SuStainability RepoRt 2014 - chemchina.com.cn · RepoRt 2014 Su S tainability Repo R t ... The report is published in both Chinese and English. If any inconsistency or discrepancy

SuStainability RepoRt 2014

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年可持续发展报告

中国化工集团公司

ABOUT THE REPORTThis is the fifth sustainability report published by China National Chemical Corporation (“ChemChina”). The report discloses information about the social responsibility commitments, practices and performance in 2014 of ChemChina on topics such as the business management, technical innovation, occupational safety, environmental performance, employee care and social harmony.

Normative References

The report is based on the Guideline on CSR Fulfillment by Central Enterprises issued by the State-owned Assets Supervision and Administration Commission of the State Council (SASAC), the Ten Principles of the United Nations Global Compact , the Sustainability Reporting Guidelines of the Global Reporting Initiative (GRI G3.1), the ISO 26000: Guidance on Social Responsibility (2010) issued by the International Organization for Standardization, and the CSR Reporting Guidelines for Chinese Companies (CASS-CSR 2.0) issued by the Chinese Academy of Social Sciences (CASS-CSR2.0).

Scope of Report

The report covers ChemChina’s activities from 1 January to 31 December 2014. In some instances content and information from outside the stated period may be included. The report covers ChemChina headquarters and its subordinate units.

Data Sources

All data used in this report comes from official documents and statistical reports of ChemChina.

References to ChemChina

Unless otherwise stated, all references to “ChemChina”, “Group”, “Company” or “We” refer to China National Chemical Corporation.

Report Improvements

Demonstrate green chemical progress to respond the revised Environmental Protection Law;

Show key index to highlight good performance;

Use charts, diagrams and tips, etc. to promote readability.

Report Language

The report is published in both Chinese and English. If any inconsistency or discrepancy exists between the two versions the Chinese version shall prevail.

Obtain the Report

To view or download the report, please visit the official website of ChemChina at www.chemchina.com.cn.

The report is printed on recycled paper.

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CONTENTS

FOCUS / 16GREEN CHEMICAL INDUSTRY – NEW OPPORTUNITY OF

LEADING THE DEVELOPMENT OF CHEMICAL INDUSTRY

PROSPECTS FOR THE FUTURE / 62

EXPERT COMMENTS / 64GRI INDEX / 66FEEDBACK FORM / 71

MESSAGE FROM OUR CHAIRMAN / 02

CHEMICALS HELPS ACHIEVE THE CHINESE DREAM / 04

ABOUT US / 06

STRATEGY AND GOVERNANCE / 10

SOCIAL RESPONSIBILITY MANAGEMENT / 12

GOOD BUSINESS PERFORMANCE FOR THE CREATION OF NEW VALUE / 20

DRIVING NEW GROWTH THROUGH TECHNICAL INNOVATION / 28

SETTING A NEW BENCHMARK FOR PRODUCTION SAFETY / 38

GREEN AND ENVIRONMENTAL, EXPANDING THE NEW SPACE / 44

EMPLOYEE GROWTH, CREATING NEW BUSINESS OPPORTUNITIES / 48

SOCIAL HARMONIES AND SHARING THE NEW ACHIEVEMENT / 56

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Nowadays, social responsibility fulfillment has become an important means taken by an enterprise to address changes of complex internal and external environments, maintain growth and stability and enhance the market competitiveness and risk-resistance capability. Integrating CSR into its development objectives and operating principles, ChemChina propels partners to fulfill responsibility, and devotes to promoting sustainable development of the chemical industry on the basis of achieving win-win results.

In 2014, global economy experienced sluggish growth with weaker-than-expected recovery, while China’s economy was featured by the three period superimposed (a period with the growth slowing down, the structural adjustment progressing with difficulties and effects of early stimulus policies being digested gradually), increased economic downward pressure, and overcapacity and scant demand of most chemical products. On the basis of conscientiously implementing the decisions and deployments of the CPC Central Committee and the State Council and resolutions of the State-owned Assets Supervision and Administration Commission of the State Council (SASAC), and adhering to the general principle of seeking improvement in stability, we achieved fast growth in production and operation by deepening reforms, promoting structural adjustment, accelerating marketing changes and carrying out all work well, while overcoming all difficulties in high spirits.

