Shimao : 2020 Sustainability Report

Shimao Group Holdings Limited

2020

Shimao Group Holdings Limited

Incorporated in the Cayman Islands with limited liability Stock code: 00813.HK

Sustainability Report

Shimao Group Holdings Limited

Sustainability Report

2020

Content

01

City

1. Empowerment of city
2. Energy of city
3. Renovation of city
4. Commerce and Themed Entertainment
5. Services
6. Hotel
7. Technology
8. Education
9. Culture

1. Chairman's message

1. About the Report
2. About the Company
3. Materiality Assessment

1. Sustainability Development Work
2. United Nations Sustainable Development Goals

02

Partner

26 Investor

1. Investor engagement
2. Employee
3. Inclusiveness
4. Employee Development

1. Employee care

1. Care Physical and Psychological Health
2. Occupational Safety

34 User

1. Performance of user service
2. Interaction with users

1. Shimao Smart Community Solutions
2. Privacy protection
3. Supplier

1. Performance of supply chain

1. Supplier Conduct Code
2. Social risk management of supply chain

1. Supply Chain Environmental Risk Management

03

Society

1. Social Responsibility

1. Love homeland
2. Poverty alleviation

1. Charity for children
2. Fighting COVID-19

1. Voluntary services

1. Cultural Responsibility

1. Community Culture

1. Anti-CorruptionResponsibility
2. Anti-fraudsystem
3. Internal whistle-blow mechanism
4. Quality Responsibility

Appendix

68 2020 Awards

1. Certifications of 2020 Green Buildings
2. HKEx ESG Reporting Guide Index
3. Performance Data Summary

04

Environment

58 Green Building

1. Policy of green building
2. Certification of green building

1. Energy Consumption

1. Renewable energy

1. Electricity saving

1. Smart energy management
2. Wate Utilisation

62 Water saving

1. Climate Change
2. Waste Management

1. Resource saving and waste management
2. Clean Air

1. Indoor and outdoor environmental protection mechanism
2. Make the Earth Green

1. Employee involvement
2. Property owner and tenant involvement

Chairman's Message

Chairman's Message

Chairman's Message

Mr. Hui Wing Mau

Founder and Chairman of the Board of Directors of Shimao Group

Thrive to achieve victory

2020 is an unprecedented year. The outbreak of Covid-19 made a tough beginning, but the Chinese people worked together to conquer the pandemic and won the first victory among the countries. We won the victory of walking into well-off society and started the journey of new era.

In 2020, Shimao kept the commitment and connected with country. This year, Shimao immediately responded to fight pandemic, donating money and materials and enhancing the disease control, and in order to won the battle of pandemic with own strength and resource. This year, Shimao rise to the top-8 in the real estate industry with continuous quality and stable growth. This year, embedded gene of "the responsibility is integrated in the blood, while the originality is inherited by hard work", Shimao kept on social development by disclosing consecutively the 5th ESG reporting, promoting green and sustainable development, and fighting for the better life of people.

Stable and quality growth

In 2020, Chinese real estate industry went through deep transformation. During the uncertainties like pandemic, Shimao kept stable growth and earned further achievement -- over 300 billion annual contracted sales, top-8 ranking in the industry, ranking one position higher than 2019 -- the speed of growth leading among the top tier real estate companies. Shimao Group is the model of Chinese real estate companies, achieving "consecutive 4th year quality growth" and creating value for shareholders and society.

Shimao invests in the Guangdong-HongKong-Macao Greater Bay Area ("the Great Bay Area"), Yangtze River Delta Region, Jingjinji Metropolitan Region, and West Coast Straits Economic Zone, works on the strategy of Hainan development, contributes to Chengdu-Chongqing Economic Rim and etc. Committed to "Open and Innovation", Shimao's footprint covers everywhere of China; Shimao conducts a flexible development policy and always makes new happiness to city life with diverse products and services. Shimao kept on investment in the Great Bay Area; as the model work of empowering the Great Bay Area, Shimao Hong Kong-Zhuhai-Macao Port City is piloting the new city hub example, constructing a three-elemental harmony of "City, People, Life"; Shenzhen Longgang Shimao Shenzhen- Hong Kong International Centre is building the "Meeting Room of City", deepening the cooperation among clusters of cities.

In 2020 Shimao Property Holdings Limited was changed to Shimao Group Holdings Limited; the Shimao "Giant Aircraft Strategy" is took off and diverse portfolio of "Sustainable Development Ecosystem" is established. Shimao Services was listed in HKEx and the sector property management went into high-speed development. Shimao Commercial and Themed Entertainment accelerated to move forward in the highway of empowering the "Big Life of City". Shimao Hotel thrived to open Sheraton Hong Kong Tung Chung Hotel and Shimao Yutopia Wuyi Mountain Retreat as scheduled, increasing the market confidence.

Innovative and cooperative beauty

The science and technology changed the future of city, Shimao kept investment on technological sector, integrated intelligence, and expanded the possibilities of life, through cooperation of Ali Cloud, Unisound and others renowned technology companies to introduce smart technology into living products. Smart Community Solutions, Smart Construction, Smart Marketing, Smart Energy Consumption and others digital products empowered better capabilities of service for users and partners of Shimao; as a result, Shimao became the leading digital transformation example in the real estate industry, winning the "The Annual Model" of 2020 "Dingge Award" Chinese Digital Transformation Pioneer Ranking.

To secure the integrity of business environment, Shimao kept on annual anti-corruption survey of the Chinese corporates, initiated "Certification Programme of the certified Anti-Fraud Professional", and promoted innovative mechanism and implementation of anti-fraud and anti- corruption, winning nomination of "Chinese Anti-Corruption Innovation Award".

