios, evaluate the impact of long-term
climate change on the Company's business performance. Optimize
Long-term climate changes such as rising temperature and energy management, improve energy utilization efficiency, and reduce
Long-Term change of precipitation pattern may affect the Company's energy costs. Cooperate with suppliers to jointly address the raw
energy consumption, raw material supply and product
Climate Change performance, thus increasing operating costs and market
material supply risks brought by climate change and ensure the stable
supply of raw materials. Develop products that adapt to climate change
competition pressures. and improve the product performance and competitiveness under
different climate conditions.
In face of global climate challenges, Hangcha Group actively implements the "Dual Carbon" policy. In
process. Relying on the “Photovoltaic Power Generation Energy Saving Project”, we brought down
carbon emissions to a large extent. On the supply chain management side, we established a "Supplier
Evaluation System" and urged more than 300 core suppliers in the upstream and downstream to complete
Greenhouse Gas Emissions
green process transformation, with a view to jointly building a new green and low-carbon ecosystem.
Accounting standards and
Greenhouse Gas Scope (Unit: TCO2e) methodologies
Scope 1 Greenhouse Gas Emissions
The proportion of clean energy used in That drives more than 300 core suppliers
production has exceeded to complete green process transformation. Stationary source emissions In accordance with the
principles of ISO
core Mobile source emissions 14064-3:2019, an inde-
pendent third-party
verification was
Industrial process emissions conducted to assess
whether the greenhouse
Climate Risk Response Strategies Fugitive emissions gas statement from the
audited party complies
Scope 2 Greenhouse Gas Emissions with ISO 14064-1:2018.
Risk Type Specific Risk Risk Description Countermeasures
Total Greenhouse Gas Emissions
Amid the backdrop of the implementation of "Carbon Keep a close eye on the changes of domestic and overseas policies and
Peaking" and "Carbon Neutrality" goals, the government may regulations related to climate change, and adjust the Company's
enact more stringent carbon emission policies and energy strategies and production&operation plans in a timely manner. Take an
Policy and consumption standards to address climate change, which active part in industry associations and policy formulation, feed back the
Note: The data only covers the parent company of Hangcha Group. Data source: the Greenhouse Gas Verification Report of Hangcha Group Co., Ltd. (January - December 2025).
Transition Risks Regulatory Risk likely increases the Company's compliance costs and enterprise’s real needs and difficulties, and strive for favorable policy
support. Formulate internal carbon reduction goals and action plans,
operational pressure. In case of failure in making timely
adjustment, the Company may face legal risks and a decline reduce the carbon emission intensity on a gradual basis, and improve the
in market competitiveness. Company's environmental compliance and sustainable development
capabilities. According to the verification report, the Company’s total greenhouse gas emissions in 2025 decreased by
power for 2025 as green power environmental credits that are calculated as zero carbon emissions.
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Pollutant Emissions and Waste Disposal Waste Gas Management | Basic Introduction
The Company's waste gas emissions mainly come from particulate matter generated during the shot ball-blasting and
grinding process of the coating powder-spraying line, volatile organic compounds (VOCs), nitrogen oxides, sulfur
Wastewater Management | Basic Introduction dioxide generated during the powder curing process, and other pollutants generated during the paint-spraying process
in the paint line. The Company strictly follows national and local laws/regulations and relevant norms to ensure that
waste gas emission management complies with the procedures. For waste gas arising from newly-built, expansion, and
The Company's wastewater mainly comes from industrial wastewater and domestic sewage. Herein, Industrial reconstruction projects, the Company conducts environmental impact assessments (EIA) in accordance with the
wastewater includes pre-treatment and cleaning wastewater from the powder-spraying line, and cyclonic wastewater Procedure for the Management of New, Expanded and Reconstructed Infrastructure, in order to ensure legality and
from the paint-spraying booth, etc.; domestic sewage includes sewage generated from staff dormitories, canteens, mop compliance of waste gas emissions. As of the end of the reporting period, 100% of the Company's waste gas emissions
pools and shower rooms within the industrial park. The Company strictly observes the Procedure for the Management complied with national and local standards.
of Wastewater to monitor the treatment and compliant discharge of domestic sewage and industrial wastewater. The Company keeps improving the construction of waste gas treatment facilities, and installs treatment facilities in
strict accordance with the requirements of EIA. In the Company’s coating and painting workshop, multiple processes
Industrial wastewater is discharged into the industrial wastewater outlet pipeline of the park after being subjected to the
such as filter cotton, zeolite rotor adsorption and catalytic combustion are adopted for harmless treatment of waste gas.
treatment at the park sewage treatment station. Domestic sewage is settled through facilities such as septic tanks and In addition, the Company has also installed an online waste gas monitoring system to keep abreast of the emission
oil separators, then discharged into the Company’s pipeline network. status and ensure the waste gas emissions are transparent and under control. For particulate matter generated during
The Company actively optimizes the production process to reduce the output of industrial wastewater. For example, it the grinding process, it is discharged at a height of 15 meters after being subjected to dust removal by high-efficiency
extensively adopts powder-spraying tech in the coating process, so that paint-containing wastewater will not be film-coated bag. VOCs generated during the powder curing process are discharged at a height of 15 meters after being
produced. Besides, dry spray booth is used as the coating spray booth, which effectively reduces the amount of subjected to a four-unit combustion process. This effectively alleviates the impact on the environment, mirrors the
wastewater. Company's rigorous attitude and efficient implementation in waste gas management, and makes positive contributions
In 2025, the Company carried out emergency response work against abnormal wastewater discharge in accordance to environmental protection and sustainable development.
with the Procedure for Emergency Preparedness and Response. It controlled water quality data in real time through
online monitoring. During the reporting period, the Company’s compliance rate in wastewater discharge hit 100%,
Waste Gas Emission
exemplifying the Company's strict and effective management over wastewater, and ensuring the fulfillment of its With verified annual total Verified Annual Excessive
environmental protection responsibilities and commitments. Category UOM emission (Yes/No) Total Emission Emission
Industrial Wastewater Discharged Nitrogen Oxides Compliant, no
Tons Yes excessive
emission
With verified annual total Verified annual Excessive Compliant, no
Category UOM allowance (Yes/No) total allowance discharge Sulfur Dioxide Yes excessive
Tons
emission
Total wastewater No excessive Compliant, no
discharged Tons Yes discharge Particulate Matter (PM) Tons Yes excessive
emission
Chemical Oxygen No excessive Volatile Organic Com- Compliant, no
Tons Yes discharge Tons Yes excessive
Demand (COD) pounds (VOC) emission
No excessive
Ammonia Nitrogen Tons Yes discharge
Note: The 2025 waste gas data only covers the parent company of Hangcha Group.
Total Phosphorusa Tons No
Note: The 2025 industrial wastewater data only covers the parent company of Hangcha Group.
Solid Waste Management | Basic Introduction
In strict accordance with relevant laws and regulations such as the Law of the People's Republic of China on the
Prevention and Control of Environmental Pollution by Solid Wastes, the Company has established a responsibility
system for the prevention and control of environmental pollution by general industrial solid wastes, domestic
garbage and hazardous wastes. In the whole process of the generation, collection, storage, utilization and disposal
of industrial solid wastes, the Company has adopted a series of measures to effectively prevent solid wastes from
polluting the environment. General industrial solid wastes and domestic garbage are classified and recycled by the
source departments, and then transported by qualified agencies to compliant garbage treatment plants. For
hazardous wastes, the Company entrusts qualified enterprises to handle them, and inspects the disposal sites at
regular intervals to ensure the standardization and safety of the treatment process. As of the end of the reporting
period, the Company did not suffer any environmental pollution or safety accidents caused by improper waste
disposal.
In addition, the Company is committed to controlling emissions at the source. By adopting clean production
processes (such as dry cutting), renewable resource processes (such as activated carbon regeneration), and
environment-friendly and low-risk coating processes (such as change from paint line to powder-spraying line), the
Company actively fulfills its environmental protection responsibilities, promotes green operation, and does its bit for
sustainable development.
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Ecosystem and Biodiversity
Solid Waste Emission
With verified annual total Verified Annual Excessive
Conservation
Category UOM emission (Yes/No) Total Emission Emission
Hangcha Group has always incorporated biodiversity conservation into the core of its corporate sustainability
Hazardous Waste Tons No strategy because the Group has a deep understanding of the symbiotic relationship between industrial
manufacturing and natural ecosystems, thus it strictly abides by the ecological environment zoning control system.
As of the end of the reporting period, no incidents damaging biodiversity have occurred in the Company.
General Waste Tons No
Note: The 2025 hazardous waste data only covers the parent company of Hangcha Group, and the general waste data only includes the disposal data of (solid waste generated from
other industrial production processes) in the park. Environmental Compliance
Management
Emission Reduction Environmental Management System
Based on the framework of ISO14001:2015 standard, the Company
has established a complete institutional matrix covering the
Air Pollutants (including Nitrogen Oxides, Volatile Organic Procedure for the Management of Environmental Factors, the
Compounds (VOCs)) Procedure for the Management of Sewage, the Procedure for the
Pollutant Type / Name Management of Exhaust Gas and Dust, the Procedure for the
Management of Noise, and the Procedure for the Management of
Focusing on green manufacturing and low-carbon development, the Company Solid Waste. Driven by both institutional integration and
continuously deepens the whole-process comprehensive treatment of VOCs. technological innovation, the Company achieves the in-depth
Remarkable VOC emission reduction results have been achieved through multiple coupling between environmental management requirements and
measures including adopting raw & auxiliary materials with low VOC content at the business processes. By the end of the reporting period, the Company
Emission Reduction source, optimizing production processes and closed collection, and improving the had completed the system certification of the headquarters and 10
Measures Adopted During operational efficiency of terminal treatment facilities. All treatment measures are stable controlled subsidiaries, and established a standardized and
the Reporting Period and effective with waste gas discharging steadily up to standard. The generation and reproducible environmental management paradigm, ensuring that
emission of VOCs are reduced at the source, environmental quality is continuously the environmental protection concept runs through the life cycle of
improved, corporate ESG environmental performance is effectively enhanced, providing products.
solid support for green, low-carbon and high-quality development. As the primary person responsible for the Company's environmental
protection work, the chairman of the Company leads the formulation
In 2025, the Company newly installed RCO catalytic combustion devices, greatly of the Company's environmental protection guidelines, policies, and
improving VOC treatment capacity. The annual VOC emission was 4,526 kg,
Progress Achieved During strategies, and makes a variety of decisions on environmental
corresponding to an output of 197,634 units. The VOC emission intensity per unit of protection work according to the corporate governance process. So
the Reporting Period product dropped to 0.023 kg/unit, implying a significant decrease compared with the far, the Company has established a three-level management system
level before treatment, achieving the dual control over total emissions and intensity. (namely, "Strategic Level - Executive Level - Operational Level”) for
its environmental protection work. The Development Department is
responsible for coordinating daily environmental protection affairs,
and it has established a cross-departmental coordination mechanism
with core departments such as Technology R&D Dept., Production
and Operation Dept., and Quality Control Dept. By establishing a
system that links the environmental protection target responsibility
with the performance appraisal, the Company ensures that the
environmental protection strategy is assigned to each business unit,
achieving closed-loop management.
Annual VOC Emission: Corresponding Output:
kg Units
VOC Emission Intensity per Unit of Product Dropped to
kg/Unit
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Three-Level Management System for Environmental Protection
Energy Utilization
Strategic The chairman of the Company is responsible for centralized coordination and
all-around management of the Company's environmental protection work, leads the
Level formulation of the Company's environmental protection guidelines, policies and Energy Management
strategies, and ensures the overall effectiveness of environmental protection work.
The Company has established an energy management system involving management documents such as
The Development Department of the Company, as the coordinating department for the the Procedure for the Management of Energy, the Power Consumption Management Rules, and the
Company's environmental protection management work, actively publicizes, implements Procedure for the Management of Oil and Hazardous Chemicals, aiming to conform to the realities of the
Executive
Establishing
and carries out the state’s environmental protection guidelines, policies, laws and Energy Company and push ahead with the Company’s sustainable development. Under this system, the Company
Management
has specifically set up an energy management institution led by the equipment department, which is
Level regulations as well as the relevant environmental management requirements of the
Group. It coordinates and supervises the implementation and execution of environmental
System
responsible for the comprehensive and efficient utilization of multiple energy resources such as electricity,
protection work by the relevant departments and subsidiaries. natural gas, gasoline and diesel in the industrial park.
Functional departments responsible for carrying out the Company's environmental
In the real operation, the Company clarifies the tasks and responsibilities of each department and branch
Operational protection work take charge of the specific implementation of environmental factory in energy management to ensure that there are specially-assigned persons in charge of each link,
protection work, and timely convey the spirit of relevant national documents on Clarifying
Level environmental protection and the specific requirements of the Company to
Responsibilities
and Enhancing
Awareness
which achieves the institutionalization and standardization of energy management. In addition, the
Company organizes training and publicity activities at regular intervals to enhance employees' energy
employees. awareness. It encourages employees to actively participate in energy conservation and emission
reduction actions, and to integrate the energy-saving concept into daily work.
The Company has formulated the Rules for the Assessment of Park Environmental Management to implement a dual-track
verification mechanism of "Internal Audit + External Certification" and conduct evaluations on the achievement of
environmental management objectives at regular intervals. In light of the Rules, the Company focuses on verifying key
indicators such as the compliance of environmental impact assessment procedures for new projects, the compliance of the
implementation of pollutant discharge permits, the compliance rate of the discharge of "Three Wastes" (waste gas, waste water During the reporting period, the Company kept promoting the optimization and upgrading of infrastructure
and solid waste) in monitoring, and the effectiveness of environmental protection facilities. By establishing a digital monitoring in accordance with the Procedure for the Management of New, Expanded and Reconstructed
platform and connecting it with the local government's supervision system, the Company achieves real-time dynamic Optimizing Infrastructure. For new projects, attention was given to energy efficiency design; for existing facilities,
Infrastructure
monitoring of data and early warning of abnormalities, ensuring that the environmental performance complies with national, technological transformation was advocated. By taking the aforesaid actions, the Company dedicates
industrial and local standards. itself to reducing energy consumption, improving energy utilization efficiency, and complying with higher
During the reporting period, the Company and all controlled enterprises maintained a record of zero environmental pollution environmental protection standards. This lays a solid foundation for its sustainable development.
penalty.
Green Operation
Energy Consumption Statistics
While promoting the improvement of environmental management
capabilities, the Company attaches great importance to the organization and
implementation of environmental protection training. With a view to
enhancing employees’ awareness on environmental protection and guiding
them to actively take environmental protection actions in work and life, the Disclosure Item UOM Specific Data Parameter Source / Basis
Company does its bit for creation of a green and sustainable future.
As of the end of the reporting period, the Company organized environmental
Basic Information on
training with a total duration of 119 hours, and the number of employees in
the training totaled 4,918 person-times. Energy Utilization
In December 2025, the Development Department integrated the Direct Energy Ton of Standard
environmental protection skills competition into the Company's skills
competition platform. By means of theoretical examination and practical
Consumption Coal
skills competition, the Development Department further enhanced
Details of the Company's
Indirect Energy Ton of Standard Energy Purchase,
employees' understanding and application ability of environmental
protection knowledge. Such measure not only diversifies employees' Consumption Coal Consumption and Inventory
learning forms but also improves the team's practice level in environmental Total Energy Ton of Standard
protection, laying a solid manpower foundation for the Company's green
development. Consumption Coal
Comprehensive Energy
Ton of Standard Coal per Comprehensive Energy
Output Unit (Ton of
Consumption per Unit of Revenue /
Standard Coal / Ten Consumption of Industrial
Product / Output Value
Thousand Yuan) Output Value
Total Duration of Environmental Training by the Company:
Cumulative Number of Participants in Environmental Training: coal, accounting for 11.43% of the total energy consumption.