Giving advantages into full play, and developing diversified servicesWe vigorously promoted marketing services, deepened application of modern marketing tools, and enhanced management over client information and product prices. We advanced construction of direct sales system, distribution system and e-commerce system, innovated models, broadened channels, updated means, segmented customers, conducted pilot implementation of Chief Commercial Officer System, and held the marketing contest themed by “achieving good start by 100 days’ hard work”. We made breakthroughs in E-commerce service, launched more than 600 kinds of products and services, and achieved the E- sales of RMB17.5 billion, and an increase of 2,343 customers.

MESSAGE FROM OUR CHAIRMAN

In 2014, on the basis of conscientiously implementing the decisions and deployments of the CPC Central Committee and the State Council and resolutions of the SASAC, and adhering to the general principle of seeking improvement in stability, we achieved fast growth in production and operation by deepening reforms, promoting structural adjustment, accelerating marketing changes and carrying out all work well, while overcoming all difficulties in high spirits.

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Adjusting structures and optimizing the allocation of resourcesWe promoted transfer of quality resources to major businesses, optimization and reorganization of professional sectors, and gradually gave up the businesses which are non-core and lack competitiveness. We drove the diversification of property rights, and attracted foreign investment of RMB14.6 billion. We won the “Best Organization Award” for central enterprises in equity transaction for 4 consecutive years. We optimized product structures, and vigorously developed hi-tech & high value-added products. We promoted the reform of collectively owned factories operated by state-owned enterprises, and “water supply, power supply, heat supply and property management” separation. We cleaned up 23 enterprises below level 3, and recovered the long-term equity investment of RMB120 million.

Optimizing management, digging potentials, reducing costs and increasing efficiencyWe consolidated financial basis, optimized capital management, constantly improved quality and efficiency of final accounting, and were rated as the advanced unit of annual final accounts by the Ministry of Finance. Our report was audited to be standard with unqualified opinion for 8 consecutive years. We carried out benchmarking activities, made up for management weakness, and vigorously promoted lean management mainly through continuous improvement/world-class manufacturing. We strengthened supplier management and centralized purchase of coal, crude oil, calcium carbide, natural rubber and steel, optimized logistics distribution, and continuously reduced procurement costs. By promoting the in-depth integration of business and information, and deepening application of collaborative office and ERP systems in the fields of production and operation, human resources and financial management, we continuously enhanced management & operation efficiency.

Strengthening platform construction and enhancing innovation capabilityWe strengthened dominant role of innovation, promoted the construction of innovation platforms, and continued to increase investment in science and technology. We constantly improved the system of scientific and technological innovation. Owning 123 R&D institutes of various kinds, including 28 ones of national level, the Group won the “National Science and Technology Advancement Award for Engineering Enterprises Excellent in Technology Innovation” by SASAC. We launched 813 scientific research projects of various kinds, including 168 state key projects. With 741 filed patents and 743 authorized patents, we ranked top 5 among the central enterprises in four consecutive years.

Improving the SHE system and realizing energy conservation and emission reductionWe deepened the SHE management system construction, revised the SHE Performance Assessment Measures, and increased the intensity of rewards and punishment. We formulated the Five-year Plan for Production Safety and the Assembly of Accident Cases of the Group, carried out

safety checks, and rectified 21,090 items, with the rate of 95.7%. We carried out various safety publicity and education activities themed by family safety, organized employees’ family members to visit our factories, and held the “family affection meetings” to build the culture of family safety. We researched and developed green and environment-friendly products, and promoted low carbon development of the chemical industry.

Assuming civic responsibility and promoting social harmonyWe continuously improved the supplier management system, enhanced suppliers’ ability to assume responsibility, and attentively cared for employees to enhance their happiness sense. We actively promoted the communication between the Chinese and foreign employees, and the organic integration of Chinese and Western cultures. We safeguarded the openness and transparency of donations, and tried to create a social atmosphere of mutual help.

