BANLOONG HOLDINGS LIMITED

Environmental,

Social And

Governance

Report

2019-20

CONTENTS

  1. About the Group
  2. Message from the Board
  3. About this Report
  4. Stakeholders Engagement

7 Environmental Aspects

11 Social Aspects

19 Index to the Environmental, Social and Governance Reporting Guide

2

ABOUT THE GROUP

Ban Loong Holdings Limited ("Ban Loong" or the "Company") is a company incorporated in Bermuda and listed on the Main Board of the Hong Kong Stock Exchange, whose principal activity is investment holding. The operations of the Company and its subsidiaries (collective referred to as the "Group") are divided into two identified business segments, namely the money lending segment and

the trading segment.

Money lending segment

The money lending segment refers to the money lending business engaged in Hong Kong by Ban Loong Finance Company Limited ("Ban Loong Finance"), a wholly-owned subsidiary of the Company which is a licensed money lender in Hong Kong. Its business primarily focuses in the area of short-term personal and corporate loans. To maintain credit control efficiency, Ban Loong Finance does not currently conduct business at retail level. Potential borrowers were sought from the social and business networks of the management and marketing team. To safeguard assets of the Group, the management and credit control team will review and assess the credit risk of each loan application carefully to ensure recoverability of each lending. The Company will continue to take a pragmatic approach in its money lending business to adapt to the market environment and the money supply market and to counteract market challenges from time to time. The management expected the money lending segment will still be one of the major revenue and profit contributors of the Group in the coming years.

Trading segment

The trading segment refers to (i) the trading of goods and commodities in China by Wan Long Xing Ye Commercial Trading (Shenzhen) Limited (萬隆興業商 貿(深圳)有限公司) ("Wan Long Xing Ye"), a wholly- owned subsidiary of the Company and (ii) the trading of goods and commodities in Hong Kong by Wan Long Xing Ye Commercial Trading (Hong Kong) Limited ("Wan Long Xing Ye HK"), a wholly-owned subsidiary of the Company.

The Group has been exploring opportunities to diversify into new businesses. Through the business network of our suppliers and customers of cosmetics and personal care products, the Group became aware of the worldwide trend of the legalization and the consumer use in commercialized scale of cannabidiol ("CBD"), one of the naturally occurring nonpsychoactive cannabinoids found in hemp. As a natural progression from the Group's international trading business of CBD isolate, the Company has accumulated relevant experience and knowledge to enter the whole industry chain of hemp covering the upstream, midstream and downstream production cycles and ranging from cultivation, extraction, mass production, testing, product development of medical and non-medical uses, and the research and development of cultivation and extraction technologies. In order to finance the Company's ongoing expansion and diversification of its business, including diversification and further expansion of the trading segment, by introduction of new products such as hemp and CBD related business as well as the money lending business, the Company entered into a subscription agreement (the "Subscription Agreement") with Yunnan Baiyao Group Co., Ltd ("Yunnan Baiyao Group") in relation to the issue of convertible bonds (the "Convertible Bonds") in the principal amount of HK$730 million (the "Subscription"). Further details of the subscription were set out in the Company's announcements (the "Announcements") dated 14 October 2019, 4 November 2019, 18 November 2019, 2 December 2019, 16 December 2019, 31 December 2019, 31 January 2020, 14 February 2020, 28 February 2020, 31 March 2020, 3 May 2020 and 31 July 2020. As at the date of this report, the Company is in the process of preparing and finalising the circular in respect of the Subscription.

The board of directors (the "Board") has overall responsibility for the Group's environmental, social and governance ("ESG") strategy and reporting. The Board is responsible for evaluating and determining the Group's ESG-related risks and ensuring that appropriate and effective ESG risk management and internal control systems are in place.

Ban Loong Holdings Limited

MESSAGE FROM THE BOARD

3

We believe incorporation of the principle of sustainable development into operation is the key to long-term growth and creation of benefits to

our stakeholders. During the year, while expanding all business segments, we are also actively identifying risks and opportunities in relation to sustainable development, as well as striving to enhance our performance in terms of the environmental, social and corporate governance.

To ensure effective use of resources, the Group has already formulated a set of office guidelines for environmental protection for its staff's reference. By helping the staff form good habits, it is hoped that a culture of energy and resources saving can be fostered.

As trading segment is one of our key businesses, we maintain close connections with our vendors and create a channel to receive feedbacks from them so as to ensure effective management of social and environmental risks within the supply chain. Environmental, social and corporate policies will be taken into account when selecting our vendors to minimise any risk in relation to sustainable development.

The Group has always upheld its system for product liability to establish approaches and measures for handling incident for its staff's reference and execution and monitor the risk in relation to product liability.

The importance of business operations with honesty and integrity is self-evident. As such, we provide trainings to all employees to make sure that they are faithful and self-disciplined. Relevant administrative system has also been set up to eliminate the risk of corruption as far as possible.

It comes to our awareness that there is quite a large room for improvement in Ban Loong's sustainable development. In the near future, we will try our best to understand all the needs and opinions of each of our stakeholders and improve the Group's performance in the environmental, social and corporate governance.

On behalf of the Board

Chow Wang

Deputy Chairman & Chief Executive Officer

Environmental, Social and Governance Report 2019-20

4

ABOUT THIS REPORT

The Group is pleased to present this fourth Environmental, Social and Governance Report (the "ESG Report" or the "Report"). This ESG Report is prepared in accordance with disclosure obligations under the "comply or explain" provisions contained in the "Environmental, Social and Governance Reporting Guide" (the "ESG Guide") as set out in Appendix 27 to the Rules Governing the Listing Securities on The Stock Exchange of Hong Kong Limited (the "Listing Rules"). The purpose is to allow all stakeholders to learn more about the Group's progress and development direction in respect of operation and sustainable development. The Group understands the importance of the ESG report and is committed to making continuous improvements in corporate social responsibility during our course of business in order to better respond to the changing needs of the advancing society. This report is prepared in both Chinese and English and is published on the websites of the Stock Exchange of Hong Kong Limited (the "Stock Exchange") and the Company

(http://www.0030hk.com).