Environmental Protection Skill Competition
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Water Resource Conservation Goals, Specific Measures
Energy Saving Measures
and Water Resource Recycling & Utilization
Measures Adopted in the
Measure Type Key Effect Indicators The Company actively takes various measures to promote water
Reporting Period
resource conservation. On the one hand, by posting water-saving
Give priority to the procurement of key
slogans and organizing water-saving publicity activities, the
Two sets of newly installed 55kW air compressors with Compared
power equipment such as high-efficiency Company creates a water-saving atmosphere, in which it guides Hengfan Phase IV Project
national first-class energy efficiency adopt high-efficiency with
employees to cultivate water-saving awareness and stimulates
motors, frequency converter-driven air motors and optimized pneumatic system design, with traditional air
employees' enthusiasm for active water conservation. On the other
Newly Built a
compressors, water pumps and fans that significantly improved energy efficiency compared with compressors,
Energy-Saving comply with national energy efficiency hand, during the inspection process, the safety officers of each
traditional air compressors. After the project is put into the annual
Production grade standards (e.g. GB18613); select operation, the compressed air system operates stably with electricity
department and the Security Department will timely report problems
equipment with advanced energy-saving such as abnormal water meters to the Equipment Department in m? Rainwater
Equipment reduced energy consumption, effectively bringing down saving is
Collection Tank
technologies (e.g. permanent magnet power consumption in the production process and estimated at order that measures can be taken swiftly to resolve the problems
synchronous, IE4/IE5 super high efficiency supporting energy conservation and carbon reduction on about 80,000 and reduce water waste.
grade) for new projects or equipment the production side. kWh For water resource recycling and utilization, the Company actively The Group's Total Rainwater
upgrading. promotes rainwater collection and utilization project. During the Collection Volume Reached
reporting period, the Hengfan Phase IV Project newly built 193.28
cubic meters of rainwater collection tanks, and the total volume of
A comprehensive energy-saving renovation was carried
out on the lighting system of factory workshops, with
rainwater collected by the Group reached 1,005.84 cubic meters. The m?
collected rainwater is used for afforestation and irrigation, which
Completely phase out incandescent effectively reduced the demand for tap water, promoted the
traditional lamps replaced with LED lamps, and 5,000 sets Annual
lamps and fluorescent lamps;
of LED lamps installed in offices, implying 10,900 sets of
sustainable utilization of resources, and achieved a win-win in
Energy-Saving promote LED lamps in factory areas,
electricity
economic and environmental benefits.
lamps were renovated in total. As a result, the power of saving
Lighting office buildings, workshops and
each lamp is reduced by 50%, meaning that on the premise estimated at
warehouses; apply light-sensitive /
Equipment
voice-controlled / timing / zoned
intelligent control systems.
of ensuring the illumination meets production and office
requirements, the energy consumption of the lighting
system is greatly reduced, and the greening and
energy-saving level of the factory area are significantly
about 3.717
million kWh
Circular Economy
improved.
Roof-mounted Distributed Solar PV Power Station
Lin'an Park completed the commissioning of 342 sets of
The Company actively promotes the application of renewable energy. It has built distributed solar photovoltaic power
air conditioners with first-class energy efficiency
Adopt high-efficiency air conditioners stations on the roofs of factory buildings in the park, in order to adopt solar photovoltaic power generation. During the
(including multi-split, wall-mounted and cabinet units), Annual
Energy-Saving such as magnetic suspension water
with a total installed power of 2,400kW. All equipment electricity
reporting period, the Company’s installed capacity of renewable energy facilities totaled 15.76MW, an increase of
chillers and variable frequency 59.19% from 2024. Its total power generation in 2025 reached 12.9399 million kWh, effectively reducing the Company's
Temperature multi-split units; apply high-efficiency
meets the national first-class energy efficiency standard saving
with higher cooling & heating efficiency and lower energy dependence on traditional electric energy, bringing down carbon emissions, and promoting the optimization of the
Control heat pumps in heating and ventilation estimated at
Company's energy structure.
consumption, realizing efficient and low-carbon operation about
Equipment systems; install intelligent temperature
of air conditioning systems in office and auxiliary areas 300,000 kWh
control systems for key equipment.
and further reducing the overall power consumption of the
park. Rooftop PV
Water Resource Utilization
Overview of Water Resource Utilization
The Company attaches great importance to water resource management and regards it as a key link in operation. By
strictly implementing measures such as the Water Consumption Management Rules, the Company dedicates itself to
improving the efficiency of water resource utilization and achieving the rational utilization and sustainable development
of water resources.
Category UOM
Total Water Resource Consumption Tons
Water Resource Consumption Intensity Tons/Unit
Note: The 2025 water resource data only covers the parent company of Hangcha Group.
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Afforestation Projects and Carbon Absorption Supplier Packaging-Free Distribution Practice
During the reporting period, the newly-added afforestation
area of the Company reached 4,403.72 square meters, and the
total afforestation area of the Group was as high as Packaging Replacement Parts Unpacking Plastic Reduction at the
carbon dioxide emitted by the Company and improve the
ecological environment quality of the park. The Company
To thoroughly practice the concept
sponsored afforestation maintenance to ensure the
of circular economy and green
continuity and effectiveness of afforestation projects.
low-carbon development, the Through supplier packaging-free
Company vigorously promotes the distribution practice, the Company
The Company’s Newly Added reform of supplier packaging-free effectively reduces the generation of
For parts such as air filters, mufflers disposable packaging waste and
Afforestation Area: distribution. It replaces traditional
and exhaust pipes, the Company
disposable cartons with recyclable drives the supply chain to upgrade
fully implements a special tooling towards greening, light weight and
plastic turnover boxes and special
distribution plan to realize zero recycling. While reducing operating
tooling appliances, which brings
m2 down packaging material
unpacking time, greatly reduce costs and improving production
ineffective operations, optimize efficiency, the Company
consumption at the source, reduces
The Group’s Total Afforestation on-site operation processes and continuously shores up ESG
logistics costs and improves online
Area: significantly improve overall environmental performance and
distribution efficiency, achieves the
production & operation efficiency. embarks on a green logistics
triple value of cost reduction,
efficiency improvement and carbon development path that balances
m2 reduction, and injects strong economic and ecological benefits.
Ecological Environment of the Park momentum into corporate ESG
sustainable development.
Regeneration and Recycling of Hazardous Waste Activated Carbon
To ensure the disposal compliance and regeneration During the reporting period, the Company completed a
Paint Sludge Hazardous Waste Reduction Practice
professionalism of waste activated carbon, the total of 113.9t hazardous waste activated carbon
Company strictly selects and entrusts third-party regeneration by entrusting professional third-party
institutions with hazardous waste disposal disposal. Supported by the technical strength of the Hangcha Group’s subsidiary Axle & Gearbox Company focuses on the difficulties of hazardous waste management
qualifications and mature activation and regeneration Activated Carbon Sustainable Laboratory of Xingyu in the coating process, and implements a plate filter press reduction disposal process for paint sludge waste
technologies to promote the whole-process recovery Carbon S&T Co., Ltd., this model achieves efficient generated in spray booths, removing free moisture inside paint sludge deeply through professional filter press
and regeneration processing of waste activated carbon. recycling: each ton of regenerated activated carbon equipment and accurately optimizing the material form of paint sludge. Through process optimization and actual
Relying on the technical reserves, disposal equipment drives 3 tons of resource recycling and reuse, with each measurement prediction, the moisture content of paint sludge can be reduced from 90% under traditional extensive
and compliant operation system of the third-party ton of regenerated carbon helping reduce 3.66 tons of disposal to 60% or below, greatly lowering the moisture content and outward transportation workload of paint sludge
professional team, the Company has built a complete CO2 equivalent emissions. The Company's total carbon
hazardous waste, completely changing the traditional extensive mode of direct external transportation and disposal
closed loop of “Waste carbon recovery - professional reduction reached 416.874 (113.9×3.66) tons of CO2e,
of paint sludge, and realizing "Source Reduction, Efficient Management" of hazardous waste.
regeneration - qualified reuse”, thoroughly getting rid approximately 417 tons of carbon dioxide equivalent.
of the traditional mode “One-time Use, Incineration &
With the significant drop in moisture content, the outward transportation workload of paint sludge hazardous waste
Landfill" and realizing life-cycle management over is greatly reduced, which not only effectively downsizes the land occupation for hazardous waste storage, reduces
hazardous waste activated carbon. the outward transportation and disposal costs and environmental transportation risks of hazardous waste, but also
lowers energy consumption and carbon emissions in the terminal disposal process of hazardous waste, further
extending the Company's circular economy chain, achieving multiple benefits of hazardous waste reduction, cost
control and green prevention & control, and effectively fulfilling corporate environmental responsibilities.
Through this activated carbon regeneration and recycling model, the Company effectively eliminates a large number of virgin carbon
production and waste carbon incineration disposal links, significantly improving resource utilization efficiency, and providing solid
support for the development of corporate circular economy and the achievement of the "dual carbon" goals. Circular Reuse Renovation of Frame Transport Pallets
Hangcha Group’s subsidiary Sheet Metal and Welding Company vigorously promotes recyclable and reusable
packaging carriers, focuses on implementing special carbon reduction practices in the logistics link of core
Emission Reduction Measures for Vehicles in Service materials, eliminates traditional disposable wooden pallets for frame transportation scenarios, customizes special
metal circular pallets for internal repeated use, completely puts an end to the one-time consumption mode, and
The Company actively promotes green logistics. During the reporting period, the Company adopted new energy practices the concept of circular economy. Relying on this renovation measure, nearly 20,000 disposable wooden
forklift as in-plant transportation vehicles, with coverage ratio hitting 100%. For out-of-plant transportation vehicles, pallets can be saved every year, which not only greatly cuts consumable costs and resource consumption, but also
new-energy electric vehicle. The Company set up environmental protection monitoring equipment in the dedicated green low-carbon development in the logistics link.
logistics passages to collect data of transportation vehicles in real time, which effectively enhanced the
transportation enterprises’ awareness on environmental protection, promoted the development of green logistics,
reduced pollutant emissions during the transportation process, and improved the overall environmental protection
level in transportation.
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Social Issues
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Social Responsibility Poverty Alleviation
by Education
While making profits and fulfilling legal responsibilities to shareholders and employees, the Company, with a Every year, the Company carried out pairing assistance and welfare visit activities with co-construction
sense of mission and responsibility, takes the initiative to assume responsibilities to consumers, communities units such as Sinopec Zhejiang Lubricant Branch, extending care to student He Yun in Yuqian Town,
and the environment. It does not take profit as the only goal, but gives more attention to humanistic care in the Lin'an District.
production process and the improvement of human value. Besides, the Company continuously practices
corporate social responsibility, dedicates itself to promoting the improvement of employee value, boosting
environmental protection and enhancing social welfare, and does its bit for sustainable development.
In 2025, the Company actively fulfilled social responsibilities with a total donation of 2.20583 million yuan in Public Welfare
social public welfare. Details of social responsibility work are as follows: Assistance
In response to the “Ten Thousand Enterprises Help Revitalize Ten Thousand Villages” campaign, the
Company deepened the counterpart support from Lin'an to Baiyu, and helped rural revitalization through
Poverty Alleviation and Rural the Living Environment Improvement Project. It is worth pointing out that the Company’s continuous
Quantity / Content Description investment in social responsibility has gained social recognition, so that it has been rated as one of the
Revitalization Project
"Top 100 Leading Private Enterprises of Zhejiang in Fulfillment of Social Responsibilities" for two
consecutive years.
Total Investment (Ten Thousand Yuan)
Including: Funds (Ten Thousand Yuan) Pairing Assistance
In 2025
Purchasing Agricultural Products for
Material Value Conversion (Ten Thousand Yuan) The Company actively responds to the call of the Hangzhou Municipal Government and is one of the
Poverty Alleviation
first organizations to become a member of the Hangzhou Assistance Group. From "49100" to "Pairing
with Townships", the Company has paired with and assisted "Zuokou Township" and "Zitong
Beneficiary Population (Person) Township" of Chun'an County and Tianmushan Township of Lin'an District in succession since 2000.
Thanks to nearly 20 years of efforts, the Company has provided assistance funds and materials worth
more than RMB 16 million.
In 2025, relying on the "Tianmu Common Prosperity Alliance" platform, the Company further deepened
the co-construction mechanism of "Alliance and Industry". Meanwhile, the Company expanded the
breadth of enterprise-village cooperation through alliance co-construction, strengthened
organizational leadership through co-construction, and drove industrial development through talent
support. As a corporate representative of the “Tianmu Common Prosperity Alliance” in Lin'an District,
Rural Revitalization Hangcha Group actively fulfills corporate social responsibility, contributes to the common prosperity
of Guifangqiao Village in Lin'an District, and supports the implementation of the rural revitalization
strategy.
Overview of the Company's Major Achievements in Poverty Alleviation and Rural Revitalization Assistance:
Poverty Alleviation
by Industry
The Company further implemented the mechanism of pairing with townships, focused on supporting
Social Contribution
Zitong Township of Chun'an County, pushed ahead with the collective economic income increase project
in Fushi Village, established a dual-drive mode of "Eliminating Weaknesses, Increasing income + Art
Industry", and boosted rural sustainable development through industrial driving. In 2025, the Company continued to make efforts in
social responsibility and sustainable development.
By virtue of its outstanding practices in
environmental governance and green low-carbon
Poverty Alleviation transformation, the Company was successfully
by Employment selected into the Sino-Securities Index "2025
Green and Low-Carbon Vanguard" list, with fewer
than 30 enterprises nationwide winning this honor,
The Company capitalized on the "Tianmu Common Prosperity Alliance" co-construction mechanism to
fully demonstrating Hangcha Group's leading
drive the development of rural industries in Guifangqiao Village of Lin'an District, etc. As a result, the
position in the field of sustainable development. In
Company created more than 200 job opportunities, and promoted farmers' income growth and prosperity
addition, Hangcha Group won the “Top 100
through industrial development.
Excellent Debut ESG Reports of A-share Listed
Companies 2025” of Sino-Securities Index.
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
In the process of fulfilling social responsibilities, the Company attaches great importance to the integration
of product safety and social value.