2015 is a critical year for deepening reforms comprehensively. We will center on improving quality and effectiveness, and focus on effective incentive constraint mechanism to promote the transformation and upgrading of ChemChina to a new height. We will accelerate economic restructuring, and constantly improve the“3+1” business portfolio that centers on material, life and environmental sciences and basic chemical engineering. We will improve level of internationalized business operation, strengthen the cooperation between enterprises at home and abroad, enhance global resource allocation, and strive to become a world-class enterprise with international competitiveness. We will promote the construction of science & technology innovation platform, establish the innovative system of industry-university-research cooperation, and improve the supporting capacity of science and technology for the “3+1” strategy. We will strengthen energy conservation and emission reduction, and quality energy management, and complete the energy-saving and emission-reduction goals as stipulated in the 12th Five-Year Plan, so as to lay a solid foundation for establishing a globally leading position.

We sincerely accept the supervision from all walks of life, willing to work with you for sustainable and healthy development of ChemChina!

Chairman:

Chemicals are used as raw materials in the production of cotton fiber, artificial fiber and synthetic fiber, and in various dye stuffs and printing and dyeing auxiliaries in the textile industry.

Tanning agents, leather fatliquoring agents, dyestuffs, coating agents and other auxiliaries are used in the tanner industry to shorten the leather production cycle, simplify the process, and reduce costs.

Food additives and chemicals for food storage and packaging purposes are provided to broaden food choices.

“Malan noodles” provides the common people with a nutritious, uniquely tasting, convenient and fast-food chain.

Plastics, coatings, sealing agents, adhesives, waterproof mater ia ls , concrete addit ives and other new building materials are used to improve housing conditions.

Provide chemical materials for the production of automobiles, ships and airplanes. Four kinds of high-molecule materials are used in the auto industry, i.e., plastics, rubber, adhesive, and coating to reduce the weight and fuel consumption of vehicles and increase speed.

Provide asphalt additives, concrete admixtures and other chemicals for the transportation construction. China Auto Care provides convenient and efficient services of vehicle maintenance and repair, and

automotive components manufacturing.

CHEMICALS HELPS ACHIEVE THE CHINESE DREAMHuman beings cannot be without clothing, food, housing and transportation, and these things cannot be without materials. Of these materials, some exist in nature, while even more are artificially synthesized with chemical processes, e.g., fertilizers, pesticides, plastics, synthetic rubbers, synthetic fibres, etc. They are of all shapes and colors and are ubiquitous. They have transformed the original form of production technology and transportation, improved people’s living conditions, and made our material lives even more rich and colorful. Chemical products have not only provided convenience to people’s lives, but even more, they have promoted the development of the national defense industry and related industries, as well as science and technology, and have greatly raised national economic benefit and regional economic benefit.

CREATE A BETTER LIFE

CLOTHING

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Chemicals are used in the production of chemical fertilizers and pesticides to increase both crop output and farmer’s income, helping ensure sufficient food for humans.

Raw materials such as plastics, rubber and coatings are used in the manufacturing of household appliances.

Chemical materials such as plastics and special-purpose chemicals are used in the manufacturing of many components in the machinery industry.

Equipment, materials, specialty chemicals and assaying and testing technologies are used in modern biotechnology.

New materials, technology and equipment support the environmental industry.

Supply chemical additives, mining explosives and other necessary chemical products for the coal industry and the mining industry.

Provide antioxidant, anti-corrosive additives and other chemical catalysts for the catalytic refinement of crude oil.

Chemicals such as caustic soda and chlorine gas are used in paper-making industry.

A total of 16,250 kinds of electronic chemicals covering 18 categories are used in the electronics industry. These include base materials, photoresist, cleaning agents and solvents, ultra-clean high-purity agents, ultra-clean high-purity gas and metal organic compounds and encapsulating materials.

Chemical materials and processing technologies are used in hardware that enables data acquisition, transmission, storage, processing and displays in the IT industry.