APPLICABLE SCOPE AND REPORTING PERIOD OF THE REPORT

This Report covers the Group's overall environmental, social and governance performance and selected key performance indicators ("KPI") from 1 April 2019 to 31 March 2020 (the "Reporting Period"). A complete index is appended in the last chapter

hereof for reading this Report in accordance with the ESG Guide. The Scope of this report focus on the two identified segments, namely the money lending segment and the trading segment. Mining operation has been disposed in February 2019, as such the mining segment was not included in the scope of this report. To facilitate readers' comparison of the Group's annual performance, the report structure is approximate to the third report. The Group has been continuously improving internal data collection procedures and gradually extending our work relating to the environment, society and governance. We will continue to expand the scope of disclosure until it contains full coverage of all of our operations.

Information relating to the Group's governance section can be found in the Corporate Governance Report on page 21 to 34 as incorporated in the Annual Report 2019/2020.

CONFIRMATION AND APPROVAL

The information contained herein is sourced from official documents and statistics data of the Group, and management and operation information collected in accordance with the Group's systems. The intensity disclosed for the Reporting Period was calculated by dividing the amount of the emission/waste/resources consumption by the Group's revenue of HK$1,162 million during the year ended 31 March 2020. This report was approved by the board of directors on 29 June 2020.

Feedback

OPINIONS AND FEEDBACK FROM STAKEHOLDERS

The Group values the opinions of stakeholders. If you have any question or recommendation about the content or form of reporting of this report, you are welcome to contact the Group through the following methods:

Address: Room 2709-10, 27/F, China Resources Building,

No. 26 Harbour Road, Wanchai, Hong Kong

Email:

info@0030.com.hk

Tel:

(+852) 2549 8222

Fax:

(+852) 2549 3331

Ban Loong Holdings Limited

STAKEHOLDERS ENGAGEMENT

5

Stakeholders' engagement is essential to the formulation of strategies for sustainable development. It allows the Group to understand risks and opportunities. The Group has identified key stakeholders that are important to the Group's business and established various channels for communication.

Stakeholder

Expectation

Engagement channel

Measures

Government

- To comply with laws

- On-site inspections and

- Operated, managed and paid

- Proper tax payment

checks

taxes according to laws and

regulations, strengthened

- Promote regional

- Research and discussion

safety management; accepted

through work conferences,

economic

the government's supervision,

work reports preparation

development and

inspection and evaluation,

and submission for approval

employment

and actively undertook social

- Public information disclosed

responsibilities.

in Stock Exchange website,

such as: annual reports,

interim reports, and

announcements

- Company website

Shareholders

- Return on investment

- Annual general meeting and

- Issued notices of general

and Investors

- Information disclosure

other shareholder meetings

meeting and proposed

resolutions according to

and transparency

- Public information disclosed

regulations, disclosed

- Protection of interests

on Stock Exchange website,

company's information by

such as: annual reports,

and fair treatment of

publishing announcements/

interim reports, and

shareholders

circulars and periodic reports

announcements

- Business risk

in the year. Disclosed company

- Meeting with investors and

management

contact details on website

analysts

and in reports and ensured

- Company website

all communication channels

available and effective.

Employees

- Safeguard rights

- Regular meetings

- Provided a healthy and

and interests of

- Training, seminars and

safe working environment;

employees

developed a fair mechanism for

briefing sessions

promotion.

- Health and safety

- Intranet and emails

- Working environment

- Annual performance

- Career development

appraisal

opportunities

- Self-actualization

Environmental, Social and Governance Report 2019-20

6

STAKEHOLDERS ENGAGEMENT

Stakeholder

Expectation

Engagement channel

Measures

Customers

- Safe and high-quality

- Company website,

- Strengthened quality

products

brochures, interim reports,

management to ensure stable

- Stable relationship

annual reports and

service quality, and entered into

announcements

long-term strategic cooperation

- Information

- Email and customer service

agreements.

transparency

hotline

- Integrity

- Feedback forms

- Business ethics

- Regular meetings

Suppliers/

- Long-term partnership

- Business meetings, supplier

- Invited tenders publicly to

Partners

- Honest cooperation

conferences, phone calls

select the best suppliers

and interviews

and contractors, performed

- Fair and open

- Regular meetings

contracts obligation according

- Information resources

to agreements, enhanced

- Review and assessment

sharing

daily communication, and

- Email, circulars and manual

- Risk reduction

established long-term

- Company website

cooperation with quality

suppliers and contractors.

Horizontal/

- Experience sharing

- Industry conferences

- Stuck to fair play, cooperated

Industry

- Corporations

- Site visit

with horizontal to realize win-

Associations

win results, shared experiences

- Fair competition

and attended different

seminars of the industry so

as to promote sustainable

development of the industry.

Market

- Compliance with the

- Information disclosure

- Complied with regulatory

Regulator

law and regulations

- Reports

requirements in a strict

manner, disclosed and reported

- Information

real information in a timely and

disclosures

accurate manner according to

law.

Public and

- Community

- Voluntary work

- Gave priority to local people

communities

involvement

- Charity and social

seeking jobs from the Company

so as to promote community

- Social responsibilities

investment

building and development;

- Employment

protected the communities'

promotion

ecological environment, and

provided timely compensation

and assistance.

Based on the stakeholder engagement, we have identified issues with significant environmental and social impact and issues concerning stakeholders. The results of materiality assessment prioritised stakeholder inputs and made us focused on the material aspects for actions, achievement and reporting. Through the materiality analysis, the Group identified "use of resources", "protection of customer data and privacy" and "development and training" as issues of high importance, priced the risks and opportunities hidden behind these mater and elaborated more under different sections of this ESG report. We present below the relevant and required disclosure.