In June 2025, the Company was invited to the main venue event of the 2025 National Special Equipment
Safety Day hosted by the State Administration for Market Regulation, with the theme of "Safeguarding
Special Equipment Safety, Sharing a Better Life Together". The Company provided 3 new energy products R&D and Innovation Intellectual Property Standardization Governance
(including high-voltage lithium-ion forklifts and hydrogen fuel cell forklifts) as demonstration vehicles for Governance Framework Governance System Layout
forklift skill displays, and organized a team for on-site demonstrations, fully showcasing Hangcha Group's
strong sense of responsibility and mission as an industry leader in the cause of special equipment safety. In line with the industrial vehicle industry’s The Company sets great store by the role of The Company has built an industry-leading
transformation and upgrading toward greening, intellectual property in corporate development, corporate standard system with unique
In October, the Company globally debuted the X1 series humanoid logistics robot at CeMAT ASIA 2025, intelligence and high-end development, the and has formulated intellectual property-related characteristics in the industrial vehicle industry,
marking the completion of its strategic upgrading from a traditional industrial vehicle manufacturer to a Company practices the philosophy of "Aiming at management rules fit for the Company. It driving the enterprise’s innovative development
Benchmark, Surpassing Competitors, empowers innovative development through the powered by standardization construction.
full-scenario intelligent logistics solution provider. During the exhibition, the "Agent · New Ecosystem" Developing the Best Forklift”, and builds an following measures: 1) Deep integration: deeply Technical experts with years of industry
Hangcha Group Embodied Intelligence Industrial Technology Innovation Forum was also held. Experts and efficient technological innovation system integrate the intellectual property strategy into experience serve as Vice Chairman of National
featuring “One Core, Two Wings and Overall the technological development plan and Technical Committee for Industrial Vehicles
scholars from Zhejiang University, MANYCORE Technology and other institutions, together with the Coordination”. formulate corporate standards such as the Standardization (TC332), standardization expert
Company’s representatives, had in-depth exchanges on the “Industrialization Path of Embodied Specification for Declaration of Sci-tech of China Construction Machinery Association,
Achievements; 2) Innovation incentive and registered expert of ISO/TC110,
Intelligence”. mechanism: formulate the corporate standard demonstrating the Company's profound
Measures for Rewarding Sci-tech Achievements to foundation and extensive influence in the field of
push ahead with R&D; 3) Value transformation: industrial standardization.
rely on the patent pre-examination mechanism to
Governance Hierarchy expedite the confirmation of innovation
In terms of the construction of the ESG governance system, the Company formulated achievements, build core technological barriers,
and provide strong support for the
and issued the Sustainable Development (ESG) Management Rules in April 2025, Leadership and commercialization of products.
established an ESG management system under the leadership of the Board of Decisions by the
Directors, clarified the responsibilities of the Board of Directors, Strategic Committee, BOD
ESG Working Group and all executing units, providing institutional support for the
Research and
systematic advancement of ESG work. The Company continuously optimizes its
Guidance by the
global network planning and expedites the implementation of the "Localized
Production + Globalized Market + Localized Services" strategy. For example, the
Strategic Strategy
Committee
Company’s Thailand production base started construction, while its European leasing Aside from dedicating itself to the mission of "Making Handling Easier", Hangcha Group persists in its
company, Vietnam subsidiary, Malaysia subsidiary, Indonesia subsidiary, US Coordination and development strategy of “Specialized Production, Brand-oriented Operation, Group-based Management,
intelligent logistics company and other branches commenced operation one after Execution by the International Integration”. The Company focuses on six core business segments namely new energy vehicles,
another. So far, the Company has established 20-odd overseas subsidiaries, forming ESG Working smart logistics, aftermarket services, construction machinery, core components and cleaning equipment.
a global landscape for marketing, R&D, manufacturing and leasing. Group Upholding the corporate spirit of “Enterprising, Pragmatic, Innovative, Harmonious”, Hangcha creates value,
gives back to society, and strives to fulfill its vision of “Becoming the World’s Strongest Forklift Enterprise”.
Over the years, Hangcha Group has always upheld the core values of "Integrity as Foundation, Benefit First,
Sustainable Development, Repaying Society", actively improved the working environment, fulfilled social
Green Development
responsibilities and optimized the governance system. The Company integrates social responsibility
elements into its daily management and operation, striving to achieve harmonious and win-win
development among the enterprise, the employees, society, and the environment. It seamlessly combines The Company firmly implements the "New Energy Strategy" and builds a vertically integrated system of "Independent R&D and Manufacturing
its own development with social development and fulfills the social responsibilities of a listed company with of Core Components + Full-series Product Matrix + Global Supply Chain Collaboration". Centering on new energy technologies such as
a win-win philosophy. batteries, electric drives and electronic control systems, the Company independently develops three vehicle platforms: battery, hydrogen fuel
cell and hybrid power. It has established the most comprehensive new energy product system in the industry, with all product lines powered by
Next, Hangcha Group will take new steps in further fulfilling the concept of social responsibility, make new
new energy, for example, the Company replaced lead-acid batteries with low-voltage lithium batteries, and its high-voltage lithium batteries
contributions to serving the high-quality development of Zhejiang, present a new look in fostering a social outperformed internal combustion engines. In addition, the Company was the first to launch multiple products including the 48-ton high-voltage
responsibility brand, and achieve new breakthroughs in enhancing corporate ESG governance capacity. It lithium-ion forklift, 45-ton high-voltage lithium-ion container reach stacker, 48-ton hydrogen fuel cell forklift and high-voltage lithium-ion rough
will continue to focus on the strategic directions of green development, intelligence and internationalization, terrain forklift. Moreover, the Company took the lead in launching new flagship energy products such as dedicated lithium-ion forklifts, dedicated
lithium-ion reach forklifts and high-voltage
quicken the pace to move toward the goal of ranking among the “World's Top Five Forklift Manufacturers”, lithium-ion rough terrain forklifts. It
and do its bit for social sustainable development. continuously strengthens the development
of new products and launches them onto the
market, providing diverse "Hangcha
Solutions" for customers to reduce carbon
emissions. A joint venture was established
Innovation-driven Development
with France's Manitou Group in order to
focus on the high-end European lithium
battery market and achieve the leap from
"product export" to "technology and capital
export". In-depth strategic cooperation was
Governance reached with EVE Energy to promote the
integrated development of advanced battery
technologies and intelligent equipment. With
The Company has established a governance structure and internal institutional system adapting to a complete new energy product portfolio as
innovation-driven sustainable development. Through the continuous optimization of technological innovation well as leading technology and
performance, the Company maintains a top
platform planning, R&D and innovation incentive mechanisms, standardization system and intellectual
market share in the industry, leading the
property management rules, the Company has achieved all-around management and supervision over the industry into the all-electric era through full
impacts, risks and opportunities related to innovative development. industrial chain integration.
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
With years of intensive development in the hydrogen energy sector and by virtue of three core advantages ( namely Intelligent Development
technological R&D, industrial chain collaboration and commercial practice), the Company has become a benchmark
enterprise in China's hydrogen energy industrial vehicle sector. It took the lead in launching new products including
solid-state hydrogen storage forklifts, dual hydrogen tank forklifts, dedicated fuel cell forklifts, fuel cell reach stackers, Seizing the opportunity of industrial intelligent transformation, the Company builds a full-scenario intelligent
hydrogen energy tractors and hydrogen energy reach forklifts. Together with BMW Brilliance, the Company completed the logistics ecosystem centering on "Hardware + Software + Integration". So far, it has established an industrial pattern
closed-loop verification over the entire hydrogen energy industrial chain of "Production, Storage, Transportation and of coordinated development among four business clusters: Hangcha GUOZI Intelligence, Hangcha OKAMURA
Application" at the Tiexi Plant, creating a reproducible zero-carbon logistics model with industrial demonstration Intelligence, Hanhe Intelligence and GUOZI Robotics. The Company strives to create a full-category hardware matrix
significance. In addition, the Company reached a cooperation with JUST POWER for 108 units of 3.5t hydrogen energy of "Unmanned Industrial Vehicles + Logistics Robots + Humanoid Robots" and provide intelligent logistics
forklifts, setting a record for the largest single delivery of hydrogen energy forklifts in China, and the products were solutions covering AGV/AMR products, vertical storage and software integration systems, delivering full-cycle
successfully delivered in November 2025. At present, more than 400 fuel cell forklifts are running in nearly 30 cities across services from planning and design, product R&D to project implementation. The Company keeps consolidating its
China, serving clients such as Yanshan Petrochemical, SINOPEC Hainan Petrochemical, Guangzhou Petrochemical, Ningbo leading position in traditional advantageous industries such as food and rubber, and actively expands emerging
Zhoushan Port and Foshan Lighting (FSL), and have been reported many times by CCTV and other media. The cumulative fields including beverages, home textiles, lithium batteries and auto parts. Supported by top-tier client resources,
running hours of the Company’s fuel cell forklifts have exceeded 200,000 hours. With the successive mass delivery and the Company gradually extends to upstream and downstream industrial chains and peripheral markets, with line of
application of products, Hangcha Group’s hydrogen energy forklift line has achieved a crucial leap from "Pilot Application" business covering more than 20 industries such as PV, 3C electronics and pharmaceuticals. The Company has
to "Massive Replication". As a result, the Company has won many industry awards such as the GG Golden Globe Award, independently developed a millimeter-level navigation accuracy system combined with marker-less laser navigation
TrendBank Future Award and Chinaforklift.com Jinli Award, and participated in multiple national and provincial key projects. technology, enabling precise operation in complex scenarios. The "Zhongce Future Factory" project undertaken by
the Company was selected as a benchmark case in China's mobile robot industry, setting an example for the
industrial intelligent transformation.
During the Reporting Period Cooperated with JUST Over 400 fuel cell forklifts deployed
POWER for in nearly
units of t hydrogen cities nationwide
energy forklifts
Cumulative running hours of fuel
cell forklifts exceeding
hours
The proprietary X1-series intelligent logistics humanoid robot was grandly
launched at CeMAT Shanghai in later October
Partial Product Display
With a keen insight into development opportunities of future industrial ecosystems such as industrial internet and
embodied intelligence, the Company, relying on its profound technological practices in the industrial vehicle
industry and continuous investment in cutting-edge technologies (e.g., AI, cloud computing, big data, and IoT),
focuses on the integrated application of AI and smart logistics scenarios, carries out R&D of intelligent logistics
humanoid robots with material handling as the core function, and has formulated a clear industrial development
plan. In addition, the Company has developed key technologies such as AI algorithms and multi-modal perception.
The proprietary X1-series intelligent logistics humanoid robot was grandly launched at CeMAT Shanghai in later
October, drawing widespread attention from the industry. The Company has creatively integrated an omnidirectional
wheeled chassis with bionic dual-arm design, adopted a bionic structure with 22 independent degrees of freedom
and multi-dimensional perception technologies (e.g., 3D cameras and 3D LiDAR), achieving 360° environmental
perception and millimeter-level operation accuracy. Such design combines the efficient mobility of wheeled
equipment with the dexterous operation capability of humanoid robots, capable of performing complex tasks such
as carton/bin transportation, palletizing & depalletizing. This successfully shatters the rigid limitations of traditional
automated equipment and provides flexible solutions for unstructured logistics scenarios. The Company took the
lead in successfully applying for the "Humanoid Robot Machine with Precise and Dexterous Operation and Typical
Industrial Application Demonstration" project under 2026 Zhejiang Province’s "Pacesetter" Science and Technology
Program.
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Service-oriented Development
Technology Integration Opportunities
Following the service-oriented transformation trend of the global manufacturing industry, the Company Grasp the opportunities arising from the integration of cutting-edge technologies (e.g., AI, cloud
independently developed the industrial vehicle cloud management system (FIMS) based on big data, taking the lead computing, big data, IoT, and embodied intelligence) and industrial vehicles, continuously invest in
in building life-cycle service system in the industry to provide value-added services such as remote diagnosis and core technology R&D, overcome multiple key technologies and promote their practical application,
intelligent operation & maintenance for global warehousing, port and manufacturing scenarios. The system has
and drive the coordinated innovation of products and technologies.
connected more than 50,000 industrial vehicles, with a service network covering the EU, Southeast Asia and North
America. The Company creatively built an intelligent protection system integrating ADAS driving assistance and
FIMS remote management functions to monitor "personnel and vehicle status" in real time from two dimensions,
effectively improving vehicle operation safety. Through service-oriented innovation, the Company is transforming
from a traditional equipment manufacturer to a manufacturing service provider, building an intelligent service
ecosystem covering the life cycle of equipment for global customers and continuously empowering the high-quality Global Market Opportunities
green and low-carbon development of the industry.
Relying on the full-series product matrix and core technological advantages, explore the global
market, develop customized products for segmented markets such as North America, build a global
collaborative supply chain system and service network, and increase the presence in international
Back Office Management Data Analysis Report
market.
Manager Safety Management, Efficiency Analysis, Decision-
Fleet Operation Operation Type
Efficiency Analysis, Cost Analysis, maker
Maintenance Management Improvement Proposal
Risk Identification and Response
Driver APP After-sales Service APP
Technological R&D Risk
Driver Card Swiping for Vehicle
Startup, Fault Reporting
Remote Maintenance,
Maintenance History
After-sales
Vehicle Information, Predictive Maintenance, Service
Operation Status Proactive Maintenance In response to risks such as high difficulty in tackling core technologies and uncertainty in the return
on R&D investment, bring down the risk of R&D failure by establishing a sound R&D innovation
system, building professional R&D teams and conducting system-based R&D by virtue of state-level
Fleet Intelligent Management System (FIMS) technological innovation platforms; formulate measures for rewarding scientific and technological
achievements to stimulate R&D vitality, accelerate the transformation of innovation achievements and
improve the return on R&D investment.
Intellectual Property Risk
Impact, Risk and Opportunity Management
In response to risks such as infringement of innovation achievements and slow-paced confirmation
The Company accurately identifies the sustainable development impacts, risks and opportunities in the of intellectual property rights, build a comprehensive intellectual property management system,
innovative development of the industrial vehicle industry, and establishes system-based identification, expedite right confirmation via the patent pre-examination mechanism, and set core technological
evaluation, monitoring and management measures. Through technological breakthroughs, resource integration, barriers; integrate the intellectual property strategy into technological development plans to complete
market exploitation and ecosystem construction, the Company amplifies the positive impacts brought by intellectual property planning and protection from the source of R&D.
innovation, avoids potential risks and seizes opportunities arising from industrial transformation.
Opportunity Identification and Seizure
Market Competition Risk
Industrial Transformation Opportunities In response to the ever-increasing competition in the high-end and intelligent segments of the
industry, take product greening, intelligence and high-end development as the direction, continuously
Seize the opportunities arising from industrial transformation towards intelligence, greening, launch new products and technologies to fill market gaps and enhance core product competitiveness;
globalization and service-oriented development, gain a foothold in new tracks such as intelligent expand international high-end markets and build differentiated competitive edges through global
logistics, new energy industrial vehicles and humanoid robots, develop intelligent logistics total promotion and technology & capital export.
solutions, new energy products and intelligent equipment, and seize the development opportunities
in high-end markets and cutting-edge fields.
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Positive Impacts and Amplification Measures Forklift Sector
Electric
Class I:
Counterbalance
Relying on the systematic advantages of technological innovation platforms at provincial level and above (including
the National Enterprise Technology Center, National Accredited Laboratory, National Industrial Design Center, National Forklifts
Postdoctoral Research Station, Zhejiang Industrial Vehicle Engineering Technology Research Center, Zhejiang
Academician Expert Workstation and Zhejiang Key Enterprise Research Institute), the Company focuses on the
Reach
in-depth integration of cutting-edge technologies (e.g., AI, new energy, 5G and IoT) and industrial vehicle scenarios. It
Class II:
delves into technological fields including green intelligence, comfort and safety, high efficiency and reliability, Forklifts &
intelligent logistics and digital R&D of industrial vehicles, continuously increases investment in the R&D of core Order Pickers
industrial vehicle technologies, masters a series of key technologies for industrial vehicles and key components, and
builds a full-range product system, with new energy and intelligent logistics products leading the industry.
Class III:
Warehouse
Trucks
Internal
Class IV+V:
Combustion
Counterbalance
Forklifts
American-style
Products
Intelligent Logistics Sector
Logistics Intelligent
Humanoid Handling
Robots Robots
Indicators and Targets
Intelligent
Product Innovation Indicators Inspection
System
Integration
Robots
Completion of Core Indicators in 2025
Other Complete Vehicle Sector
Keeping abreast of global market demands, the Company continuously carries out product R&D and
innovation, and has built a full-range and diversified product portfolio covering 1t-48t internal
Port Machinery
Other Vehicles
combustion forklifts, 0.6t-48t electric forklifts, container reach stackers, empty container handlers,
tractors and electric warehouse vehicles, with over 8,000 product types and tens of thousands of
specifications.