Develop innovative products for the medical industry, and provide solutions for various applications and designs.

Various basic and high-performance chemical materials including high temperature and pressure-resistant materials as well as cryogenically processed new materials are used by the national defense industry.

Auxiliary products are provided to the Shenzhou series of airships, the Tiangong Program, Chang’e lunar exploration satellites and large-type passenger planes, etc.

PROMOTING INDUSTRIAL UPGRADING

SUPPORTING NATIONAL DEFENSE CONSTRUCTION

High technology and new materials enable the development of new sources o f energy such as so lar energy , biomass energy, maritime energy, geothermal energy and wind power.

Prov ide the te lecommunicat ions i n d u s t r y w i t h c h e m i c a l s f r o m communication cables and optical cables to telephones and mobile phone casing.

Company Profile

Headquartered in Beijing, ChemChina is a large-sized state-owned enterprise formed out of enterprises affiliated to the former Ministry of Chemical Industry. As the largest enterprise in China’s chemical industry, ChemChina operates six business units covering advanced chemical materials and special chemicals, basic chemicals, oil processing, agrochemicals, tire & rubber products and chemical equipment.

ChemChina, a national innovation-oriented enterprise, operates production and R&D facilities in 140 countries and a comprehensive marketing network system. We have six strategic business units (SBUs), two directly affiliated units, 112 production and operation enterprises, six overseas enterprises, 24 research institutes and design academies, and control nine A-share listed companies. In 2014, we ranked the 276th on the global top 500, up from 355th in 2013. Our business income was RMB254.5 billion with RMB274.2 billion in total assets.

We uphold our commitments to creating a better life through the use of chemicals. We act responsibly, advocate responsible care, and serve people’s material interests through our chemical products, and lead the industry in the adoption of high technology to become a top-notch chemical company in the world.

ABOUT US

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Agrochemicals

Chemical equipment

Advanced chemical materials and

special chemicals

Oil processing and

refinery products

Rubber products

Basic chemicals

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New chemical materials and

specialty chemicals

• Own production and development facilities for dozens of high-tech and high-value-added products such as silicone, fluororubber, methionine, metallurgical-process solar-grade polysilicon

• World’s second largest methionine producer

• The world’s third largest silicone producer

• Asia’s largest PBT resin producer• China’s largest producer of fluororubber,

neoprene and epoxy resin

Agrochemicals

• Including herbicides, pesticides, bacter ic ides and plant growth regulators, capable of producing more than 120 varieties of original m e d i c i n e a n d m o r e t h a n 8 0 0 preparations—with nearly 5,000 registered products and more than 6,000 trademarks in 120 countries worldwide

• The world’s largest non-patented agrochemical manufacturer

• Ranks first in China in terms of market share of products such as dichlorvos, dipterex, pymetrozine, ethephon, uprofezin, endosulfan emulsion, dimethyl tetrachloro sodium, 1-Nitrotoluene and toluidines

Basic chemicals

• Low-cost , recycl ing and c lean production of chlorine and alkali plants

• The largest producer of caustic soda and PVC in China

• The world’s third largest and Asia’s largest PVC paste resin manufacturer

Rubber products

• Control and operate tyre, rubber p r o d u c t s a n d l a t e x p r o d u c t s manufacturers that produce a variety of high-tech and high-value-added products such as tyres, polysulfide rubber, specialty rubber products and new-process charcoal black

• The combined production capacity of all-steel radial tyre, semi-steel radial tyre, aviation tyre and giant engineering tyre ranks in the top three in the Chinese tyre industry

• Rank second in China in terms of belt and tubing products such as high-strength conveying belt and braking tube

• Ranks first in medical glove and meteorological balloon productions in China

Petrochemical and refinery

products

• C o m b i n e d a n n u a l c r u d e o i l processing capacity of 25 million tons, and use an oil-to-chemical technological line

• Own the first 500,000 tons per year DCC plant and the first 500,000 tons per year CPP plant in China