Ban Loong Holdings Limited

ENVIRONMENTAL ASPECTS

7

The Group believes that it is the social responsibility of all corporations to ensure that emissions of pollutants and resource consumption are minimised and carbon emissions are reduced. For such purpose, the Group formulates and implements "Environment and natural resources policy", aims to achieve its stated goals by reducing carbon dioxide emissions,

resource consumption and waste production.

A1. Emissions Management

Exhaust Emission

The exhaust emission of the Group mainly derives from the fuels used by vehicles. During the Reporting Period, the Group's vehicles had consumed an aggregate of approximately 36,120 litres of petrol with the driving mileage of approximately 38,500 kilometres in total. Due to the business nature of the Group, employees take public transport to visit customers' companies and vehicles of the Group are used only in special cases. Meanwhile, the Group encourages employees to take public transport whenever possible for meetings or activities and to reduce the use of private cars. For activities at nearer destinations, the Group encourages employees to walk as far as possible instead of taking transportation. The Group will try its best to set up video conferences to allow its employees to conduct remote meetings with various customers at any time.

During the Reporting Period, exhaust emissions were as follows:

KPI A1.1: Exhaust Emission

Amount of

Type of Exhaust

Emissions (kg)

Nitrogen oxides

2.88

Sulphur oxides

0.53

Particulate emissions

0.21

Greenhouse Gas Emissions

Based on the business nature, the Group's main sources of greenhouse gas emissions are direct emissions from vehicles, indirect emissions from electricity consumption for office operation and indirect emissions from employees taking planes for business trips. The Group attaches great importance to adopting the energy saving initiatives as mentioned in the section "Use of Resources", and reduce the impact of these emissions on the environment by monitoring energy consumption and reducing itineraries which require the Group's senior management taking private cars.

Greenhouse gas emissions are partly generated from combusting gasoline by the vehicles owned by the Group . Meanwhile, greenhouse gas emissions are also generated from electricity consumption for the Group's office operation. The Group aims to reduce electricity consumption in daily operation as the amount of indirect greenhouse gas emissions depend on the units of electricity consumed. Specific measures adopted by the Group to reduce electricity consumption are set out in the section headed "Use of Resources - Electricity" of this Report.

D u r i n g t h e R e p o r t i n g P e r i o d , e m p l o y e e s travelled by plane 19 times for business trips. Those trips by plane generated an aggregate of approximately 20 tonnes of carbon dioxide emissions . Employees only take plane for business trips when necessary as the Group pursues the policy of emissions reduction. Under normal circumstances, the Group will arrange for conference calls or video conferences instead of face-to-face meetings to reduce indirect greenhouse gas emissions from transportation.

Environmental, Social and Governance Report 2019-20

8

ENVIRONMENTAL ASPECTS

During the Reporting Period, greenhouse gas emissions were as follows:

KPI A1.2: Greenhouse Gas Emission

Amount

Intensity

(Tonnes of carbon

(Tonnes/Revenue of

Type of Emission

dioxide equivalent)

HK$ million)

Scope 1

- direct emissions

99.49

0.09

Scope 2

- indirect energy emissions

15.55

0.01

Scope 3

- other indirect emissions

20.32

0.02

Total

135.36

0.12

Waste and Wastewater

Due to our business nature, there is no hazardous waste produced during the operation. Major w a s t e s g e n e r a t e d b y t h e G r o u p a r e n o n - hazardous wastes, including office papers, newspapers and other domestic wastes. During the Reporting Period, our Shenzhen Office produced approximately 30 tonnes of non - hazardous wastes in total while Hong Kong office produced approximately 38 tonnes of nonhazardous wastes, all of which were sorted and recycled by qualified contractors.

The Group places high attention to proper disposal of wastes and has clearly set out ways of office waste disposals, including general waste, toner cartridges, wasted paper, computers with related accessories and batteries, in the "Environment Guidelines". It has established a waste sorting system for recycling and contacted contractors to recycle used toner cartridges from time to time to reduce wastes.

The Group is committed to reducing waste production and encourages employees to recycle stationery and reduce waste with an aim to reduce waste production from the source. Moreover, the Group has adopted a digital operation model to centralise the handling of documents and regularly convey environmental protection messages to employees. Permission is also required for printing in the office for statistics and adjustments in respect of paper usage in order to enhance resource utilisation.

No hazardous sewage was generated by the Group during the Reporting Period. As sewage volume depends on water consumption, specific measures have been adopted by the Company to reduce water consumption, details of which are set out in the section headed "Use of Resources

  • Water" of this ESG Report. Besides, sewage generated from the Group is from the daily use of employees, which will be discharged from local water pipelines to sewage treatment plant for treatment.

Ban Loong Holdings Limited

ENVIRONMENTAL ASPECTS

9

A2. Use of Resources

The Group attaches great importance to the effective use of resources and is committed to reducing waste of resources in daily operation. During the Reporting Period, the Group has complied with relevant laws and regulations in relation to the use of energy. The Group has not engaged in the manufacturing business, and no packaging materials were used. Resources used by the Group were mainly electricity, water and paper.

Electricity

The Company acknowledges the importance of energy saving and the fact that reducing electricity consumption will indirectly reduce greenhouse gas emission so the Group has promoted various energy saving strategies. To strengthen each employee's awareness on environmental protection and energy saving, the Group has placed reminders of "For electricity s a v i n g , p l e a s e s w i t c h o f f t h e l i g h t w h e n leaving" at prominent places in the office. The Group encourages employees to set office air conditioner at a moderate temperature and switch them off when they are not in use to reduce electricity consumption.

All electricity consumption by the Group was directly from daily office operation. During the Reporting Period, total electricity consumption of the Group amounted to approximately 17,800 kWh.

Water

The Group has consumed approximately 90 tonnes of water during the Reporting Period. Meanwhile, the Group endeavoured to reduce water usage, for example, promote to and educate employees to save water regularly, place water saving slogans in prominent places and encourage water conservation and report to the property management company to fix dripping taps immediately when the taps are broken. During the Reporting Period, the Group did not encounter any problems in purchasing water sources.

