Environmental, Social and Governance (ESG)
Adhering to the corporate vision of “becoming a competitive international pharmaceutical company” and the corporate mission of “innovation for human health”, Sihuan Pharmaceutical has integrated the concept of sustainable development into the Group’s strategic planning and business operations. While actively fulfilling its social responsibilities, we assume our own corporate responsibilities and thereby continuously create a trustworthy corporate image to practice sustainable development with practical actions.
The Group integrates environmental, social and governance (ESG) into its development strategy and continues to improve its ESG governance structure and operation mechanism. We established a three-tier ESG governance structure with the Board as the highest decision-making level, which clarifies various ESG work affairs and management responsibilities, effectively promotes all departments to participate in ESG work. Among them, the Chief Executive Officer is specifically responsible for overseeing ESG affairs.
ACT WITH RESPONSIBILITY AND SHARE THE FUTURE
Sihuan Pharmaceutical has always acted responsibly, assumed the responsibilities of a pharmaceutical enterprise, and contributed its corporate strength to the Healthy China initiative. Looking ahead, we will continue to provide high-quality products and services, and share a healthier, greener, more honest and beautiful future with more people.
Health Responsibility
Adhering to Quality Assurance to Lead a Healthy Future
Green Responsibility
Keeping the Safety Mission in Mind and Fulfilling Green Commitments
Governance Responsibility
Laying a Solid Foundation for Responsibility and Fostering a Culture of Integrity
Health Responsibility — Adhering to Quality Assurance to Lead a Healthy Future
The Group has always taken safeguarding patients' health as its mission, continuously increasing investment in pharmaceutical research and development, strictly controlling product quality, and contributing to the "Healthy China" initiative through concrete actions. We regard product quality as the lifeline of the enterprise's development, are committed to providing reliable products, and have set the following quality targets:
- Ensure that the first-pass yield rate of finished products and the timely investigation and closed-loop rate of production process deviations both achieve 100% annually
- Conduct regular product quality risk assessments, ensure that the closed-loop rate of rectification for high-level risks reaches 100% annually; achieve a 0% rate of major quality incidents annually
- Ensure that the timely reporting rate of adverse reactions and the timely investigation, handling and closed-loop rate of complaints both achieve 100% annually
- Ensure that the GMP compliance inspection pass rate reaches 100% annually
To achieve the above targets, we have systematically embedded life cycle assessments into the full-process management from product raw materials to factory dispatch. Currently, the assessment scope covers core environmental dimensions including land use, water depletion, pollutant emissions, greenhouse gas emissions and human toxicity. During the project implementation phase, we focus on assessing the land compliance of site selection, optimising land use efficiency and reducing unnecessary resource occupation; in the product production phase, we have established energy consumption, water use and emission control systems, focusing on the pain points of high energy consumption and high wear-and-tear of ageing equipment at our facilities, and regularly advance the planning and replacement of ageing equipment. We have carried out iterative renovation and replacement of old-style cooling towers with high water consumption and low operating efficiency, significantly reducing production cooling water loss and operational energy consumption; we have conducted comprehensive inspections and upgrade renewals of ageing public system supporting equipment, addressing the issues of high energy consumption and low resource utilisation of traditional equipment, consolidating the foundation for energy saving and carbon reduction from the hardware perspective, thereby reducing fossil fuel consumption and carbon emission intensity; at the same time, we continue to reduce unit product water consumption through cleaner production upgrades, and ensure compliant emissions through three-waste treatment facilities, effectively reducing environmental risks; in the product research and development phase, we systematically assess the ecological impact and human health risks of product ingredients and exhaust gas, wastewater and solid waste at the production end, prioritising the substitution of high environmental impact raw materials with low-toxicity, low-pollution alternatives; for the end-of-life management of the product life cycle, we have established a systematic disposal mechanism with clear management requirements for the scrapping phase. For recyclable materials, we prioritise resource recovery and recycling; for non-recyclable waste, we hand it over to qualified professional institutions for standardised harmless disposal; for degradable packaging and consumables, we prioritise biodegradation pathways to minimise the environmental impact at the end of the product life cycle. In the future, we will gradually expand the assessment dimensions and further improve the life cycle environmental management system.
Trusting with Heart and Creating a Better Future
Sihuan Pharmaceutical always trusts and cares about all stakeholders, and helps build a better life by implementing responsible measures. In the future, we will always uphold our sincerity, live up to trust, continue to share the high-quality resources and experience accumulated by the Group, fulfill our corporate citizenship responsibilities, and work with all parties to create a better life.
Empowering Talents - Stimulating the Vitality of Talents and Sharing the Development Results
The Group has always adhered to a people-oriented approach, regarding employees as a key force driving the sustainable development of the enterprise. In talent recruitment, we uphold the principles of fair competition and are committed to attracting and developing professional talent. In 2025, the percentage of open positions filled by internal candidates (internal hires) was 7.85%, continuously broadening internal development pathways for employees.
On the basis of safeguarding employees' rights and interests, we have further extended our humanistic care to the broader scope of human rights governance, establishing a human rights due diligence process to identify and assess potential human rights risks. This process covers our own operations, supply chain and partnership relationships, and through regular risk assessments, we develop targeted risk mitigation plans. The human rights risk assessment dimensions cover a range of issues including forced labour, human trafficking, child labour, freedom of association, right to collective bargaining, equal remuneration and discrimination, while also covering vulnerable groups such as employees, women, children, indigenous peoples, migrant workers, third-party employees and local communities. In the event of a human rights-related incident, we will promptly propose improvement plans based on the nature and impact of the incident, provide necessary counselling services and assistance to affected groups, and organise relevant training to strengthen awareness of human rights protection among all parties and prevent similar incidents from recurring.
At the same time, in light of actual operational needs arising from business collaboration, we provide employees with diverse and flexible working hour options. On the premise of ensuring smooth communication during core working hours and uninterrupted business operations, employees who need to adjust their working hours due to personal arrangements or family care responsibilities may do so flexibly upon approval from their department managers. The Company also supports employees in arranging part-time work independently, provided that it does not affect their primary duties and complies with relevant conflict of interest management regulations. In 2025, the employee satisfaction survey target score was 90 points, and the actual achievement was 93 points, fully reflecting the positive impact of these initiatives on the employee experience.
| 2025 Proportion Targets | |
|---|---|
| Women in all management positions, including junior, middle and top management | 40% |
| Women in junior management positions | 40% |
| Women in top management positions | 30% |
| Women in management positions in revenue-generating functions | 30% |
| Women in STEM-related positions | 40% |