Chemical equipment

• C h e m C h i n a e n j o y s t e c h n i c a l superiority in the chemical machinery manufacturing field and owns the only ion membrane caustic soda plant production technology in China

• The world’s third largest rubber machinery manufacturer

• Our Yixiangji series is the best-selling Chinese-made rubber machinery in the international marketplace

• ChemChina ion membrane caustic soda plant ranks third in the world in terms of output and sales volume, and has 70% domestic market share

Business unit Business overview Position in the industry

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Key Performance Matrix

Indicator Unit 2014 2013 2012

Economic performance

Total assets RMB100 million 2,742 2,936 2,674

Business income RMB100 million 2,545 2,440 2,017

Technology

R&D spending RMB100 million 38.83 41.50 40.66

R&D spending as a percentage of business

income % 1.62 1.80 2.14

Number of patents granted 743 605 692

Number of invention patents granted 398 250 364

Safety

Mortality per 1000 % 0.04 0.08 0.05

Spending on occupational safety RMB10,000 48,900 53,700 72,450

Environment

Comprehensive energy consumption per

RMB10,000 output

Tons of standard

coal per RMB10,000 1.05 1.09 1.18

Total volume of effluent discharge 10,000 tons 10,270.01 10,502.11 10,799.08

COD emissions tons 12,168.35 12,462.46 12,804.34

Employee

Staff 119,838 125,002 133,121

Percentage of female staff % 28 29 27

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1. VISION AND VALUES

Our vision

T o b e c o m e a w o r l d - c l a s s , resource-efficient, environmentally fr iendly, and intrinsically safe chemical company that creates economic and social value.

Core values

Creating value for shareholders and jobs for the wider society.

STRATEGY AND GOVERNANCE

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New science and new future

2. STRATEGIC OBJECTIVES

We will re-define our “new science and new future” strategic position and build a business portfol io that centers on material, life and environmental sciences for its future business success but is strategically supported by basic chemicals.

We quickened our transformation and our approach to business g r o w t h b y a d d i n g f o u r c o r e capac i t ies : bus iness port fo l io o p t i m i z a t i o n , w o r l d - c l a s s m a n u f a c t u r i n g , i n v e s t m e n t and project management, and m a r k e t i n g a n d a p p l i c a t i o n development. We achieved this by optimizing our capital structure, o u r b u s i n e s s s t r u c t u r e , o u r organizational structure and our human resources structure.

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4. CORPORATE GOVERNANCE

We have adopted the board system that is in accordance with the provisions of the Company Law of the People’s Republic of China and other applicable Chinese laws and regulations. The board of directors is the highest power and decision-making body, which is responsible for the assets management activities of the Group, exercises their rights in accordance with the provisions of the Company Law and SASAC. The board of directors sets up special committees such as the strategy and investment committee, the nomination committee, the remuneration and appraisal committee and the audit and risk management committee, etc. SASAC fulfills its duties as a promoter on behalf of the central government, and the State Council maintains a board of supervisors for major state-owned enterprises at ChemChina. The board supervises the company’s corporate value and ensures the appreciation of state-owned assets in accordance with the Interim Regulation on Board of Supervisors of State-owned Enterprises.

3. ORGANIZATIONAL STRUCTURE

Administrative Office (office of the Party Committee)

Office of Production & Operation (Safety and Environmental Department)

Personnel Department (Organization Department of Party Committee)

Finance Department

Planning and Development Department

Supervision Department (Disciplinary Inspection Committee Office)

PR Department (Propaganda Department of the Party Committee)

Management & Information Department

Science and Technology Department

Commerce Department

China National Chemical Corporation

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In its day to day operations, ChemChina abides by moral codes as well as laws and regulations, enhancing its level of transparency, respecting and responding to the concerns and expectations of stakeholders. It undertakes responsibility towards its effect on the economy, society and the environment, encouraging the harmonious mutual benefit of the country, enterprises, employees, society and the environment.