Paper

The Group has implemented environmental protection measures to minimise paper usage at the office. Employees are encouraged to use both sides of paper, and the back of single-sided documents is used for printing or as draft paper. If possible, employees may use the suitable font size and indentation to minimise the pages. Besides, electronic media is recommended for circulation and communication so as to minimise paper usage. During the Reporting Period, the total office paper consumption was approximately 25 kg.

The Group has set up "Office Check List" for Administration Department to monitor and ensure the measures for resources saving were fully implemented by the staff. The measures for water and energy saving, as well as paper and materials recycling are included in the check list. Managers shall propose specific remedial measures for non- compliance matters.

Environmental, Social and Governance Report 2019-20

10

ENVIRONMENTAL ASPECTS

Energy

  • Turn on the power saver mode on electrical equipment
  • Turn off unnecessary electrical equipment
  • Set the air conditions at room temperature
    (25.5°C)

Water

  • Reuse sewage on green irrigation

A3. tHe Environment and Natural Resources

The operations of the Group do not involve soil pollution, land erosion or biodiversity conservation. Given the impact of edible palm oil on the ecological environment, the trading business of the Group has expanded to other finished edible oil products to alleviate the impact on the environment.

  • Report and arrange maintenance for leaking of faucet or water pipe in a timely manner

Paper

  • Encourage communication via electronic means
  • Use environmental-friendly paper for printing

Other supplies

  • Reuse delivery materials
  • Use supplementary cleansing products
  • Handle and store materials in a proper manner to avoid waste
  • Use environmental-friendly cutlery

During the Reporting Period, total resource consumption was as follows:

Intensity

(Unit/

Revenue of

Use of Resources

Amount

HK$ million)

KPI A2.1 - Electricity

17,800

15.32

consumption (kWh)

KPI A2.2 - Water

90

0.08

consumption (Tonnes)

Paper consumption (kg)

25

0.02

The Group understands the importance of the environment and natural resources. The Group is committed to developing a sustainable environment. It emphasises the importance of preventing the pollution of natural resources, such as rivers, air and land, in the "Code of Conduct for Staff", and the use of biodegradable or non- phosphorus detergents is required under the "Environment Guidelines" to reduce negative impact on the environment.

The Group complies with national and regional laws and regulations such as the Environmental Protection Law of the People's Republic of C h i n a ( 中華人民共和國環境保護法) a n d t h e Regulations of the Shenzhen Special Economic Zone on Environmental Protection (深圳經濟特 區環境保護條例). During the Reporting Period, the Group did not identify any noncompliance of laws or regulations in relation to emissions or environment.

T h e G r o u p w i l l c o n t i n u e t o i m p l e m e n t environment-friendly practices in the Group's operation in order to enhance environmental sustainability.

The Group will keep recording its resource consumption for reviewing effectiveness of its conservation measures in the future and formulating more specific improvement measures and objectives.

Ban Loong Holdings Limited

SOCIAL ASPECTS

11

Employment and Labour Practices

The Group regards employees as the cornerstone of its corporate operation and development. Therefore, the Group attaches great importance to the training and welfare of employees and is committed to providing a working environment with job satisfaction. The Group provides competitive remuneration and sound promotion opportunities to facilitate career development of employees. Meanwhile, the Group has adopted a series of policy measures relating to employment system, occupational safety and health, trainings as well as labour standards, with a view to achieving win-win situation between employees and employers.

During the Reporting Period, the Group strictly complied with labour legislations and related regulations in the People's Republic of China ("PRC") and Hong Kong. The Group was not involved in any violation relating to labour practices during the Reporting Period and would have a significant impact on the Group.

B1. Employees

The Group aims to attract and retain talents, ensures a safe and equal working environment for employees, provides development opportunities and promotes employees' health and wellbeing. The Group has formulated the staff manual according to relevant labour regulations, covering t h e G r o u p ' s r e m u n e r a t i o n a n d d i s m i s s a l , recruitment and promotion, working hours, statutory holidays, social security, and standards of other rights and benefits. The Group complies with the laws and regulations in relation to employment and equal opportunities such as the Labour Law of the People's Republic of China (中 華人民共和國勞動法), the Labour Contract (Law of the People's Republic of China (中華人民共和 國勞動合同法), Law on the Protection of Persons with Disabilities (殘疾人保障法), the Employment Promotion Law (就業促進法) and, Regulations on the Wage Payment to Employees of Shenzhen ( 深圳市員工工資支付條例) a n d E m p l o y m e n t Ordinance of Hong Kong.

As at 31 March 2020, the Group had a total of 29 employees.

Talent Recruitment and Retention

Employees are the core assets to maintain corporate competitiveness, and the key to corporate success. The Group provides a fair and impartial talent selection system and continuously improves the system to recruit talents. The Group has formulated an annual recruitment plan and filled job vacancies based on the principle of "internal staffs superior to external candidates" in order to offer internal promotion and redesignation opportunities to existing employees. The Group recruits external candidates through the Company's website, recruitment website, job market, newspapers and media, headhunting companies and employee's referral. The Group ensures that the recruitment and promotion processes are fair, open and transparent, and selects candidates depending on objective factors such as candidates' working experience, skills, academic background, communication skills, personal qualities.

The Group adheres to the principle of employing talents with both ability and moral integrity, and regards morality, knowledge, ability and performance as the main evaluation criteria, so as to put talents at suitable positions and retain talents. The Group has formulated a set of staff performance appraisal mechanism, in which appropriate remuneration adjustment is made annually based on staff performance to reduce talent loss.