Component & Parts Sector
Key
Components
During the reporting period
Tens of
Lithium Batteries
Over
Chargers
product types
thousands
of product specifications
Conveyor Lines
Diversified Products
of Hangcha Group
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Intellectual Property Indicators
Gain a foothold in the new track, namely the intelligent logistics field,
and develop intelligent logistics robots such as forklift robots, order Number of 2025 Number of 2025 Cumulative Number Cumulative Number
Patent Category
picking robots, heavy-duty robots, latent lifting robots and transfer Applications Grants of Applications of Grants
robots, as well as stackers, conveyor line systems and intelligent
logistics management systems, providing users with customized Invention Patent
intelligent logistics total solutions.
Utility Model Patent
Design Patent
Software Copyright
Overseas Patent
Focusing on the product development towards greening, intelligence and high end , the Company successfully launched
more than 60 new products and technologies in 2025, many of which filled domestic and foreign market gaps, providing
solid support for the implementation of the Company's “High-end, Globalized, and Diversified” strategies. Among them, the Note: The above intellectual property data cover Hangcha Group and its controlled subsidiaries.
X-series hybrid forklift (5-10t), the world's first mass-produced 309V diesel-electric hybrid forklift, creatively adopts a
dual-power architecture of "Diesel Power + Lithium Battery Energy Storage”, bringing down fuel consumption by 40%
compared with traditional internal combustion forklifts and filling the domestic market gap of related products. The
high-voltage lithium-ion rough terrain forklift (1.5-1.8t) further expands the Company's high-voltage product portfolio, with
performance comparable to internal combustion rough terrain forklifts, achieving massive application in scenarios such as
mines and infrastructure construction. The four-point small wheelbase dedicated lithium-ion forklift (1.5-4t) is equipped with
an unprecedented dedicated lithium-ion platform for small wheelbase models, featuring high efficiency, safety, reliability R&D and Innovation Indicators
and comfortable driving, precisely meeting the demand of the North American segmented market. The XA series stand-on
& sit-down pallet truck creatively achieves dual operation modes, balancing excellent operation performance and
comfortable driving experience. The X-series omnidirectional side electric forklift (2-3t) has six driving modes, flexibly Proportion of R&D Number of Proportion of R&D
Number of
adapting to complex operation scenarios such as narrow aisles and dense warehousing, and greatly improving space Item R&D Investment Amount Investment in Operating R&D Technical Personnel in
Invention Patents
utilization and operation flexibility. Revenue Personnel Total Employees
Indicator RMB 858.9468 million 4.84% 1,337 18.48% 470
The Company seizes the strategic opportunities arising from the industry's transformation toward
intelligence, greening and globalization, keeps abreast of the diversified demands of the global market, takes
high technical content, high added value and high reliability as the core product positioning, and adopts the
dual-driving path of “Technological R&D + Global Promotion”. In the meantime, the Company focuses on the
collaborative innovation of products and technologies, accelerates the release of innovation momentum,
and achieves leapfrogged upgrading from “Single-point Breakthrough” to “All-around Leadership”.
Centering on technological fields such as new energy, intelligence and control experience, the Company
keeps delving into core technological breakthroughs, overcomes and applies multiple key technologies
including regional mode adaptive control system, high environmental adaptability on-board charger,
localization of dual-drive transmission, VNA truck aisle safety control technology, steer-by-wire chassis
technology, container reach stacker spreader safety detection system, general handheld unit, VCU
popularization and application, EV electrical & electronic system architecture, and new-generation intelligent
interactive instruments. In addition, the Company conducts continuous and efficient R&D and launches a
series of new energy products and intelligent industrial vehicles onto the market, providing diversified green
The Company's technological innovation achievements have and intelligent solutions for global customers.
been highly recognized by the industry, and conferred multiple
heavyweight sci-tech awards, demonstrating the Company’s
strong technological strength. Among them, the project "Key
Technologies and Industrialization of High-performance
High-voltage Electric Forklifts" was appraised by an
academician-led appraisal committee as having "Overall
Internationally Leading Technology", and conferred the Third
Prize of Zhejiang Provincial Science and Technology Progress
Award. The “45t High-adaptability High-voltage Lithium-ion
Container Reach Stacker” was recognized as the first set of
major technical equipment in Zhejiang Province. The
"Research and Application of Key Technologies for 1.5t-2t
Dedicated Lithium-ion Mini Pallet Truck” won the First Prize of Award Certificates
Zhejiang Machinery Industry Science and Technology Award.
The "X1 Series Wheeled Logistics Humanoid Robot" won the
Zhejiang Robot Annual Product Award.
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Standardization Indicators
Core Goals of Innovative Development
In 2025, the Company presided over and participated in the formulation and revision of 1 international standard, 21
national standards, 22 industrial standards and 5 group standards, building a multi-level and multi-domain
standardization matrix. Among them, the national standard Quantitative Methods and Requirements for Greenhouse
Gas Product Carbon Footprint - Industrial Vehicles led by the Company is the first of its kind in China, providing a
scientific basis for industrial carbon emission reduction and carbon trading, and demonstrating the Company's
technological foresight in the green and low-carbon field. The Company won 2 Typical Cases for the Application and Product and Technological Goals
Promotion of Group Standards issued by the Ministry of Industry and Information Technology in 2024. Keeping up with Continuously focus on the development direction of greening, intelligence and high-end development, constantly launch new products and
cutting-edge technological trends and actively expanding new standardization fields, the Company successfully technologies to fill domestic and foreign market gaps, maintain the industry-leading technology and performance of new energy products and
joined the Humanoid Robot Standard Working Group of the National Technical Committee on Robotics intelligent equipment, and realize the industrialization and massive application of cutting-edge products such as humanoid robots.
Standardization (TC591) in 2025 and participated in drafting 2 national standards of the Technical Requirements for
Humanoid Robot series.
Intellectual Property Goals
Continuously increase the number of applications and grants for invention patents, strengthen overseas patent planning, further improve the
intellectual property protection rules, build a more trustworthy core technological barrier, and promote the efficient value transformation of innovation
achievements.
R&D Investment Goals
Continuously increase investment in core technology R&D, maintain a reasonable proportion of R&D investment in operating revenue, continuously
expand the R&D team, raise the proportion of R&D technical personnel in total employees, and strengthen the systematic capability of technological
innovation.
Rough-terrain trucks - Safety requirements and verification - Part 1: Market and Globalization Goals
Variable-reach trucks
Further increase the market share of new energy products and intelligent equipment, continuously expand the global market, and improve the global
Rough-terrain trucks - Safety operation requirements - Part 1: Variable-reach trucks supply chain and service network.
Industrial vehicles - Verification of stability - Part 3: reach and straddle trucks
Standardization and Industry
Leadership Goals
Rough-terrain trucks - Safety operation requirements - Part 2: Slewing trucks
Continuously predominate and participate in the formulation and revision of international, national and industrial standards in fields such as industrial
vehicles and humanoid robots, improve the green and low-carbon standard system including industrial vehicle carbon footprint, and shore up the
Explosive - proof industrial trucks - Part 1: Battery-operated industrial trucks leading position in the field of industrial standardization.
Battery reach forklifts
Sustainable Development Goals
Rider-operated counterbalance forklifts of 10000kg~65000kg Further optimize the service system, expand the access scale and service scope of the cloud intelligent forklift management system; continuously
promote product carbon emission reduction, help customers and the industry achieve green and low-carbon development, and lead the industrial
vehicle industry into a higher stage of intelligent, green and sustainable development.
Industrial trucks—Sustainability—Part 1:Vocabulary
Industrial trucks—Sustainability—Part 2: Factors and reporting
Rough-terrain trucks—Visibility test methods and their verification—Part 2:
Slewing rough-terrain variable-reach trucks
Industrial vehicles - Terminology - Part 1: Types of industrial vehicles
Forklift attachments - Design specifications
Explosion-proof industrial trucks—Part 2: Internal combustion industrial truck
Forklift trucks - Fork arms - Dimensions
High-level order pickers
Battery pallet stackers
Forklift attachments - Three-way attachments
Bi-directional and multi-directional traveling forklifts
Three-way stacking forklifts
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Technology Ethics
To ensure the standardization of the system (rules), the Company has formulated relevant documents such as the
The Company attaches great importance to intelligent technology and technology ethics governance, taking “Safe, Secure, Supplier Management Rules, the Supplier Level Evaluation Measures and the Manufacturing Department Bidding
People Oriented, and Data-compliant” as the bottom-line principles for technological innovation. In the R&D and application and Procurement Procedures, to ensure the rational and orderly implementation of supply chain work and the safe,
of embodied intelligent products such as logistics humanoid robots, the Company strictly abides by the relevant national reliable and sustainable development of the supply chain.
ethical norms and standards on artificial intelligence and robots, and focuses on physical safety, functional safety, data
security and privacy protection to ensure that robots have clear behavioral boundaries, traceable decisions and controllable
operations. Upholding the concept of human-machine collaboration, the Company takes advantage of technological
empowerment to improve logistics efficiency and operational safety, promotes the healthy development of intelligent
equipment on a compliant, responsible and sustainable track, and assists in the high-quality transformation of the industry
through responsible innovation.
Material
Procurement Requirements
Decision Analysis
Supply Chain Security Inventory
Analysis
Procurement
Strategy
Cost Analysis
Procurement
Governance Top-Level Design and Right-Responsibility Architecture
Procurement
Inquiry and Procurement
Agreement
Procurement
Price Purchase Order
Application Agreement Implementation
Comparison
The Company's Board of Directors has set up a special ESG Working Group, and incorporated supply chain management into Purchase
the entire chain system of the group's strategic decision and performance appraisal. In the field of supply chain security, the Contract
Company has established a three-level linkage governance mechanism of "Strategy-Management-Implementation", fully Procurement Process
Online
integrating sustainable development requirements into all links of procurement, and promoting the green, compliant and Management Assembly
sustainable development of the supply chain ecosystem. Material Receiving and
Inspection Warehousing
Settlement and
Payment
The Strategy Committee of the BOD is responsible for identifying and supervising supply chain
risks that have a significant impact on the Company's business, including geopolitical risks, Price Supply Supplier
trade barriers and key material supply disruptions. At the same time, the committee Basic Procurement Supplier Files Information Information Evaluation
incorporates supply chain sustainable development into strategic considerations, adjusts the Management
supply chain organizational structure as needed, and ensures that the construction of the
Company's supply chain meets the needs of the Company's strategic development.
Decision-Making Level
The Company has established a Supply Chain Management Committee led by the Deputy
General Manager in charge of supply chain, the Chief Engineer in charge of technology, and the
Deputy Chief Engineer in charge of quality. Based on the operating objectives issued by the
Board of Directors and in response to the Company's development strategy, the committee
identifies key processes and risk points, divides the Company's procurement management
into three major parts: basic procurement management, decision analysis management and
Management Level procurement process management, and conducts management and control through system
software such as SAP and SCM.
Relevant supply chain departments carry out their work in accordance with the relevant system
requirements of the Company's supply chain, do a good job in collecting, evaluating and
introducing supply resources, sign supporting supply agreements to establish supply &
marketing cooperative relations, effectively supervise and manage the relevant activities of
suppliers during the cooperation period, make up for the shortcomings in the supply chain,
and promote the development of the supply chain in line with the Company's strategy. In
procurement practice, they strictly implement sustainable development requirements,
Implementation Level integrating sustainable development considerations into the entire process from supplier
selection, cooperation implementation to later evaluation.
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Strategy Green as the Engine, Global Deployment, Control over Core Push ahead with Global Manufacturing and Localized Supply
In face of the challenges from global industrial chain restructuring, Hangcha Group takes “Greening + Globalization
To respond to trade protectionism and regional market fluctuations, the Company quickens its pace in
+ Localization” as its core strategy to ensure supply chain security, deeply embeds sustainable development
going global. By establishing a manufacturing branch in Thailand and overseas subsidies and R&D
requirements into procurement practice, and promotes the green upgrading and high-quality development of the
centers in the Americas, Europe, Southeast Asia and other regions, the Company is committed to
entire supply chain.
improving the localized supply capacity of its overseas divisions, leveraging regional free trade
agreements to reduce tariff costs, thereby enhancing the resilience to cope with international trade
barriers and supply chain disruptions. In its global procurement planning, the Company maintains
clear relations with suppliers around the world, engages in open dialogues on procurement
cooperation and sustainability requirements, and promotes localized suppliers to implement its
sustainable procurement standards.
Deepen Supply Chain Collaboration for the “New Energy Strategy”
Centering on the “Dual Carbon” goals, the Company took the lead in proposing a full-series new Master Core Component Technology for Differentiated Competition
energy development strategy in the industry, in order to not just strongly developing new energy on
the product side, but also promote green manufacturing on the supply chain side. In the cooperation
process, the Company endeavors to promote the new energy and dual carbon strategies from the The Company's path to build core self-control capabilities in the supply chain and foster differentiated
dimensions of commercial contracts, product development, production process and material supply, competitiveness is as follows: independently produce differentiated core components to gain
aiming to drive core partners to complete process upgrading, reduce the carbon emission intensity of initiative; lock in technology sources through equity participation for professional and important
the entire industrial chain from the source, and jointly build a new green and low-carbon ecosystem. In components; achieve risk & benefit sharing through cooperative factory construction for global
procurement practice, the Company underscores the principle of resource efficiency first, giving high-quality component resources; extensively carry out strategic cooperation with high-quality
priority to products and services that can reduce waste, carbon footprint and resource consumption. industrial resources to build a sustainable industrial ecosystem. In the procurement and cooperation
In the meantime, the Company collaborates with suppliers to carry out sustainable innovation and for core components, the Company gives priority to suppliers with sound environmental management
develop environment-friendly products and services, with a view to promoting the upgrading of green systems, conformity to ethical and labor norms and advocacy of social responsibility, and takes
technologies and products on the supply chain side. sustainable development capacity as one of the core considerations in cooperation.
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Risk Management Full-Process Identification and Monitoring Green Supply Chain Goals
The Company incorporates supply chain risk identification into the comprehensive risk management system,
establishes early warning and response mechanisms for physical risks, policy & regulatory risks and technical By the end of the reporting period, the Company has driven more than 50 core partners to convert
risks, and includes sustainability compliance into the scope of risk monitoring, ensuring the sustainability and fuel-powered vehicles in their factories to lithium battery new energy forklifts. At the same time, the
compliance of procurement practice through multi-dimensional management. Company has vigorously promoted the recyclable turnover box project in the supply chain system,
effectively reducing the waste of packaging materials. So far, the recycling rate of packaging
materials has exceeded 85%, which is an important practical achievement of the Company in
implementing the principle of resource efficiency first. In the future, the Company will gradually
improve supply chain carbon footprint management, require core suppliers to cooperate in
low-carbon process transformation, and jointly reduce the carbon emission intensity of the
industrial chain. The Company will continue to deepen its communication with suppliers, clarify the
specific requirements and cooperation directions of carbon footprint management and low-carbon
Supplier Selection and Evaluation Rights Protection and Integrity Supply Chain transformation, further strengthen compliance monitoring, regularly evaluate the effectiveness of
Compliance Review Construction suppliers' low-carbon process transformation and the implementation of resource conservation,
The Company strictly selects suppliers, establishes and and link the evaluation results with suppliers' cooperation level and procurement share. The
implements a credit evaluation system, guards against
commercial ethics risks and supply quality risks from The Company attaches great importance to the rights Through the sunshine procurement platform and Company will continue to promote sustainable innovation, work with suppliers to develop
the source, and incorporates sustainable development and interests of suppliers, strictly abides by the clean-fingered practice management, the
indicators (e.g., environmental management, labor requirements of laws and regulations, rigorously Company strictly monitors commercial bribery low-carbon and environment-friendly materials, processes and products, and keep improving the
controls the payment time within the given scope, and activities, creates a fair and healthy business
rights and social responsibility) into the core dimensions
establishes a rapid response mechanism for disputes. environment, provides a clean and fair cooperation
green development level of the supply chain.
of supplier selection and evaluation. For key materials
and core components, it implements classified and Meanwhile, the Company gives priority to the timely premises for sustainable procurement practice,
hierarchical management over suppliers, conducts payment of undisputed funds to ensure the healthy and and ensures the effective implementation of
annual comprehensive scoring of suppliers from stable capital flow at the supply chain. The Company sustainable procurement policies.
different dimensions (e.g., external inspection has established a Compliance Working Group, which
qualification rate, assembly qualification rate, quality conducts compliance review of customer orders as per
improvement, on-time delivery rate, after-sales service, compliance requirements of major global markets, sorts
supply price, quality management capacity, R&D out the compliance requirements of the supply chain for
capacity and sustainable development capacity), relevant markets, and ensures the compliance of sales
identifies annual supply hazards based on the scores, & purchase orders. Simultaneously, the Company
and provides assistance and countermeasures. conducts compliance monitoring over procurement
Simultaneously, the Company advocates a supply activities, regularly evaluates whether procurement
landscape of at least three suppliers for each part activities comply with its sustainable procurement
category, as a way to reduce dependence on a single policies and relevant laws & regulations, and timely
source. identifies and rectifies non-compliance issues. During the reporting period
Received more than Total duration of more than
supplier visits hours
Indicators and Targets Quantitative Tracking and Continuous Improvement
Through specific quantitative indicators and annual targets, the Company measures and drives the improvement
of supply chain management performance, incorporates the achievements of sustainable procurement practice
into core assessment indicators, and promotes the continuous improvement of supply chain sustainability
capacity through quantitative tracking, training and continuous optimization.