1. GOVERNANCE OF RESPONSIBILITY

ChemChina attaches importance to and actively promotes social responsibility work. It has established a Social Responsibility Promotion Work committee with the general manager as the first person responsible. It is responsible for the overall leadership and harmonization work during the social responsibility promotion process of the group company. The committee has set up an office beneath it, it is managed by production and management of the group company and is made up from the planning department and related staff. The Social Responsibility Promotion Work Office is responsible for routine work such as setting up systems related to social responsibility promotion work, organizing social responsibility work training, and compiling and issuing reports concerning annual sustainable development for the group company.

SOCIAL RESPONSIBILITY MANAGEMENT

ChemChina’s corporate social responsibility organization chart

Production and Management Office

Planning Department

Social Responsibility

Work Committee

Social Responsibility Work Office

2. CSR AWARD

In “The Seventh International Conference on CSR Reporting in China” sponsored by China WTO Tribune, “ChemChina Sustainability Report 2013” won “GoldenBee 2014 Excellent CSR Reports – Leading Enterprise” award.

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3. STAKEHOLDERS AND KEY ISSUES

Stakeholder Common objective Main communication channel Our effort

SASAC

• Maintain and increase the value of national assets

• Technological innovation guides industry development

• Safe production, energy conservation and emission reduction

• Bring employment to promote social harmony

• Regular work reports• Participation in corresponding

meetings• Submitting information

• Promoting strategic transformation and marketing reform

• Increasing science and technology innovation system construction

• Improving the HSE management system, promoting “zero emissions” management

Clients

• High quality goods and services• Abide by commercial ethics• Satisfy diverse demands

• Visiting clients• Contractual agreements

• Promoting scientific and technological innovation, accelerating the building of private brands

• Providing products that concord with technological standards of environmental protection

Employee

• Reasonable salary and welfare• Training and development of

professional career• Good work environment

• Labor union activities• Workers’ congress meetings

• Linking salary with achievement• Capability and quality

assessments and performance feedback

• Establishment of corporate culture

Government

• Compliance with the law• Drive regional employment and

economic development

• Paying taxes according to law• Participating in government

investigations and surveys and signed cooperation agreements

• Promoting the combatting of corruption and upholding integrity

• Communicating actively with various government departments

Suppliers/cooperative

partners/those in the same industry

• Fair competition• Encourage industry progress

• Industry conferences and forums

• Transparent Procurement• Scientific and technological

innovation

Environment

• Energy conservation and emission reductions

• Green development

• Maintaining contact with environmental protection administration and social organizations

• Learning and exchanging green production technology

• Reasonable use of resources• “Zero emissions” management• Environmentally friendly work

Community

• Devotion to public welfare• Serving community development

• Chemical Industry Museum of China

• BlueStar Summer Camp• Community volunteer events

• Promoting local employment• Promoting cultural fusion• Working for the public good

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4. RESPONSIBILITY MATRIX

Good business performance for the

creation of new value

Driving new growth through technical

innovation

Setting a new benchmark for

production safety

ChemChina

• Persisting with “3+1” business portfolio

• Continuous improvement of management levels

• Internationalized operations

• Building innovative platforms for science and technology

• Building science and technology innovation teams

• Promoting application of science and technology innovation results

• Optimizing HSE system construction

• Strengthening trouble shooting

• Strengthening of emergency management

• Strengthening management of dangerous chemicals

Advanced chemical materials and special chemicals

• Actively expand business overseas

• Launch Integrated Product Development (IPD) system construction

• Strengthen safety production inspection and standard work specification management

Basic chemicals

• Carry out sustainable improvement work for all staff and processes

• Resource integration, promotion of construction of scientific and technological platform

• General survey of whole system’s basic safety work

Oil processing and refinery products

• Strengthen DCS application optimization

• Pursue “client-manager management mode”

• Strongly implement technical innovation and management project

• Strengthen safe production cost management

Agrochemicals • Establish digital “wisdom factory”

• Open up public WeChat platform for “Jiangsu Anpon Electrochemical Co., Ltd”

• “Kind safety message”