Environmental, Social and Governance Report 2019-20

12

SOCIAL ASPECTS

Remuneration and Benefits

We offer reasonable and competitive salary and benefits to staff. Employees are awarded salary rise and promotion based on their job performance, as well as regular results and performance appraisal. We make timely contribution to social insurances (i.e., pension, medical insurance, unemployment insurance, maternity insurance, and occupational injury insurance) and the housing fund ( 五 險 一 金 ), mandatory provident fund and labour insurance in strict accordance with the Social Security Law of the People's Republic of China, the Labour Law of the People's Republic of China, the Mandatory Provident Fund Schemes Ordinance (Cap. 485 of the Laws of Hong Kong) and the Employees' Compensation Ordinance (Cap. 282 of the Laws of Hong Kong). Apart from basic statutory holidays, wedding and funeral leave, maternity leave, work-related injury leave, annual leave, family planning leave and paternity leave, employees are also entitled to other staff benefits including luncheon and transportation allowances. These benefits boost employees' sense of belonging to the Company, create good working atmosphere and enhance corporate cohesion.

Equal Opportunity and Diversity

As a diversified enterprise, the Group strives to create a fair, diversified and harmonious working environment for employees and protect them from discrimination and harassment. The Group formulates employment policies in strict accordance with the Labour Law of the People's Republic of China and the Labour Contract Law of the People's Republic of China and provides equal opportunities in respect of recruitment, training, promotion, job transfer, remuneration, benefits, and termination of contracts. These equal employment opportunities are not affected by age, gender, physical conditions, marital status, family status, race, color, nationality, religion, political connection or sexual orientation. The Group formulates policies addressing "Promotion, Equal Opportunities, Diversity and Antidiscrimination" to make sure every staff being treated fairly in terms of recruitment process, remuneration and benefits, training opportunities, working arrangement, promotion and disciplinary punishment.

The Group also values female employees' career development and ensures that they have equal promotion opportunities as male employees. The Group also complies with the requirements under the Law of the People's Republic of China on the Protection of Women's Rights and Interests (中華 人民共和國婦女權益保障法). Female employees' employment contracts will not be released or terminated during their pregnancy, maternity leave and breastfeeding period and they are entitled to basic salaries.

Dismissal Policy

With regards to the policies relating to dismissal of employees, if an employee has committed serious misconduct and fails to improve in spite of repeated warnings, his/her supervisor and the senior management of the Company will have a thorough internal discussion and allow the employee to answer and explain before the dismissal is announced. The reasons for the dismissal will be conveyed to the employee clearly. The dismissal procedure must be in accordance with applicable laws and regulations as well.

Staff Communication

We appreciate the significance of communication with and care for our employees. We believe that maintaining a close relationship with our staff allows us to better understand their needs. Besides, orientation with introduction of corporate system, culture and other information would be conveyed to employee when they are on board. The Group has also established a mechanism to handle the advise and complaints from staff.

Working Hours and Rest Periods

The Group has formulated its policy based on local labour laws including the Provisions of the State Council on Employees' Working Hours ("國務院 關於職工工作時間的規定") to determine working hours and rest periods for employees. The Group would compensate those who work overtime with extra pay or additional days off.

Ban Loong Holdings Limited

SOCIAL ASPECTS

13

B2. Health and Safety

The Group attaches high attention to the health and welfare of each and every employee. The Group has established and implemented a "Health and Safety System", striving to build a healthy and safe working environment for our employees.

During the Reporting Period, there was no accident of work-related injuries/fatalities and no lost days due to work injury recorded by the Group. The Group has no violation of the laws and regulations regarding the provision of safe working environment during the Reporting Period.

Due to our business nature, the operation of the Group mainly involves clerical work and no position has been identified as having high safety risks. However, the Group understands that our staff spend most of the time on computer work, therefore we plan to enhance education in relation to office health and safety for employees, such as promoting safety use of office equipment and correct working postures, or organize workshops for workplace stretching exercises to reduce the possibility of injury and occupational diseases.

Following the outbreak of coronavirus disease in early 2020, a series of precautionary measures have been adopted by the Group, including the work-from-home arrangements and heightening of hygiene and epidemic prevention in office.

The Group sponsors the occupational health examination before, after and during their induction for early detection of latent illness and timely medical treatments. Besides, for any staff suffering from infectious diseases, the Group will timely allow sick leaves for him/her to receive proper medical treatment and arrange segregation of relevant departments as well as vaccination for staff who have insufficient antibodies. First aid kits are also available in Shenzhen Office and labour protective equipment satisfying the national safety and health standards are also provided. In order to ensure the employee's awareness of occupational safety, all newcomers must receive safety training to identify, reduce or eliminate occupational risks.

B3. Development and Training

The Group values the continuous development of staff and strives to enable our staff to grow alongside with the Group . The Group has formulated and implemented a "Development and Training System" for a comprehensive training system, which sets out the administrative duties of the officers of training teams under each department and the related policies, and provides corresponding learning and training courses for employees, thus allowing continuous updating of job knowledge and skills of employees.

In addition to the internal trainings delivered by external lecturers and the inspections and assessments afterwards, such as the finance and taxation training courses by the Finance D e p a r t m e n t t o u p d a t e t h e k n o w l e d g e o f finance and taxation regulations, the Group also encourages and provides subsidies to employees to participate training courses held by other institutions in a compensated way, so as to enhance job-required knowledge and enrich their skills. Besides, the "Code of Conducts for Staff" sets out training and development policies for newcomers, including the arrangements and contents of trainings, in order to help them quickly learn about job-required knowledge and adapt to the working environment.

Environmental, Social and Governance Report 2019-20

14

SOCIAL ASPECTS

Trainings have covered a variety of topics in order to cater the needs for employees from different departments. The number of trainees and training hours are as follows:

Number of

employees

Training

Employees training

trained

Hours

Senior management

4

18

Administrative staff

2

12

I n o r d e r t o e v a l u a t e e m p l o y e e s ' w o r k i n g performance and potential in an efficient way, The Group has established and implemented the "Employee Promotion Policy", so as to set up a fair and comprehensive competition and promotion mechanism as well as to motivate our staff to enhance their working quality and capability. Staff can apply for internal transfer within the Group according to their own personal development needs.