Supplier Empowerment Goals
In 2025, the Company organized 62 supplier exchange and training activities of various kinds, received
more than 155 supplier visits, with more than 300 participants and a total duration of more than 3,000
hours for these activities, aiming to improve the overall quality and efficiency of the supply chain
through technical empowerment. Herein, the sustainable procurement policy was included in the core
training content, and training and education work was carried out to promote the effective
implementation of the sustainable procurement policy by internal procurement employees and relevant
supplier personnel, hereby improving the understanding and implementation of the entire chain for
sustainable procurement. Besides, the Company continuously provides sustainability-related guidance Fulfilling Commitments with Actions: Fulfilling Commitments with Actions:
to suppliers, helping them improve their environmental management systems, implement ethical and The Company passed the ESG accreditation Hangcha Brazil, a subsidiary of the Group, passed
labor norms, and enhance the sustainability level of the entire supply chain. by Holcim Group, an international VIP 100% qualification accreditation by Coca-Cola’s
customer, and practiced global supply supplier ?Embotelladora Andina S.A., implying its
chain compliance requirements supply chain sustainability management was
recognized.
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Equal Treatment of SMEs Product & Service Safety and Quality
The Company attaches great importance to the value of small and medium-sized enterprises (SMEs) in the supply chain
ecosystem, and takes equal treatment of SMEs as an important principle for supply chain construction. In strict accordance
with national laws and regulations in favor of the development of SMEs, the Company upholds the principle of fairness and
Governance Management System, System Construction and Organizational Guarantee
impartiality throughout the cooperation process, creates a good cooperation environment for SMEs, and achieves
reciprocal and win-win development with SMEs. The Company has established a systematic and standardized product and service quality management structure, as well as
a three-level management system including the Quality Manual, Quality Management System Procedure Documents and
Quality Management System Guidelines. Also, it has set up an independent quality control department to build a quality
control network covering the product life cycle. The Company strictly implements relevant quality management rules, and
assigns quality responsibilities to the entire chain of R&D, procurement, production, quality, sales and service, in order to
Loan Payment ensure the effective operation and continuous improvement of the quality management system.
At the after-sales service governance level, the Company has established professional service teams such as the Marketing
In such links as supplier access, selection and evaluation, and order allocation, no discriminatory Department, VIP Customer Department and User Service Department, formulated standardized rules such as the Service
thresholds have been set for SMEs. In view of development characteristics of SMEs, the Company Specifications, the Customer Complaint Handling Process, the Heavy-Duty Vehicle Product Delivery and Service Guarantee
has established differentiated evaluation dimensions, with a focus on innovation capacity and Work Specifications, the Customer Training Work Management Measures and the Industrial Vehicle After-Sales Maintenance
product characteristics, in order to provide supply chain cooperation opportunities for competitive Technician Training Implementation Rules, leading to the formulation of a service governance mechanism with clear rights
SMEs. and responsibilities, standardized processes and efficient response. In 2025, the after-sales sector launched the digital
system upgrading, built a forklift life-cycle data tracking system, and promoted the transformation of after-sales management
from passive response to proactive prevention. Such a move helped systematically integrate service processes, embed
In terms of payment for goods, the payment time is strictly controlled within a given scope, and the
functions such as AI Q&A to improve service efficiency, in addition to realizing the online management and visualization of
payment process is optimized according to the capital flow characteristics of SMEs. The Company
maintenance/repair/parts management data.
gives priority to the payment of undisputed funds, and has set up an exclusive rapid dispute
response mechanism to efficiently resolve cooperation problems and protect the legitimate rights
and interests of SMEs.
The Company’s Formulated
professional service teams such as the Marketing Standardized rules such as the Service Specifications, the
Department, VIP Customer Department and User Service Customer Complaint Handling Process, the Heavy-Duty Vehicle
Department Product Delivery and Service Guarantee Work Specifications, the
Customer Training Work Management Measures and the
Industrial Vehicle After-Sales Maintenance Technician Training
Cooperation Links Implementation Rules.
The Company fully incorporates SMEs into the supplier empowerment system. All of the 62
supplier exchange and training activities organized in 2025 are open to SMEs, providing them with have established In 2025
professional guidance on technology, quality, sustainable development and other aspects,
targeting to help SMEs promote green manufacturing and low-carbon transformation, and assist A service governance mechanism with clear rights and The after-sales sector launched the digital system upgrading,
them in improving their all-around development capacity. responsibilities, standardized processes and efficient built a forklift life-cycle data tracking system, and promoted the
response transformation of after-sales management from passive
response to proactive prevention.
In the future, the Company will continue to improve the equal cooperation mechanism, expand the
cooperation with SMEs, tap their innovation potential, promote in-depth collaborative
development, and build an inclusive, diverse and sustainable supply chain ecosystem.
Strategy Quality Philosophy, Management Model and Service Strategy
The Company upholds the development philosophy of "Quality as the Foundation, Innovation as the Driving Force", takes
"Making Handling More Reliable" as the core value orientation, and deeply integrates modern management theories such as
life cycle management and all-around quality management, in order to build a quality management model with Hangcha
characteristics. The Company implements a dumbbell-shaped quality management model of “Strong at both ends and
Refined in the Middle”, strengthens the capabilities of R&D design and sales service, refines the production and
Supplier Empowerment manufacturing process control, and implements “Customer Orientation, Process Control, Full Participation and Continuous
Improvement” through the entire operation process, with a view to establishing a competitive quality culture system.
(technology/quality/sustainable development guidance) network. It advocates service strategies such as rapid response, refined service, customized solutions and long-term
strategic cooperation, and enhances market competitiveness and improves customer satisfaction and brand trust through
high-quality services.
Assistance in Green Manufacturing
and Low-Carbon Transformation
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Impact, Risk and Opportunity Management Product Recall
The Company has formulated special enterprise standards such as the Unqualified Product
Impact: Quality Achievements, Certifications & Qualifications, Service Results
Recall Management Procedure (QS287002) and the Customer Complaint Handling Process
(Q/HCC G0513). In 2025, the Company did not have any major safety and quality liability accidents
related to products and services, no product recall incidents, and the product recall system
Comprehensive System Accreditation remained in effective operation. In 2025, the Company received a total of 229 customer
complaints, with a 100% complaint handling completion rate and an average handling duration of
The Company has implemented a quality management system
complaint handling process, effectively safeguarding the legitimate rights and interests of
since 1992. It took the lead in passing the ISO9001:1994
accreditation in the industry in 1995, and passed the
customers.
ISO9001:2015 re-review in 2024. Its measurement management
system has continuously maintained high standards, for
example, the Company passed the third-level measurement
assessment in 1985, established a complete measurement and
testing system in 2007, obtained the Measurement
Management System AAA Certificate in 2011, and passed the Service Impact
re-review again in 2024 to renew the qualification. In 2025
The Company has established a nationwide
one-stop after-sales service network and For mainstream mid-to-high-end products,
Implementing Quality Taking the lead in passing ISO9001:1994 made clear service promises:
Management System accreditation in the industry
For mainstream mid-to-high-end products, Provide 2-year
Passing ISO9001:2015 Re-review provide a 2-year/4,000-hour warranty. For some -hour warranty
products, offer a warranty of up to 3 years/6,000
hours. On-site response is available within 8
hours in the same city, 24 hours outside the For some products, provide a warranty of
Passing the Third-Level Establishing a Complete Measurement city, and 48 hours in remote areas. Through
Measurement Assessment and Testing System
refined services, regular follow-up visits,
(Accreditation Certificate) customized solutions and strategic
cooperation, the Company increased its up to 3 years hours
Procuring the Measurement Passing the Re-review Again and
Management System AAA Renewing the Qualification customer satisfaction rate to 88.06, which is
Certificate significantly higher than the industry average.
Product Safety and Compliance
All the Company's products have been conferred special equipment manufacturing licenses, and Training Empowerment Impact
In 2025
some products have passed EU CE accreditation, North American UL accreditation, explosion-proof
accreditation, etc., reaching high-end industry safety and quality standards; exported lithium battery
forklifts and lithium batteries comply with the relevant certification requirements for the transportation
of dangerous goods. In 2025, conducted
The Company organizes systematic train-
ing for customers and internal after-sales
teams: training sessions
Quality and Safety Performance
In 2025, it conducted 146 training sessions for
customers, covering 2,653 person-times of
In 2025, the Company did not have any major safety and quality liability accidents related to products trainees. In the meantime, it organized 51 covering
and services, and its product quality and operational safety remained stable and controllable. sessions of after-sales technical training, with
total trainees reaching 1,459 person-times,
which continuously improved customers’
operation capabilities and the after-sales person-times
team’s professionalism, and enhanced brand
influence and customer trust.
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Domestic Customer Training Overseas Customer Training
Risk and Opportunity Management
Quality Risk Control
The Company adopts multiple mechanisms such as life-cycle quality management, independent quality inspection department, three-level
document system, refined process control, factory inspection and compliance certification to identify, prevent and control quality and safety risks
in advance across the links of product design, production, delivery and use, ensuring that no major quality & safety liability accidents occur.
Domestic After-sales Technical Training
Compliance Risk Control
The Company strictly abides by the regulatory standards for special equipment, measurement, export certification, dangerous goods
transportation, etc., and continuously maintains qualifications such as ISO9001, Measurement Management System AAA, CE, and UL to ensure
compliant operation in domestic and international markets.
Complaint Risk Management
The Company has established a standardized complaint handling process and rapid response mechanism, in order to proactively identify and
resolve customer dissatisfaction through on-site investigations, regular follow-ups, customer training, and service network sinking, bring down
service-related risks, and improve customer retention and corporate reputation.
Development Opportunities
The stable and reliable product quality and efficient service system have become important cornerstones for the Company's brand premium,
market expansion, overseas business growth, and long-term cooperation with major customers. Continuous quality improvement and service
innovation help the Company maintain a competitive edge in the industrial vehicle field and achieve synchronous improvement of brand value and
social benefits.
Overseas Customer Training
Indicators and Targets
By setting quantifiable key performance indicators and targets, the Company measures quality
management performance and drives continuous improvement.
Management
Dimensions
Pass Rate in Quality Management System
Management System Up to Standard
Accreditation
Coverage Rate of Type Approval for Special
Product Compliance Up to Standard
Equipment Products
Quality Accidents Major Product Quality Accidents Up to Standard
Customer Satisfaction Customer Satisfaction Up to Standard
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Data security and customer privacy protection Employees
Establishment, Operation and Specific Measures of the Data Equality and Diversity
In 2025, based on the implementation of its talent strategy, the Company continued to deepen the improvement of the human
Security Management System, as well as the Certification resource management system, strictly observed national laws and regulations such as the Labor Law of the People's Republic
of China and the Labor Contract Law of the People's Republic of China as well as industry standards, adhered to the bottom line
In strict accordance with the relevant laws and of employment, explicitly prohibited the employment of child labor and forced labor in any form, and resolutely eliminated all
regulations such as the Data Security Law of the People's types of rule-breaking employment behaviors. The Company equally treats candidates of different genders, ages, ethnic groups,
Republic of China, the Company has formulated data cultural backgrounds and religious beliefs, providing equal competition opportunities and development platforms for all
security rules and regulations such as the Q/HCC candidates who meet the job requirements. Aside from that, the Company standardizes the rules for employees' labor contracts,
G0137-2011 Rules for the Management of Computer leave, overtime, etc., and effectively protects the legitimate rights and interests of employees, demonstrating its corporate social
Room, the Q/HCC G1504-2013 Corporate Network responsibility and humanistic care, and continuously optimizing the talent introduction and cultivation environment.
Management Regulations, the Hangcha Group Network
Security Incident Emergency Plan and the Information
System Emergency Plan, and established an information 2025 Company Employee Statistics 2025 Company Employee Gender Distribution
security management framework to coordinate the
overall strategic planning on the Company's information
security and to promote the orderly implementation of Labor Contract Five Insurances and One Employee Female Employees Male Employees
information security work. Signing Rate Fund Payment Rate Turnover Rate
In 2025, no data security incidents occurred in the
Company. Statistics by Age
Establishment and Operation of the Customer Privacy
Protection System and Rules
In strict accordance with laws and regulations such as the Personal Information Protection Law of the People's
Republic of China and the Information Security Technology - Personal Information Security Specification, the as of the end of 2025
Company has formulated the Rules of Hangcha Group for the Management of Customer Privacy to specify the
compliant use of customer data and ensure the privacy security of its partners and customers. The Company has
established an emergency plan for security incidents such as data leakage to ensure timely response and handling. Time 30 years old and below 31-41 years old 41-50 years old 51 years old and above
Each department of the Company has set up data security officers who are responsible for data security and privacy
protection in their respective departments. By virtue of technologies such as data encryption, data masking and
access control, the Company ensures data security and strictly controls data transmission. Where relevant positions Statistics by Education Level
need to retrieve the data of partners and customers for external use, photocopying or electronic transmission and
other purposes, they must obtain the approval of relevant responsible persons and complete filing. In 2025, the
Company achieved a 100% encryption coverage rate for customer privacy data and a 100% desensitization rate for
sensitive data. For information leakage, the Company will take punitive measures as per regulations to effectively
ensure data security.