Organization-empowered and human-centred is the core of corporate culture in Shimao. Shimao conducts comprehensive professional and occupational safety training for directors of board, employees and suppliers; offers competitive compensation and farewell package for employees; provides 24-hour Emergency Assistance Programmes; and improves the Employee Wellness Programme, in order to make employees fully-developed in the platform of Shimao.

Green and sustainable development

Knowing that green ecosystem is the foundation of sustainable city, Shimao heavily invests in green building and steadily increases the area of green building; by the end of 2020, the area of Shimao green building has been 64.636 million sq.m., achieving year-to-year growth of 28%. Meanwhile, Shimao implements green and energy-saving technology, widely upgrades to the energy-saving devices in the communities, and improves to the "Green Communities", promoting the environmental protection ideas and behaviours. With the excellent performance in ESG sectors like "Green Building" and "Corporate Governance", the ESG (Environmental, Social, and Corporate Governance) score of Shimao in MSCI increased from B to BB in 2020.

Securing the safety and quality standards to deliver good products and services, Shimao upgraded to Constructiuon System 5.0 to win the reputation with services, improve management with operational controls, and shape future with innovation and information technology. In addition, Shimao works on the green and safe supply chain and keeps real-time monitor and responses on risks, such as labour compliance, occupational safety risk, environment risk, and material quality risk, in each component of supply chain by periodical review of sustainable performance of suppliers.

Country and social responsibility

With the country and with the people, facing the outbreak and prevalence of Covid-19, Shimao immediately donated HKD 30 million and 1 million masks; staying with Chinese government and Chinese people, Shimao united all business units to support the medical workers and stability of society. In addition, Shimao contributed to "Overseas Chinese Winter Olympics Ice and Snow Museum" by donation of RMB 20 million, actively engaging into the major event of China.

Shimao emphasized on medical support for poverty alleviation, in which the programme of "Prevention and Treatment of Hydatid Disease Diseases in Tibet" has been invested to accumulated RMB 10 million and made 500 Tibetan people benefited, and contributes to poverty alleviation and village prosperity.

In sector of Children philanthropy, "Shimao Rainbow Center" was initiated in Nanjing Children's Hospital to facilitate the hospice care of severely diseased children. By now, "Spectacles Brother" is the leading charity programme in China to care the severely diseased children and operates for consecutive 5 years; in 2020, the programme expanded into "Yangtze River Delta Region" and "Great Bay Area". Currently, the programme has cooperated with 10 large hospitals in China and saved 476 children, lightening the future of severely diseased children whose families are in financial hardship.

As the first comprehensive non-state-owned museum named with "Maritime Silk Road" in China, Fujian Province Shimao Maritime Sea Silk Museum debuted in Quanzhou, marked another start point of Shimao expansion in global culture sector, and set another milestone of Shimao's conservation and inheritance of Chinese culture.

Courage from conquering difficulties and accomplishment from overcoming challenges. For many years, Shimao proactively took corporate social responsibilities, continues improvement of people caring, and served and supported users, employees, and partners. Facing the new era and phase of development, Shimao will keep on improvement of management, enhancement of risk and control management, polishing core capabilities of competitiveness, and deepening sustainability development, to be the leading "Fighter" and "Creator" in the path of becoming centennial company.

04

05

About the Report

About the Report

Content of the report

The report is the 5th sustainability report of Shimao Group Holdings Limited. While the annual report focuses mainly on the Company's business performance and corporate governance, this report, as a complementary material, concentrates on performance in sustainable development and corporate social responsibility, as well as future plans and objectives, including the impacts of Shimao Group's operation on the environment, society, and economy.

Scope of the report

The period of the report is from 1st January, 2020, to 31th December, 2020; the scope of the report comprises headquarters of Shimao Group and Shimao's subsidiaries but excludes companies that Shimao does not hold interest in. The scope of reporting period and entities in the report is the same as that in 2020 annual report of Shimao Group.

Standard of the report

This report is compiled in accordance with the newly revised Environmental, Social and Governance (ESG) Reporting Guide, under Appendix 27 to the Rules Governing the Listing of Securities on the Stock Exchange of Hong Kong Limited.

Access to the report

The report is published in Chinese and English. A soft copy of this report can be downloaded from official site of Shimao Group (www. shimaogroup.hk) and Hong Kong Stock Exchange ("HKEx") (www.hkexnews.hk). Reader would rely on information of Chinese report if there were any discrepancies between Chinese and English.

About the Company

About the Company

About the Company

Shimao Group Holding Limited is an international and comprehensive investment group. After over 30 years of development, the Group has expanded into over 100 core development cities across China, involving property, commerce, property management, hotels, theme entertainment, culture, finance, education, health and high-tech industries, forming a "sustainable development ecosystem" with diversified businesses.

Following the national strategy, Shimao is committed to the vision of "Becoming a Pioneer of the Industry, Build a time-honored Shimao Brand" and continuously provides high-end quality experience for users in residence, life, shopping, business, travelling and other areas, leading life style and serving beautiful life.

Shimao is implementing "Giant Aircraft Strategy", in which body is property development, wings are commercial operation, hotel management, property management and financial service, and empennage is high-tech, health care, education, elder care, culture and other sector, and realises synergies of multiply types of business.

Economic Highlights

On 31th December, 2020, Shimao realised annual contracted sales RMB 300.3billion, representing a year-over-year rate of 15.5%.

TOP 8	RMB	RMB
300.3	17,536
	billion	per sq.m.
Industry Ranking	Total contracted Sales	Average selling price

RMB	29.3%	HKD
135.35	1.8
billion		per share
Total Revenue	Gross margin rate	Annual dividends

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