B4. Labour Standards

The Group strictly complies with complies with the Labour Law of the People's Republic of China, the Labour Contract Law of the People's Republic of China, Employment Ordinance of Hong Kong and other relevant labour laws and regulations in Hong Kong and PRC. The Group tolerates no child labour or forced and compulsory labour, allows no employment of child labour or forced and compulsory labour which are prohibited by international standards and relevant regulations. Before employment, new employees shall show their ID cards to avoid child labour. In the event that there is any mistakenly-hired child labour, the Group will immediately suspend his/her work, inform his/her parents or legal guardians and return him/her to his/her residence, and bear all the costs incurred.

The Group bans the employment of forced labour in any ways and ensure all job duties are in compliance with labour contracts. It is clearly stated in the labour contracts that employees have the right to refuse any dangerous work a r r a n g e m e n t . O u r s t a f f c a n i m m e d i a t e l y terminate the labor contract and obtain economic compensations if they are forced to perform such job duties by means of violence, threats or illegal restrictions on personal freedom. The Group will never force employees to work overtime. The Group would compensate those who work overtime with extra pay or additional days off. If labour disputes are found, employees can seek for mediation by the labour union or labour dispute mediation committee of the Group and they can also apply for arbitration with Labour Dispute Arbitration Committee directly.

During the Reporting Period, the Group was not aware of any non-compliance regarding child labour, forced or compulsory labour in its operation.

Upholding Employee Rights

The Group is committed to protecting human rights, and has established a respectful, honest and fair working environment for employees and customers and complied all relevant laws and regulations. Laws and regulations related to employment and labour which would have significant impacts on the Group include the Labour Law of the People's Republic of China, the Labour Contract Law of the People's Republic of China and the Employment Ordinance of Hong Kong. There was no significant violation by the Group during the Reporting Period.

Operational Practices

The Group believes that the best operational practices are keys to the realisation of sustainable development and long-term corporate growth. Our qualities of integrity, honesty and fairness have also been reflected in the Code of Business Conduct, Employee Code of Conduct, supply chain management, environmental protection practices and product assurance.

Ban Loong Holdings Limited

SOCIAL ASPECTS

15

B5. Supply Chain Management

B6. Product Responsibility

The Group believes that establishing sustainable supply chain and facilitating interaction and communication with suppliers and banks could improve confidence of customers and other stakeholders on the Group . Therefore, the Group only maintains long-term cooperative relationships with logistics and banks with good creditworthiness, sound goodwill, quality products and services, good track record and eligibility. Focusing on establishing close cooperation relationships with suppliers, the Group has been working together with them to reduce impacts on the environment from production processes while ensuring the quality of service to customers. The Group has formulated written policies and guidance "Supplier Selection Policy" and takes the environmental, social and governance policies into consideration when managing suppliers. The Group will cease cooperation with suppliers which fail to meet its requirements. During the Reporting Period, there was no supplier which failed to meet such requirements.

Supplier Management Measures of the Group include the following:

S u p p l i e r s ' e n v i r o n m e n t a l , s o c i a l a n d

governance policies, including emissions,

u s e o f r e s o u r c e s , e n v i r o n m e n t a l a n d

natural resources, health and safety, staff

development and training, the prevention of

child labour, product responsibility and anti-

corruption

  • To deploy dedicated staff to work on-site in the office of the individual large suppliers to conduct continuous quality inspection
  • To conduct unscheduled quality inspection
  • To protect product supply and reduce risks through decentralized procurement

• T o f o r m u l a t e a c c e p t a n c e c r i t e r i a a n d procedures, which are detailed in the procurement contract, for each type of products

Providing efficient and high-quality services to customers have always been the utmost concern for the Group. The Group's objective is that customers have confidence in our services and they are provided with sufficient information to make informed choices. To improve service quality of the Group, the Company conducts site visits and regular visits in order to have indepth understanding on actual demands and development targets of customers. By establishing long-term and good cooperation with customers, the Company has efficiently supported the economic development in the regions of operation and indirectly facilitated employment in those regions . Meanwhile, the Group has proactively acquired customer feedbacks, including feedbacks from site visits and feedbacks by phone. Therefore, the Group has a set of policies and procedures in place to monitor and control quality, so as to ensure customers' opinions are efficiently collected and handled.

Except for the pre-market product selection and supply chain management, the Group also formulates and implements the "Product Liability System". This system classifies after- market incidents which jeopardize public health and safety by its actual condition into ordinary, material and serious rankings. Based on the rankings, the responsible officers of the Group of each functional departments at various levels are required to respond timely so as to mitigate the hazards and risks to the social communities.

Environmental, Social and Governance Report 2019-20

16

SOCIAL ASPECTS

Rankings of

Allocation of

product liability incidents

responsibility by positions

To be handled under the authorization and instruction of accounting

Ordinary

officer

Material

To be handled jointly by accounting officer and general manager

Serious

To be handled by joint team formed by directors and legal person of

the Group and insurance company

Quality Management

The Group cares about the health and safety of customers, so performance of product liability in all aspects is of vital importance. As to edible oil, the Group would examine Business License, Food Business License (食品經營許可證) and Food Circulation License (食品流通許可證) of refined oil suppliers and raw material manufacturers as well as the food inspection report from Quality Supervision of Food Inspection Station (Dongguan) in Guangdong Province when selecting supply goods in order to safeguard the health of customers and the public and to ensure food safety. During the Reporting Period, all of the edible oil of the Group has passed the inspection.

As to trading products, when adding labels on products, the Group follows "GB 7718 - 2011 General Standards for the Labelling of Prepackaged Foods" (GB 7718-2011食品安全國家 標準:預包裝食品標籤通則).

In the coming year, the Group will formulate labelling management guidelines and relevant policies regarding customers' privacy to safeguard customers' information, and improve the product labelling monitoring measures.

The Group did not involve in any advertising- related matters during the Reporting Period.