In 2025, no customer privacy security incidents occurred as of the end of 2025
in the Company. Time Bachelor's degree and above Junior college Below junior college
In 2025, the Company carried out 13 data security emergency plan drills, covering 80 person-times of employees from
relevant departments such as information technology, operations, and sales, effectively improving the data security
emergency response capability of all employees. Statistics by Professionalism
Technical Administrative Production Financial
Time Total Employees Sales Personnel
Personnel Personnel Personnel Personnel
As of the end
of 2025
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Talent Attraction
The Company continuously improves the Employee Recruitment Management Measures, further refines recruitment During the reporting period
standards, standardizes recruitment processes, optimizes recruitment channels, and strives to optimize a
market-oriented, standardized and professional talent selection & employment mechanism to ensure that talent The total amount of various special government Funds in response to support
introduction is synchronized and accurately matched with the Company's strategic development. subsidies obtained for fresh graduates was about policies were about
,
The Company continues to deepen school-enterprise cooperation and industry-education integration, and adopts
multiple measures to promote the precise matchmaking between talent cultivation and industrial needs.
million yuan yuan
The Company deepens its The Company leads the innovation
cooperation with universities, The Company implements
in skilled worker education and
promotes the order-based cultivation to plan
empowers the AI-based talent
industry-university-research talent supply ahead of schedule.
cultivation.
collaboration in education
The Company has established It has established the "Hangcha As a council member unit of the
in-depth school-enterprise
cooperation with Zhejiang
Order Class" with Hangzhou
Polytechnic to focus on two
"Artificial Intelligence +"
School-Enterprise Cooperation
Talent Training and Development
University of Science and training orientations such as Alliance of Technician Colleges in
Technology, Zhejiang University City logistics and after-sales services, Zhejiang Province, the Company Focusing on its strategic development needs, the Company has established a unique "Navigation" series training
College, and School of Information and to supply talents urgently actively participates in the system with Hangcha characteristics. In view of the development characteristics of employees at different levels and
Engineering of Hangzhou Dianzi needed by the enterprise. The formulation of the standards for
in different sequences, the Company has rolled out twelve special training programs, and fostered a learning and
University and other universities. By retention rate of the first batch of cultivation of high-quality skilled
means of co-construction of students exceeded 81%, and 58 talents, explores the innovative development ecosystem that covers all employees and runs through the career cycle.
courses, joint research on topics, students were recruited in the path for “Artificial Intelligence +
and joint cultivation of talents, the second batch, living up to the Skill Education”, and provides
Company optimizes its professional seamless connection from campus talent support for the digital
training system, achieves the to post. transformation of the industry.
in-depth integration of industry,
university, and research, and Lighthouse Program Pilot Program Voyage Program Sail Program
accurately introduces outstanding
graduates into the Company. Senior Managers Young and High-Potential R&D and
Middle-Aged Cadres Talents Production
Competition Program Spark Program Escort Program Kickoff Program
Salespersons Internal Trainers Highly Skilled New Employees
The Company earnestly practices the concept of humanistic care, takes the initiative to provide all-around guidance
for eligible new employees, accurately implements relevant government policies, and assists them in applying for Talents
various special government subsidies such as living subsidies and rental subsidies for fresh graduates, with a total
application amount of about 1.8 million yuan, effectively alleviating the living pressure of new employees and Navigation Program Starry Sky Program Blue Ocean Program Hangcha Lecture Hall
enhancing their sense of belonging and happiness.
In addition, the Company actively responds to the Production Interns After-Sales Interns Academic Education All Employees
national policies on stabilizing employment and
promoting development, and implements the
application requirements for various government
support policies. So far, the Company has
successfully obtained a number of policy funds
including stable post subsidies, one-time subsidies
for staff increase, and corporate subsidies for
Talent Team Construction
independent talent introduction within the district,
with total amount reaching approximately 908,000
yuan. This not only effectively brings down the The Company continuously strengthens the construction of its
enterprise's human resource operation costs, but talent team. It takes strategic development as the orientation to
also provides strong policy and financial support for build a diversified talent echelon, with a view to establishing a
the Company to continuously deepen talent "Three-In-One" training pattern for technical, skilled and Technical Type Skilled Type Interdisciplinary
introduction and training, stabilize the employee interdisciplinary talents, and providing solid talent support for Type
team, and achieve high-quality development. the high-quality development of the enterprise.
"Three-In-One" Talent Training Pattern
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Construction of Technical Talent Team
The Company was successfully selected as one of the first 6 Hangzhou-based private enterprises with the independent
evaluation authority for intermediate professional titles, and it took the lead in carrying out the independent evaluation In addition, the Company hosted the Hangzhou Industrial
for the intermediate professional title of "Special-purpose Equipment" engineers. Among 49 applicants in 2025, 40 System CNC Milling Worker Vocational Skill Competition
applicants passed the evaluation, representing a success rate of 81.63%. The Company achieved remarkable results in in June 2025. In October 2025, the Company organized the
professional title evaluation work. In 2025, a total of 1 talent with senior professional title, 11 talents with deputy senior Lin'an District Hoisting and Handling Machinery Operator
professional title and 55 talents with intermediate professional title were qualified, indicating that the Company gave full (Forklift Driver) Vocational Skill Competition. By actively
play to the role of professional title evaluation in talent cultivation and incentive. sponsoring various vocational skill competitions, the
Company earnestly fulfills its corporate social
responsibility, builds a platform for skill exchange and
improvement, and helps the improvement of employees'
Construction of Skilled Talent Team skill level and local skilled talent team.
The Company was successfully approved as one of the first 10 Hangzhou-based enterprises with the independent
evaluation qualification for the vocational skill level of first-level/senior technician, and the approved occupation
category is industrial vehicle assembling & debugging worker. So far, the Company has obtained the independent
evaluation qualifications for 7 occupations, covering 5 levels from first-level/senior technicians to fifth-level/junior
workers. In 2025, the company organized independent evaluation of professional skill levels for 3 occupations including
industrial vehicle assembly and commissioning worker, electrician and industrial vehicle maintenance worker. A total of Case "Pilot Program" Young and Middle-Aged Cadre Training Camp (Phase II)
senior workers.
A four-month "Pilot Program" (Phase II) training camp was organized, with
on the training goal of "1 transformation + 2 Skills + 3 Abilities", this
Construction of Interdisciplinary Talent Team
training camp creatively adopted the "Internal & External Dual-drive"
curriculum model to build an all-around ability improvement system. The
In June 2025, the Company became one of the first Zhejiang-based enterprises with independent evaluation qualifications students not only completed a lot of course learning and reading
for “Direct Identification” of professional skill levels. In August, the first working meeting on independent evaluation of activities, but also successfully summed up 31 high-quality work cases
industrial vehicle assembly and commissioning workers (direct identification) was convened, and 150 employees from and 27 enterprise micro-courses, effectively achieving the mindset
various production departments participated in this evaluation, covering three skill levels: junior worker, intermediate transformation and ability improvement from an “Executor” to a
worker and senior worker. According to the expert evaluation results, a total of 109 employees were granted the industrial “Manager”.
vehicle assembly and commissioning worker certificate in the end.
The direct identification and evaluation model, which is "based on the post ability evaluation of multi-skilled workers and
centered on work performance assessment", conducts a comprehensive evaluation from multiple dimensions such as
professional ethics, work experience and ability & performance, gets rid of the limitations of traditional assessment,
accurately mirrors the real level of employees, and helps with post ability assessment and risk identification. Through the
setting of multi-dimensional scoring items, this model guides employees to actively participate in vocational skills Case "Kickoff Program" New College Student Training Camp
competitions, technological innovation, "Five-small" innovations and other activities, fosters an innovative atmosphere
of "Learning from, catching up with, and surpassing each other", fully inspires employees to actively improve their skills,
and promotes the common development of the enterprise and employees. For newly-recruited college students, a 3-month training program was
further launched in 2025, and the program covered theoretical learning of
multiple general courses and professional courses, and modular
workshop practice & training. After the training period expires, college
Cultivation of High-Level Talents students at their respective departments will be guided by professional
mentors, helping them grow rapidly.
In terms of high-level talent cultivation, 24 new high-level talents were identified throughout the year, including 1 Type C
talent, 4 Type D talents and 19 Type E talents. Besides, 1 employee of the Company was selected into the Hangzhou
Special Talent Program and rated as "Hangzhou Outstanding Engineer", demonstrating the Company's outstanding
achievements in high-level talent cultivation.
Case College Students' Internship and Practice in Enterprises
Persist in Craftsman Cultivation, Deepen Training through Competitions The Company undertakes students' production cognition internship tasks
from a lot of universities such as Zhejiang University of Technology,
Zhejiang University of Science and Technology, Zhejiang University City
Skill competition has been a company-wide activity that Hangcha has kept organizing for more than 20 years, and served College, and Hangzhou Polytechnic, and actively builds a
as a vital platform for the Company to discover, cultivate and motivate talents. In the 2025 Skill Competition, the Group school-enterprise collaborative education platform. In 2025, it received a
uniformly organized competitions for 14 occupations, with more than 1,160 employees involved; each subsidiary also total of 9 batches of intern and visiting students (450 people in total),
organized competitions for 27 occupations. Through layers of selection and fierce competition, a large number of providing strong support for the universities’ practice-based teaching and
technical experts and model employees stood out. The trend of promoting learning, training and work through fulfilling corporate social responsibility with practical actions.
competitions has predominated in Hangcha, effectively stimulating the enthusiasm of all employees to study technology
and improve skills.
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Capital Investment Occupational Health and Safety Management
The Company attaches great importance to occupational health and work
safety management and has established a full-fledged management system.
During the reporting period For occupational health management, the Company has formulated a series
of rules such as the Procedure for the Management of Occupational Health
Training Coverage and Safety and the Procedure for Hazard Source Identification, Risk
the Company invested a total of
Rate Assessment and Control to safeguard the employees’ health rights and
interests in an all-around manner. For work safety management, the
Company has formulated such rules as the Work Safety Inspection Rules,
million yuan in employee the Procedure for the Control of Accidents (Incidents) and the Procedure for
training and development in 2025 Emergency Preparedness and Response to effectively guard against all
kinds of safety accidents. To ensure the effective implementation of these
rules, the Company has specially set up the Security Department, which
works as a specialized management organ to coordinate core functions
such as occupational health monitoring, safety hazard investigation, and
response to emergencies. Through the organic combination of system
Company Position System Setting and Employee Promotion, Selection and Career Development Mechanism norms and organizational guarantees, the Company continuously promotes
the steady improvement of its occupational health and safety management
level.
By the end of the reporting period, all production subsidiaries of the
Senior Chief Designer Company Senior Management Company had passed the ISO45001 Occupational Health and Safety
Management System Certification, achieving 100% coverage and effectively
improving the occupational health and safety management level.
Chief Position
Chief Designer
Deputy Middle Management Position
Deputy Chief Designer Review of the Occupational Health and Safety Management System of Hangcha Group in 2025
Assistant
Internal Review External Review
Designer
Supervisor
composed of 38 internal auditors Team conducted on-site audits on the
Designer Assistant General Employees audited 44 departments of the continuous effectiveness, standardization,
Company. adequacy and applicability of the Company's
quality, environment and occupational
general non-conformity items operation, and a total of 35 departments
(including 5 in quality, 0 in environ- were sampled.
ment and 12 in occupational health
Technical Channel Management Channel and safety) and 16 recommended
follow-up items were found.
Talent Development Channel During the reporting period, the Company
successfully passed the external audits.
To build and improve a scientific talent management system fit for the Company's strategic development and enhance the
core competitiveness of talents, the Company, based on the needs for diversified business development and the employees’ Each responsible department rectified
appeal for individualized growth, has systematically established four core career development channels respectively for the non-conformity items, and each
technical series, management series, production series and marketing series, achieving the full coverage of position series, group verified and tracked the
clear path for growth, and strong support for development. Upholding the talent development concept of “People-oriented, responsible department’s rectification
Student-centered Teaching”, the Company accurately devises differentiated career promotion paths for employees of effect.
different series according to their ability characteristics, professional advantages and career demands, shatters the barriers
in single-path promotion, and advocates a parallel and flexible promotion mode with multiple channels. This allows technical
elites to delve into their domains and become experts, allows management talents to coordinate management and lead
*All the above items have been rectified.
development, and allows production and marketing talents to base themselves on their positions and make breakthroughs,
striking a balance and achieving win-win between employee value and enterprise development. To activate the creativity of
talents and tap the potential of top-notch ones, the Company has opened a special promotion channel for core talents with
outstanding performance and excellent abilities, which helps simplify the promotion process, optimize the evaluation
standards, shatter the hierarchical restrictions, and expand the growth space. All in all, the Company makes every effort to In 2025, the Company's investment in occupational health and safety
create a sustainable ecosystem for “Attracting, Cultivating, Retaining and Using Talents", in order to cultivate a steady management totaled RMB 7.49 million.
stream of talents for the high-quality and sustainable development of the enterprise.
(*Note: The above data only covers the parent company of Hangcha Group.)
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Work Safety The Company's main occupational health and safety risk factors and preventive measures
The Company has established an all-around safety prevention and control mechanism that comprises management systems such as
the Safety Risk Hierarchical Management and Control System and the Work Safety Inspection System as well as management Process Flow Possible Preventive Measures
processes such as the Procedure for Hazard Source Identification, Risk Assessment and Control. Also, the Company has made every Consequences
effort to promote the implementation of relevant rules and processes, and carried out risk and hazard investigation actions at regular
Engineering measures: Explosion-proof equipment, ventilation equipment, gas detection and
intervals to comprehensively screen potential risks and hazards, living up to preparedness before challenges arise. Fire, explosion alarm devices
mechanical injury Management measures: Formulating operation procedures, strengthening on-site management,
object strike conducting occupational health examinations
The Company's work safety performance in 2025 Coating Line vehicle injury Training measures: Providing regular safety training
poisoning Personal protection: Wearing protective gloves, masks, shoes and uniforms
pneumoconiosis Emergency response: Establishing emergency response plans and conducting regular drills
Engineering measures: Explosion-proof equipment, ventilation equipment, gas detection and alarm devices
No accidents of serious injury or above occurred
Gas Station, Fire, explosion
Management measures: Strictly controlling the fueling operation procedures
Oil Tanker Training measures: Providing training on employees' safety awareness and emergency handling
Personal protection: Wearing anti-static work uniforms
Emergency response: Installing fire extinguishing equipment and conducting regular drills on
The injury rate per thousand people was
emergency evacuation and fire handling
Engineering measures: Explosion-proof equipment, ventilation facilities, gas detection and alarm devices
Hazardous Management measures: Formulating operating procedures, strengthening on-site management
Chemicals Fire, explosion Training measures: Providing regular safety training and drills
The Company carried out special safety inspections and Warehouse Personal protection: Wearing anti-static work uniforms
Emergency response: Establishing emergency response plans and conducting regular drills
safety investigations, with a completion rate of Engineering measures: Installing leakage protectors, insulation facilities
Management measures: Conducting regular electrical safety inspections, arranging dedicated
Power
on-site disposal plan drills and 3 emergency plan drills
operators
Distribution Electric shock, explosion Training measures: Providing training on electrical safety knowledge
were organized, with a coverage rate of Room Personal protection: Wearing insulating gloves and shoes
Emergency response: Setting up signs and operation guides for emergency power cut-off
Engineering measures: Anti-static devices, ventilation equipment, explosion-proof and
explosion-venting devices, safety alarm devices, automatic sprinkler systems
Fire
The Company's main safety training activities Powder-spraying Explosion
Management measures: Formulating operating procedures, strengthening on-site management
Line Pneumoconiosis Training measures: Providing regular safety training and drills
Safety Training Activity Training Content Personal protection: Wearing protective gloves, masks and fireproof uniforms
Emergency response: Establishing emergency response plans and conducting regular drills
The Company invited safety experts to train all intermediate management Engineering measures: Protective fences, protective nets, emergency stop switches
Safety Training for Intermediate
personnel on the criteria for determining major safety hazards in industrial Management measures: Safety operation specification management, occupational health examinations
Management Personnel
and trade enterprises, which achieved good results. Vehicle Mechanical injury
Assembling Line Electric shock Training measures: Providing mechanical operation training, occupational health training
The Company invited safety experts to train all team leaders on team safety Noise Personal protection: Wearing safety shoes, safety helmets, earplugs
Safety Training for Team Leaders construction, which effectively improved the safety management level of team
leaders. Emergency response: Conducting emergency rescue training, setting up first aid facilities and medicines
Engineering measures: Gas detectors, automatic cut-off devices
Providing important instructions of Xi Jinping on work safety, video materials
Safety Month All-employee related to work safety, and materials for the Work Safety Month activities. Also, Natural Gas Management measures: Establishing a safety inspection system
Training the Company organized an all-employee safety examination through DingTalk, Pipeline and Fire, explosion Training measures: Providing training on natural gas safety knowledge
and all employees passed the examination.