T h e G r o u p c o m p l i e s w i t h t h e p r o v i s i o n s concerning product liability as set out under Product Quality Law of the People's Republic o f C h i n a ( 中華人民共和國產品質量法) a n d Administrative Regulations of Shenzhen Special Economic Zone on Product Quality (深圳經濟特區 產品質量管理條例) and other laws and regulations. During the Reporting Period, the Group had not identified any non-compliance of laws and regulations in relation to product liability (including customers' health, safety, advertising, labelling and customers' privacy-related matters). The Group had not received any complaint in relation to product or service and had not identified any case in relation to leakage, theft or loss of customers' information.

Ban Loong Holdings Limited

SOCIAL ASPECTS

17

Protection of Customer Data and Privacy

The Group handles significant amount of personal data and credit information of customers. The Group upholds a belief that information security and privacy are key principles for operation. The Group's employees are required to sign a confidentiality agreement acknowledging receipt and agreement of their responsibility and obligation regarding the protection and non-disclosure of customer data. In addition, information can only be used in authorised business activities. Employees disclosing such information to other parties is considered as data theft. Related employees shall bear corresponding responsibility.

During the Reporting Period, there were no noted case of violation of relevant laws or regulations regarding product responsibility.

B7. Anti-corruption

The Group is committed to upholding ethics and integrity during the operation process. No form of corruption or bribery is tolerated. Sound judgements for transactions with customers, suppliers, contractors, job seekers, colleagues or any other third party should be ensured. All applicable laws and regulations shall be duly complied with so as to always maintain the highest standard of integrity.

The Group has formulated and implemented a "Policy of Integrity Management (廉政管理制

)", under which it not only strengthens the governance of its staff teams but also requires employees to learn and enforce regulations in relation to integrity and self-discipline of leading cadres announced by Central Commission for Discipline Inspection of the Communist Party of China and the Rules of Integrity (廉政準則), and to strictly comply with relevant laws and regulations. In addition, this system also prohibits staffs from accepting any expensive offerings such as monetary gift, credit card and cash voucher, etc. Furthermore, the "Code of Conducts for Staff" of the Group also sets forth the basic principles of anti-corruption, and states that employees should make appropriate adjustment in terms of benefits, for example, employees are not supposed to make any personal gain through the exercise of their official duties or they are supposed to avoid arousing suspicion and report to relevant authorities when dealing with business involving in their relatives' benefits in accordance with regulations.

Environmental, Social and Governance Report 2019-20

18

SOCIAL ASPECTS

During the Reporting Period, the Group rigidly abided by the Anti-Money Laundering Law of the People's Republic of China (中華人民共和國反洗 錢法), China's Efforts to Combat Corruption and Build a Clean Government (中國的反腐敗和廉政建 設), Anti-bribery Management Systems (反賄賂管 理體系) and other laws and regulations in respect of anti-corruption, bribery, extortion, fraud and money laundering. Reference to the aforesaid laws and regulations, the Company has developed the "Anti-Money Laundering Policy", which provided that staff of the business department shall learn potential customers' background completely through consulting documentation and communicating with customers according to relevant internal guidance before commencing business dealings with them. The Company's risk management department also collects information of current customers in respect of uses of proceeds, sources of repayment funding and operational conditions. The risk management department also acquires their latest information from time to time and report to the senior management once abnormal situation is identified.

Pursuant to the Code of Conducts for Staff, employees may question suspected misconduct or misconduct orally or in writing. The Group will make every effort to treat all reports in a strictly confidential way. The identity of the reporting and complaining employee is not allowed to be disclosed without his/her consent, unless the Group is legally obliged to disclose the employee's identity and other information. In case of suspected corruption or other criminal offences, the Group will report to the applicable departments.

The Group has always strictly complied with relevant laws and regulations . During the Reporting Period, the Group had not identified any case of non-compliance of laws and regulations in relation to bribery, blackmail, fraud and money laundry nor received any relevant report.

B8. Community Investment

The Group deeply realised the importance of returning to the society and spared no effort in providing help to community. The Group strongly encouraged its staff to participate in community activities and contribute to the sustainable development of the harmonious society.

Looking forward, the Group will continue to focus on community care and staff development with an aim to improve the society through participation in the community.

Ban Loong Holdings Limited

INDEXTOTHE ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORTING GUIDE

19

SUBJECT AREAS, ASPECTS, GENERAL DISCLOSURES AND KPIs

SECTION

PAGE

ENVIRONMENTAL

Aspect A1: Emissions

General

Information on:

"Emissions"

7-8

Disclosure

(a) the policies; and

(b) compliance with relevant laws and regulations that

have a significant impact on the issuer,

relating to air and greenhouse gas emissions, discharges

into water and land, and generation of hazardous and

non-hazardous waste.

KPI A1.1

The types of emissions and respective emissions data.

"Emissions"

7

KPI A1.2

Greenhouse gas emissions in total (in tonnes) and,

"Emissions"

8

where appropriate, intensity (e.g. per unit of production

volume, per facility).

KPI A1.3

Total hazardous waste produced (in tonnes) and, where

"Emissions"

N/A

appropriate, intensity (e.g. per unit of production volume,

per facility).

KPI A1.4

Total non-hazardous waste produced (in tonnes) and,

"Emissions"

8

where appropriate, intensity (e.g. per unit of production

volume, per facility).

KPI A1.5

Description of measures to mitigate emissions and

"Emissions"

7-10

results achieved.

and "Use of

Resources"

KPI A1.6

Description of how hazardous and non-hazardous wastes

"Emissions"

8

are handled, reduction initiatives and results achieved.

Aspect A2: Use of Resources

General

Policies on the efficient use of resources, including

"Use of

9-10

Disclosure

energy, water and other raw materials.

Resources"

KPI A2.1

Direct and/or indirect energy consumption by type (e.g.

"Use of

10

electricity, gas or oil) in total (kWh in '000s) and intensity

Resources"

(e.g. per unit of production volume, per facility).

KPI A2.2

Water consumption in total and intensity (e.g. per unit of

"Use of

10

production volume, per facility).

Resources"

KPI A2.3

Description of energy use efficiency initiatives and

"Use of

9-10

results achieved.