Facilities Personal protection: Communication equipment, mobile gas detectors
According to the principle of hierarchical and classified training, the Company Emergency response: Establishing a natural gas leakage emergency plan, implementing drills
and rehearsals
organized special safety training on dangerous chemicals, explosive dust,
Special Safety Training confined space and other contents for the safety officers of each department, Engineering measures: Gas detectors, automatic monitoring systems installing appropriate
explosion-proof equipment, setting up emergency fire extinguishing systems
as a way to improve the Company's work safety management level. Environmental
Management measures: Safety regulations in line with the standards
Organizing the safety managers of each department and subsidiary to partici- Protection Facility
Fire, explosion Training measures: Providing equipment operation training
Work Safety Standardization pate in the work safety standardization training class organized by the superior - Catalytic
Training department, aiming to improve the safety management level through theoreti- Personal protection: Wearing protective gloves
Combustion
cal learning and practical operation exercises. Emergency response: Establishing an environmental protection accident reporting and
emergency response mechanism
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Occupational Health Compensation and Benefits
The Company has formulated such management rules as the Occupational Disease Prevention and Control Management
Rules and the Procedure for the Management of Occupational Health and Safety, and it is committed to safeguarding the In strict accordance with the relevant laws and regulations such as the Labor Law of the People's Republic of China, the
employees’ rights and interests in occupational health. Besides, the Company has worked out the Occupational Health Goal Labor Contract Law of the People's Republic of China, the Employment Promotion Law of the People's Republic of China and
and Indicator Management Plan to clarify the assessment elements in various dimensions of occupational health. The the Law of the People's Republic of China on the Protection of Minors, the Company has formulated internal rules such as
Company organizes physical checkups for workers with occupational hazards, and conducts on-site occupational health the Employee Handbook. It insists on lawful and compliant employment, and has purchased endowment insurance,
detection and status quo evaluation, so as to effectively prevent and control the hazards of occupational diseases. work-related injury insurance, unemployment insurance, medical insurance and maternity insurance for employees in
The Company has not only purchased basic medical insurance for employees but also put in place the Implementation accordance with the provisions of the Ministry of Human Resources and Social Security and the relevant laws and
Measures for Mutual Medical Assistance of Employees. As a result, the Company has built a multi-level health guarantee regulations of the places where each subsidiary is located. Also, the Company has implemented the housing provident fund
system. As of the end of 2025, the Company has purchased the “Hangzhou Mutual Medical Assistance Insurance for system.
In-service Staff” for 7,233 employees, providing them with a stronger health guarantee and safeguarding the employees’ In 2025, the Company's total expenditure on compensation and benefits was RMB 1551.5766 million and the social insurance
happiness and well-being. paid for employees totaled RMB 223.5970 million.
During the reporting period
The Company's occupational health performance in 2025 The Company’s expenditure on The social insurance fees paid for
compensation and benefits totaled employees totaled
RMB million RMB million
Physical checkups and The participation rate of The completion rate of the
reexaminations for employees in annual status quo evaluation of
workers in toxic and physical checkup occupational hazards and
harmful occupations the rectification rate of
Employee Benefits
totaled 680 person-times, problems&hazards Interest-free housing purchase loans, allowances (including professional title allowances,
with a coverage rate of vocational qualification allowances, technical post allowances, and mentor allowances),
Multi-dimensional subsidies (including rental subsidies, transportation subsidies, and living subsidies), and
Incentives rewards (including sci-tech achievement rewards, cost reduction rewards, and special
rewards).
Providing employees with statutory leaves, including annual leave, sick leave, marriage
Leave Benefits leave, maternity leave, nursing leave, parental leave and other welfare leaves.
Free work meals, free shuttle buses, expatriate subsidies, annual physical checkups, talent
apartments, consolation allowances, high-temperature subsidies, beverage subsidies, winter
Other Benefits skin-care product subsidies, newspaper and book subsidies, spring outings, autumn outings,
team building activities, allowances for festivals such as May Day, Mid-Autumn Festival, National
Day, and Spring Festival, and living expenses for sick personnel and dependents.
Occupational Health and Safety Culture Structure of the Company's Compensation System
During the reporting period, employees of the Company participated in a total of 5 training sessions related to work safety Employee Compensation
and occupational health, with an average training duration of 8.2 hours per person and covering a total of 2,050 person-times (in ten thousand yuan)
of trainees.
Including
Wages, Bonuses, Allowanc-
es and Subsidies
Welfare Benefits
Social Insurance Premiums
Social Insurance Premiums
Trade Union Funds and
Employee Education Funds
Employee Physical Checkup Employee Training
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Staff Living Facilities Trade Union Management
The Company has formulated rules related to trade union, for example, AS344613 Female Employee Protection Rules, and
AS344614 Trade Union Management Rules. In 2025, the Company organized 2 sessions of the workers' congress, with a
Staff Canteen Staff Canteen cumulative expenditure of RMB 7.7037 million on trade union activities.
During the reporting period
The Company held a total of Total expenditure on trade union
workers’ congress sessions RMB million
Trade Union Management Structure: The trade union consists of 1 chairman, 1 vice-chairman, 13 members, 1 officer, 1
accountant, and 1 cashier. Under the trade union there are 10 branches and one fund review committee. The Company’s
employees spontaneously join the trade union, whereas the trade union strictly performs its safeguarding, building, participating,
and educating functions, representing and safeguarding the employees’ legitimate rights and interests.
Staff Dormitories and Supporting
Park Environment Facilities Trade Union Activities
Trade Union
Name
Award Name Conferred by
The Second Batch of Provincial-level Exemplary Units for Improving Staff Life Zhejiang Federation of
Quality Trade Unions
Supporting Basketball Court Dormitory Facilities
"Independent Evaluation of Intermediate Professional Titles, Dynamic Development
Hangzhou Federation of
of Talent Activities" has been rated as a High-quality Project under Hangzhou's "One
Trade Unions
Association, One Brand" Initiative.
Hangcha Xiao Juncheng was honored “Hangzhou Craftsman” Hangzhou Federation of
Trade Unions
Group
Hangzhou Federation of
Trade Winner Unit, Excellent Team and Outstanding Individual of the Safety & Health Cup Trade Unions
Union Energy-saving and Efficiency-enhancing Innovation Studio of No.1 General Assem-
Hangzhou Federation of
bly Plant and Entrepreneurship & Innovation Studio of Special Vehicle Branch won
Trade Unions
Excellent Innovation Achievements of Hangzhou Industrial System
The Five-small Innovation Achievements of the Company’s employees (including
Hangzhou Federation of
Yang Quan, Ye Junchao, Zhang Yiming and Liu Ling) were rated as Cultivation
Trade Unions
Achievements of Hangzhou Industrial System
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Social Issues
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Standardized Operation Standardized Operation
In 2025, in accordance with relevant laws and regulations, the Company abolished the Board of Supervisors (BOS),
and adjusted the institution name of "General Meeting of Shareholders" to "Shareholders' Meeting", and set up
Investor Relations employee directors. In accordance with updated laws, regulations, exchange rules and in response to the reform of
corporate governance structure, the Company revised five documents including the original Articles of
The Company has formulated the Information Disclosure Management Rules and Investor Relations Management Rules. Association, Rules of Procedure for General Meeting of Shareholders, Rules of Procedure for the Board of
It has always attached importance to balancing the sustainable development of the Company and shareholders’ return Directors, Working Rules for Independent Directors and Rules of Procedure for the Audit Committee, in addition to
on investment, successfully put in place the equity distribution plans for 2024 and the first three quarters of 2025, and renaming Rules of Procedure for General Meeting of Shareholders to Rules of Procedure for Shareholders' Meeting.
brought handsome economic returns to investors. The Company sets great store by investor relations. Led by the To strengthen market value management, further specify market value management behaviors, effectively protect
Secretary of the Board of Directors (BOD), special personnel from the BOD Office are responsible for investor relations the legitimate rights and interests of the Company, investors especially minority shareholders and other
management. Through various means such as telephone communication, email exchange, online performance briefing, stakeholders, and enhance the Company's investment value, the Company formulated the Market Value
securities company investor strategy meeting, industry exhibition, SSE E-interaction, on-site communication, Listed Management Rules in accordance with the Company Law, the Securities Law, the SSE Stock Listing Rules, the
Company Visit Activity, Collective Reception Day, roadshow and reverse roadshow, the Company gives an all-around Guidelines for Regulation of Listed Companies No. 10–Market Value Management and other relevant
and systematic introduction to its operating conditions to investors, answers investors' questions, keeps abreast of laws/regulations as well as the Articles of Association, and in light of the practical needs of the Company. This helps
investors' views and suggestions on corporate governance and development, and improves the two-way ensure the corporate governance rules keep pace with the times and adapt to regulatory requirements
communication mechanism between the Company and investors.
In accordance with the requirements of Corporate Governance Guidelines for Listed Companies
In 2025
the Company organized to convene Shareholders' Meetings, BOD Meetings, BOS (abolished) Meetings
The Company established an efficient investor communication system through diversified channels and Audit Committee Meetings.
In accordance with the norms and requirements for the three meetings of listed companies, the Company strictly
implemented standardized procedures for drafting and sending meeting notices, preparing and releasing meeting
Organized and participated in nearly industry exchange meetings, covering more
materials, as well as regulations governing meeting proceedings, voting documents, resolutions and announcements.
A total of -odd announcements were released throughout the year, amounting to more than official
than professional audiences
documents in total.
Maintained a reply rate to investor inquiries via the SSE E-interaction Platform
Risk Management and Internal Control
The Company successively held 2024 Annual, 2025 Semi-annual and Q3 Performance Briefings, interacted with
investors in real time through SSE roadshow platform, conducted in-depth exchanges on core topics such as strategy, Taking 2-3 years as a cycle, the Company conducts all-around risk investigation on all operation modules through
R&D, market, overseas business and logistics humanoid robots, continuously improved capital market transparency, a mixed use of regular reports, internal audit, special investigation, internal control evaluation and other means, in
and built a sound communication bridge. order to keep improving the risk database. For identified risks, grade evaluation and priority ranking are carried out
according to impact level and occurrence possibility, so as to ensure major and important risks are handled first. A
Shareholder Return special rectification and tracking mechanism is established to objectively evaluate the rectification effect.
The Company has built an extensive, efficient and sensitive early risk warning system and deepened the sinking
mechanism for risk identification and control. Grassroots risk management roles such as safety officers and
The Company values shareholder returns and clarifies the dividend distribution policy in its Articles of Association. To internal control officers are set up at the headquarters, various departments, subsidiaries and manufacturing bases,
maintain reasonable investment returns for public shareholders, the Company upholds the tenet of achieving acting as front-line sentinels responsible for daily risk monitoring, identification and initial response. As a result,
sustainable development and safeguarding shareholders' rights & interests to keep the continuity and stability of the the Company has built a bottom-up risk prevention and control network.
profit distribution policy.
Internal Control and Audit Supervision
Implementation Details of Cash Dividend Policy of the Company in 2025
In accordance with the Basic Norms for Enterprise Internal Control and other provisions, the Company updated and
improved the Internal Control Management Rules, built a concise and efficient internal control system, and
Equity distribution implemented on May 28 and November 26, 2025 integrated risk management into all links of operation and management. The Board of Directors, management team,
internal audit department and compliance department jointly form a risk and internal control management
organization to supervise and evaluate internal control management. Such organization is responsible for five
aspects including internal environment, risk assessment, control activities, information and communication, and
internal supervision.In 2025, the Company and its subsidiaries had no major violations or payment of major fines
Total cash dividends distributed (tax included): RMB for violations. The Company hired Pan-China Certified Public Accountants (Special General Partnership) as the
internal control audit institution for 2025 to evaluate the effectiveness of internal control of all functional
departments at the headquarters and subsidiaries at all levels. Audit results show that no major deficiencies were
Cash dividend of RMB per 10 shares (tax included) found in the design and implementation of the Company's internal control throughout the year, and Pan-China
Certified Public Accountants issued a standard Internal Control Audit Report with unqualified opinions. The
Company timely discloses the Internal Control Self-evaluation Report every year.
Note: Only the annual total distribution plan is disclosed herein, and the specific amount of each single distribution is not listed separately.
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Internal Communication and Reporting Mechanism Business Ethics Governance System
To improve risk management efficiency, the Company holds cross-departmental risk management coordination The Company has established a top-down business ethics governance structure with clear rights and
meetings at regular intervals to ensure that managers at all levels and key post personnel timely exchange risk responsibilities, forming a governance system with hierarchical responsibilities and collaborative linkage among
information and share management experience. the Board of Directors, management team, compliance working group, compliance management department and
By using internal enterprise communication platforms, knowledge management systems and other tools, the each business unit, fully covering the total management over business ethics, anti-fraud, anti-money laundering
Company builds barrier-free information communication channels to quickly convey risk early warnings and and interest conflict.
response strategies to every employee. In addition, employees are encouraged to take the initiative to report
potential risks or hidden dangers. By establishing an effective feedback mechanism and reward system, the
Company stimulates the enthusiasm of all employees to participate in risk management, in order to jointly create an Bear ultimate responsibility for business ethics and compliance management, be responsible for reviewing rules
open, transparent and collaborative risk management culture. related to business ethics and anti-unfair competition, as well as major compliance risk matters and annual
Board of compliance work, supervise the effective implementation of compliance management requirements by the
Business Ethics
Directors management team, and coordinate the review over the system plans and major risk disposal plans related to
(BOD) anti-commercial bribery & anti-corruption, anti-unfair competition, anti-commercial fraud, anti-money laundering
and interest conflict control.
Anti-unfair Competition Law of the Anti-Monopoly Law of the People's
People's Republic of China Republic of China Responsible for organizing and implementing business ethics construction, anti-unfair competition and
Management anti-corruption work, coordinating efforts to promote the implementation of compliance rules, risk prevention &
Company Law of the People's Labor Contract Law of the People's Team control and supervision & inspection, taking the lead in organizing to implement specific business ethics
management measures, and coordinating cross-departmental implementation of relevant compliance work.
Republic of China Republic of China
Hangcha Group always regards compliant operation and integrity in contract performance as the cornerstone for
corporate sustainable development. It attaches great importance to the development of business ethics and the nder the guidance of the Board of Directors, responsible for implementing the Company's business ethics
maintenance of a fair competition environment, and strictly abides by national laws and regulations including the management strategies and objectives, ensuring the Company's operation complies with ethical and compliance
Anti-Unfair Competition Law of the People’s Republic of China, the Anti-Monopoly Law of the People’s Republic of requirements, and implementing the work arrangements related to anti-commercial bribery & anti-corruption,
anti-unfair competition, anti-commercial fraud, anti-money laundering and interest conflict control; construct
China, the Company Law of the People’s Republic of China, and the Labor Contract Law of the People’s Republic of Compliance
and improve the internal business ethics supervision system, undertake the functions of compliance
Working Group
China, as well as industrial regulatory requirements. The Group integrates the concepts of business ethics, (Important supervision and review, and assure the legality and morality of the Company's operation; responsible for
clean-fingered practice and anti-unfair competition into the entire process of corporate governance, production & Guarantee) accepting internal and external reporting and complaints, organizing investigation and analysis, determining the
operation, market expansion, supply chain management and overseas business. It continuously improves the nature of problems and putting forward handling suggestions; responsible for carrying out internal audit, risk
business ethics and compliance management system, and explicitly prohibits all illegal and rule-breaking acts such management, internal control and anti-fraud investigation and relevant work at regular intervals, formulating
as commercial bribery, embezzlement, unfair competition, commercial fraud, money laundering, interest transfer, improvement measures according to the review results, and continuously tracking the rectification of problems
bid rigging, false propaganda, commercial defamation, infringement of trade secrets and improper benefit to ensure the effective implementation of various measures.
conveyance.
Hangcha Group strictly controls risks arising from interest conflict, and strengthens the identification, control and
supervision of compliance risks in key links including procurement, sales, bidding & tendering, project cooperation The Compliance Management Department (Legal Affairs, Internal Audit, Internal Control, Safety, etc.) is
and overseas market operation. During the reporting period, by optimizing internal management systems, Compliance responsible for the daily management of business ethics norms, anti-unfair competition, anti-corruption and
standardizing codes of conduct for employees, conducting regular training on business ethics and compliance, and Management anti-fraud, carrying out system construction, risk identification, compliance training, reporting acceptance,
promoting integrity culture advocacy, the Group has steadily enhanced the compliance awareness and professional Department investigation and disposal. As the centralized management department for anti-fraud, anti-money laundering
ethics of all employees and key post personnel. In external cooperation, the Group upholds the principles of and interest conflict control, the department carries out rule improvement, risk investigation and special
openness, fairness and impartiality, and strengthens compliance management and due diligence over suppliers, supervision in relevant fields.
distributors and business partners. It incorporates requirements for anti-commercial bribery, anti-corruption,
anti-unfair competition, anti-commercial fraud, anti-money laundering and interest conflict control into cooperation
due diligence procedures, in order to urge the whole industrial chain to abide by business ethics and fair
competition rules, and safeguard a sound and orderly market environment and industrial ecosystem. The Group Business Unit Bear the main responsibility for compliance management in their own fields, strictly implement relevant
has established efficient channels for complaints and reporting, and improved the mechanisms of supervision, (Single
Department and
regulations on business ethics and fair competition, strengthen risk control of key posts and key processes, and
verification, rectification and accountability. It holds a zero-tolerance attitude toward any violation of the above Subsidiary)
ensure compliance requirements are embedded in the whole business process.
business ethics, effectively protects the legitimate rights and interests of stakeholders including customers,
partners, investors and the general public, and advances the long-term stable, high-quality and sustainable
development of the enterprise through high-standard business ethics and compliant operation capabilities.
All employees receive risk management training, understand their own roles in risk management, take the
Employees initiative to report potential risks, and ensure the timely upward/downward transmission of risk information.
At present, the Company has 25 full-time personnel responsible for business ethics, compliance, internal audit
and anti-fraud investigation. All team members have a bachelor's degree or above, with professional
backgrounds covering finance, audit, engineering, law, investment and other fields. They hold professional
Professional qualification certificates such as Intermediate Accountant, Intermediate Auditor, Certified Public Accountant
Team (CPA), National Legal Professional Qualification Certificate and Certified Internal Auditor (CIA), so that they are
capable of doing good job in anti-commercial bribery & anti-corruption, anti-unfair competition, anti-commercial
fraud, anti-money laundering and interest conflict control, and providing talent support for the total management
of business ethics.
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Business Ethics Management Policies and Implementation Anti-unfair Competition and Fair Competition Policy
The Company strictly abides by relevant laws and regulations such as the Criminal Law of the People's Republic of The Company strictly abides by relevant anti-monopoly and anti-unfair competition laws and regulations, and
China, the Civil Code of the People's Republic of China, the Anti-unfair Competition Law of the People's Republic of prohibits behaviors such as false propaganda, bid rigging, commercial defamation and infringement of trade
China, and the Interim Provisions on Prohibiting Commercial Bribery Behaviors. Based on the Supplier secrets. It has clarified the identification boundary, prevention and control path and rights protection mechanism
Management Measures and Code of Employee Conduct, the Company has formulated the Anti-corruption and for unfair competition behaviors.
Anti-commercial Bribery Management Rules, established a full-dimensional business ethics management policy
system covering anti-commercial bribery & anti-corruption, anti-unfair competition, anti-fraud, anti-money
laundering and interest conflict control, and implemented this system in a rigorous manner.
Code of Business Conduct and Professional Ethics
The Company clarifies the bottom line of employees' professional ethics, requirements for clean-fingered practice,
and the declaration and avoidance rules for interest conflict, standardizing employees' professional behaviors in Code of Conduct Rights Protection Partner and Internal
daily operation. and Prevention Management
The Company strictly abides The Company has established The Company has
by the Anti-Monopoly Law, a regular rights protection incorporated anti-unfair
Anti-commercial Bribery and Anti-corruption Policy Anti-Unfair Competition Law mechanism to safeguard competition requirements into
and other laws and rights and interests through the due diligence and annual
regulations, explicitly legal litigation, administrative evaluation of suppliers and
The Company firmly opposes and explicitly prohibits embezzlement and dishonesty behaviors, strictly forbids any prohibits behaviors such as complaints or other means partners, and taken measures
form of commercial bribery, rebates, improper interest transfer and corrupt behaviors, and strengthens the control monopoly agreements, abuse targeting unfair competition such as warning, rectification
over high-risk links such as marketing, procurement and bidding. of market dominant position, behaviors such as brand and termination of
false propaganda, commercial counterfeiting, trademark cooperation against partners
defamation, bid rigging and infringement and confusing in breach of regulations. It
infringement of trade secrets. diversion. More than 30 civil standardizes the market
The Compliance Management Department took the lead in embedding prevention
It specifies business activities rights protection cases were behaviors of internal
and control requirements in key links such as procurement, sales, bidding &
such as market promotion raised in 2025, including the employees, improves the
Whole-chain Prevention tendering, and funds transfer. Before cooperation, suppliers are required to sign the
and brand publicity, and "Hangzhicha" trademark awareness of compliant
and Control Integrity Commitment Letter that explicitly prohibits commercial bribery and interest
focuses on preventing risks infringement and unfair competition through special
transfer. Performance is included in the annual compliance evaluation as an
such as interest conflict and competition case, battery training, and clarifies the
important basis for cooperation continuation and quota adjustment.
fraud associated with unfair trademark infringement accountability mechanism for
competition behaviors. criminal case, etc., which violations.
Procurement Link: Standardize the procedures of supplier selection, tendering & bid helped effectively purify the
evaluation and contract signing, clarify approval authority, and strengthen the market environment. The
interest conflict verification over procurement personnel. Company had no public
Sales and Cooperation Link: Strictly prohibit business cooperation through record of major administrative
Key Link Control improper interests, and monitor funds transfer such as sales rebates and project penalties or criminal
cooperation. accountability.
Fund Management Link: Strictly implement payment procedures, strengthen the
review over large-sum and abnormal funds, prevent corruption and fund
misappropriation, and carry out abnormal transaction verification in line with
anti-money laundering requirements.
Carry out regular supervision through internal audit, special inspection, reporting
verification and other means, insist on “Zero Tolerance” for discovered violations,
Supervision and impose penalties such as warning, demotion and termination of labor contracts
Accountability according to the circumstances, transfer suspected illegal and criminal cases to
judicial organs, and trace the source to make up prevention and control loopholes
simultaneously.
The Company has incorporated clean-fingered practice into regular training for all
employees, in order to raise risk awareness through law interpretation, case studies
and other forms. Leveraging the corporate training system, the Company invites
Training and Culture internal and external experts at regular intervals to conduct risk management
Development training covering employment safety, environmental protection, business ethics and
anti-fraud, so as to strengthen risk prevention. Internal communication platforms
and publicity boards are utilized to promote integrity culture, fostering a corporate
atmosphere of honest operation and clean-fingered practice.
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Anti-malpractice and
Supervision Policy
Internal Control
The Company has formulated the Reporting and Complaint Management Measures, established confidential and efficient reporting
The Company has established a mechanism for identification, prevention, investigation and channels, specified the acceptance, investigation, feedback and protection mechanism, and kept the reported information strictly
Anti-fraud,
accountability of fraud and malpractice risks, in order to guard against risks such as commercial confidential.
fraud, financial malpractice, data falsification and illegal operation. It has clarified the definition scope,
identification methods, prevention and control measures and accountability mechanism of
The Company attaches importance to the reporting management over incidents
commercial fraud behaviors, and integrated anti-fraud requirements into all business links such as
such as anti-commercial bribery & anti-corruption, anti-unfair competition,
procurement, sales, finance and project management. In addition, the Company prevents risks such
anti-fraud, anti-money laundering and interest conflict. It has set up a working group
as financial malpractice, contract fraud and business fraud through financial monitoring, business for the punishment and prevention of corruption as well as a compliance committee.
data verification, contract review and customer qualification verification. It carries out fraud risk Besides that, the Company gives attention to protecting the rights and interests of
investigation, and has established a fraud risk early warning mechanism. In 2025, no commercial fraud reporters during the investigation and handling of reported incidents. For the above
incidents occurred in the Company, and the anti-fraud and associated compliance prevention and behaviors verified to be true, in light of the seriousness of the circumstances, the
control system was improved through internal audit and special inspection. Company shall impose penalties in accordance with its administrative regulations
including the Employee Reward and Punishment Measures, the Measures for the
Investigation and Accountability of Liability for Wrongdoing Losses, the Measures
Reporting Overview for Administration of Integrity, Self-Discipline, Punishment and Prevention of Corruption,
the Notice on Establishing the Management Principles of the "Five Major Red Lines". Those
In strict accordance with relevant anti-money laundering laws and regulations, the Company has with serious circumstances shall have their labor contracts terminated; any party causing
established core control mechanisms such as customer identity identification, transaction record losses to the Company shall be held liable for compensation as per the law. Those
retention, large-sum and suspicious transaction reporting, as a way to strengthen risk prevention and suspected of criminal offenses shall be transferred to judicial authorities for handling.
control in links such as fund management, overseas business and cooperative transactions. The Where institutions and their employees having business dealings with the Company
Finance Department strengthens the anti-money laundering monitoring over capital flow, while the violate commitments under corporate regulations, their qualifications as suppliers,
Information Technology Department provides technical support for transaction data traceability, and service providers, agents and distributors as well as their bidding eligibility shall be
works with the Compliance Management Department to carry out special anti-money laundering revoked. Those suspected of criminal offenses shall be transferred to judicial
inspections to guard against risks such as money laundering and illegal fund transfer. In 2025, no authorities for investigation and punishment.
violations related to anti-money laundering occurred in the Company, and the requirements for
reporting large-sum and suspicious transactions were strictly implemented. The Company has set up a reporting hotline and email box to accept real-name or
Reporting and Complaint anonymous reports from internal employees and external third parties.
Report Hotline: 0571-88143257
Management Policy Email: hcjw@zjhc.cn
The Company has set up a business ethics incident investigation team with the
investigation scope covering anti-commercial bribery & anti-corruption, anti-unfair
Incident Investigation competition, anti-commercial fraud, anti-money laundering, interest conflict and
other aspects. In addition, it has established the handling process for business
ethics incidents, and clarified the responsibilities of personnel of each process.
Staff accepting reports and complaints or participating in investigations shall not
The Company has clarified the identification circumstances, declaration procedures, withdrawal arbitrarily provide any department or individual with relevant information of
Management Policy
requirements and disposal principles for interest conflict, established a dynamic management complainants and reporters or the contents of reports. Any illegal discrimination or
Protection of the Reporter
Interest Conflict
mechanism for interest conflict of employees and partners, and strictly prohibited seeking improper retaliatory conduct, as well as hostile measures against employees participating in
interests by taking advantage of position or cooperation convenience. Employees are required to investigations, are prohibited. Any person who illegally discloses the information of
declare interest conflict in accordance with regulations. The Company verifies and publicizes the informants or takes retaliatory actions against reporters shall be subject to
declared information, implements measures (e.g., post adjustment and withdrawal from business) dismissal and termination of labor contracts; those violating laws shall be
against personnel with interest conflict, carries out interest conflict control along with anti-commercial transferred to judicial authorities for handling as per the law.
bribery, anti-fraud and anti-money laundering work, and guards against risks such as interest transfer
and related violations. The Company conducts verification and management over interest conflict of
suppliers and partners, strictly prohibits seeking improper interests for themselves and related parties
by taking advantage of cooperation convenience, and ensures fair and compliant cooperation.
Training Statistics
Number of Number of Directors Total Number of
Directors Receiving Receiving Proportion of Employees Receiving
Anti-commercial Proportion of Anti-commercial Anti-commercial
Proportion of
Trained Trained Trained
Item Bribery & Bribery & Bribery &
Management
Supplier and Partner
Anti-corruption Directors Anti-corruption Employees
Compliance Policy
Personnel Anti-corruption
Training Training Training (Person)
The Company requires partners to sign compliance and integrity commitments, conducts compliance
due diligence, and incorporates business ethics requirements into supply chain management. In 2025 Fiscal Year
addition, the Company has incorporated anti-commercial bribery & anti-corruption, anti-unfair
competition, anti-commercial fraud, anti-money laundering and interest conflict control into the
partner compliance evaluation system.
Training Statistics
Item Jointly carry out training Number of Participants in Total Duration of Anti-monopoly
activities on anti-monopoly and Anti-monopoly and Fair and Fair Competition Training
fair competition Competition Training
Hangcha Group Co., Ltd. 2025 Environmental, Social and Governance (ESG) Report
Sustainable Development Feedback Form
Report Index Table
Dear Readers:
Disclosure Requirements Chapter in This Report
To further improve the level of our ESG work and the quality of the report, we sincerely invite you to
review this report and offer your valuable comments and suggestions. You are welcome to send us your
Response to Climate Change Response to Climate Change feedback form by mail, email, phone and other means. We will strictly keep your personal information and
submitted content confidential. Thank you!
Pollutant Emissions Pollutant Emissions and Waste Disposal
Waste Disposal Pollutant Emissions and Waste Disposal
Ecosystem and Biodiversity Protection Ecosystem and Biodiversity Protection
Environmental Compliance Management Environmental Compliance Management
Energy Utilization Energy Utilization
Water Resource Utilization Water Resource Utilization
Circular Economy Circular Economy 3. Is the information you expect to find fully covered in this report?
Rural Revitalization Social Responsibility
Social Contribution Social Responsibility
Innovation-driven Development Innovation-driven Development 4. What suggestions do you have for improving this report?
Technology Ethics Technology Ethics
Supply Chain Security Supply Chain Security
Equal Treatment of Small and Equal Treatment of Small and Medium-sized Personal Information
Medium-sized Enterprises Enterprises
Product & Service Safety and Quality Product & Service Safety and Quality Name Fax
Data Security and Customer Privacy Protection Data Security and Customer Privacy Protection Current Employer Contact Number
Employees Employees Position Email
Corporate ESG Governance Arrangements, Standardized
Due Diligence
Operation, Risk Management and Internal Control
Company Contact Info
Communication with Stakeholders Communication with Stakeholders BOD Office, F/9, Building A, Hangcha Science and Innovation Park, No.398 Shiqiao
Office Address Road, Gongshu District, Hangzhou City, Zhejiang Province
Anti-commercial Bribery and Anti-corruption Business Ethics Contact Number
Anti-unfair Competition Business Ethics Company Email
Hangcha Group Co., Ltd. National Service Hotline: 400-884-7888
Address: No.666 Xiangfu Road, Lin'an District, Hangzhou City, Zhejiang Province
Website: http://www.zjhc.cn Customer Service Hotline: 400-884-7888 ESG Dedicated Line: 0571-88141328, 88926713
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