Resources"

KPI A2.4

Description of whether there is any issue in sourcing

"Use of

9

water that is fit for purpose, water efficiency initiatives

Resources"

and results achieved.

KPI A2.5

Total packaging material used for finished products (in

"Use of

N/A

tonnes) and, if applicable, with reference to per unit

Resources"

produced.

Environmental, Social and Governance Report 2019-20

20 INDEXTOTHE ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORTING GUIDE

SUBJECT AREAS, ASPECTS, GENERAL DISCLOSURES AND KPIs

SECTION

PAGE

Aspect A3: The Environment and Natural Resources

General

Policies on minimising the issuer's significant impact on

"The

10

Disclosure

the environment and natural resources.

Environment

and Natural

Resources"

KPI A3.1

Description of the significant impacts of activities on the

"Emissions"

10

environment and natural resources and the actions taken

and "Use of

to manage them.

Resources"

Social (Note 1)

Employment and Labour Practices

Aspect B1: Employment

General

Information on:

"Employment"

11-12

Disclosure

(a) the policies; and

(b) compliance with relevant laws and regulations that

have a significant impact on the issuer,

relating to compensation and dismissal, recruitment

and promotion, working hours, rest periods, equal

opportunity, diversity, anti-discrimination and other

benefits and welfare.

KPI B1.1

Total workforce by gender, employment type, age group

"Employment"

N/A

and geographical region.

KPI B1.2

Employee turnover rate by gender, age group and

"Employment"

N/A

geographical region.

Aspect B2: Health and Safety

General

Information on:

"Health and

13

Disclosure

(a) the policies; and

Safety"

(b) compliance with relevant laws and regulations that

have a significant impact on the issuer,

relating to providing a safe working environment and

protecting employees from occupational hazards.

KPI B2.1

Number and rate of work-related fatalities.

"Health and

N/A

Safety"

KPI B2.2

Lost days due to work injury.

"Health and

N/A

Safety"

KPI B2.3

Description of occupational health and safety measures

"Health and

13

adopted, how they are implemented and monitored.

Safety"

Ban Loong Holdings Limited

INDEXTOTHE ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORTING GUIDE

21

SUBJECT AREAS, ASPECTS, GENERAL DISCLOSURES AND KPIs

SECTION

PAGE

Aspect B3: Development and Training

General

Policies on improving employees' knowledge and skills

"Development

13-14

Disclosure

for discharging duties at work. Description of training

and Training"

activities.

KPI B3.1

The percentage of employees trained by gender and

"Development

N/A

employee category (e.g. senior management, middle

and Training"

management).

KPI B3.2

The average training hours completed per employee by

"Development

N/A

gender and employee category.

and Training"

Aspect B4: Labour Standards

General

Information on:

"Labour

14

Disclosure

(a) the policies; and

Standards"

(b) compliance with relevant laws and regulations that

have a significant impact on the issuer,

relating to preventing child and forced labour.

KPI B4.1

Description of measures to review employment

"Labour

14

practices to avoid child and forced labour.

Standards"

KPI B4.2

Description of steps taken to eliminate such practices

"Labour

14

when discovered.

Standards"

Operating Practices

Aspect B5: Supply Chain Management

General

Policies on managing environmental and social risks of

"Supply Chain

15

Disclosure

the supply chain.

Management"

KPI B5.1

Number of suppliers by geographical region.

"Supply Chain

N/A

Management"

KPI B5.2

Description of practices relating to engaging suppliers,

"Supply Chain

N/A

number of suppliers where the practices are being

Management"

implemented, how they are implemented and

monitored.

Aspect B6: Product Responsibility

General Disclosure

KPI B6.1

Information on:

"Product

15-17

(a) the policies; and

Responsibility"

  1. compliance with relevant laws and regulations that have a significant impact on the issuer,

relating to health and safety, advertising, labeling and privacy matters relating to products and services provided and methods of redress.

Percentage of total products sold or shipped subject to

"Product

N/A

recalls for safety and health reasons.

Responsibility"

Environmental, Social and Governance Report 2019-20

22 INDEXTOTHE ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORTING GUIDE

SUBJECT AREAS, ASPECTS, GENERAL DISCLOSURES AND KPIs

SECTION

PAGE

KPI B6.2

Number of products and service related complaints

"Product

N/A

received and how they are dealt with.

Responsibility"

KPI B6.3

Description of practices relating to observing and

"Product

N/A

protecting intellectual property rights.

Responsibility"

KPI B6.4

Description of quality assurance process and recall

"Product

16

procedures.

Responsibility"

KPI B6.5

Description of consumer data protection and privacy

"Product

17

policies, how they are implemented and monitored.

Responsibility"

Aspect B7: Anti-corruption

General

Information on:

"Anti-

17-18

Disclosure

(a) the policies; and

Corruption"

(b) compliance with relevant laws and regulations that

have a significant impact on the issuer,

relating to bribery, extortion, fraud and money

laundering.

KPI B7.1

Number of concluded legal cases regarding corrupt

"Anti-

N/A

practices brought against the issuer or its employees

Corruption"

during the reporting period and the outcomes of the

cases.

KPI B7.2

Description of preventive measures and whistle-blowing

"Anti-

17-18

procedures, how they are implemented and monitored.

Corruption"

Community

Aspect B8: Community Investment

General

Policies on community engagement to understand the

"Community

18

Disclosure

needs of the communities where the issuer operates

Investment"

and to ensure its activities take into consideration the

communities' interests.

KPI B8.1

Focus areas of contribution (e.g. education,

"Community

N/A

environmental concerns, labour needs, health, culture,

Investment"

sport).

KPI B8.2

Resources contributed (e.g. money or time) to the focus

"Community

N/A

area.

Investment"

Note:

1. Pursuant to Appendix 27 of the Listing Rules, KPIs in this section are recommended disclosures only.

Ban Loong Holdings Limited

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Ban Loong Holdings Ltd. published this content on 15 September 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 15 September 2020 10:24:01 UTC