Rubber products

• Whole value chain management

• Protect intellectual property rights

• Construct national level enterprise technology center

• Launch safety and troubleshooting assessment

Chemical equipment

• Accelerate marketing integration

• Accelerate integration of scientific and technological innovations

• Safe management network construction

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Green and environmental, expanding

the new space

Employee growth, creating new business

opportunities

Sharing new results in a

harmonious society

• Promote “zero emissions” management

• Strongly encourage energy conservation and emission reduction

• Research and develop environmental protection technology

• Guarantee basic rights and interests for employees

• Encourage vocational education• Promote integration of CDM results• Create a harmonious corporate culture

• Implement “going out” and “attracting in” strategies

• Improve supplier management mechanism

• Encourage cultural fusion in various aspects

• Systematically promote process optimization, raise general efficiency

• Increase attraction of occupational managers

• Improve supply chain management

• Strengthen energy efficiency management

• Promoting careers of employee, planned projects

• Strengthen fixed-point poverty alleviation

• Release “Work Post Responsibility for SHE Oil and Gas Company”

• Promote performance management system construction

• Promote cooperation between enterprises and banks

• Strive to conserve resources• Strengthen employee assistance

mechanisms• Assistance for poor areas

• Cleaner production• Raise resource utilization efficiency

• Enrichen spiritual and cultural lives of female workers

• Actively participate in charitable donations

• Lower greenhouse gas emissions • Actively recruit fresh graduates • Promote supplier responsibility

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FOCUS

GREEN CHEMICAL INDUSTRY – NEW OPPORTUNITY OF LEADING THE DEVELOPMENT OF CHEMICAL INDUSTRY

Chemical engineering and chemicals are no source of pollution, but the technology source for curing pollution and an effective means for resource conservation. They are also an important safeguard for building ecological civilization and a beautiful China.

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Case: Zhonghao Chenguang Research Institute of Chemical Industry

built a “green factory”

Zhonghao Chenguang Research Institute of Chemical Industry actively conducts front-end control and source control. We invested nearly RMB100 million in equipping 20 sets of environmental protection devices including fluorooctanoic acid recovery units, plasma incinerators, and bio-processing units. We established environmental protection branches through integration, and actively advanced the plasma incineration project with annual processing capacity of 2,000 tons on principles of front-end comprehensive utilization supplemented by end processing, which substantially enhanced the capability to dispose “three wastes (industrial waste water, waste gas and residues)”. We launched the project of perfluorooctanoic acid recovery with new technology to comprehensively recycle from source, which could save more than RMB10 million a year after operation.

In cooperation with Landscape Planning and Design Research Institute of Southwest University, we renovated the landscape in the production base to build good production environment and working environment. The renovated production base has a total of more than 800 trees, more than 320 strains of shrubs, 2,262 m2 of ground cover plants, and 15,308 m2 of lawn. Without dirty, disorderly and bad situation of production sites of traditional chemical enterprises, the new base shows a new image of “green, healthy and pleasant garden-like factory”.

Zhou Shengxian, Minister of Environmental Protection, noted at the 2015 National Work Conference on Environmental Protection that the economic and social development of China had entered a new normality under which the growth rate changes from high speed to intermediate-high speed, the economic structure transforms from medium-low end to medium-high end and the development momentum shifts from factor-driven and investment-driven to innovation-driven. Under the new normality of economic development, some new phase characteristics and tendency changes have shown in the fields of ecological civilization construction and environmental protection. Environmental protection is not only faced with new opportunities, but also confronted with new challenges.

ChemChina strictly abides by the environmental laws and regulations, sticks to “zero mission” concept, fulfilling low carbon and recycled production theory to lead the development of green industry. We invest a lot in development of new technologies to reduce chemical pollution and realize clean production, and also actively promote environmental technologies, and provide innovative and environmental services, to change wastes into treasure and continuously create economic and social values.

INTEGRATION OF ENVIRONMENTAL PROTECTION CONCEPT IN PRODUCTION

Some by-products are often generated during manufacturing of chemical products, thus causing negative impacts on the environment. We always adhere to the “zero emission” concept, actively explore the “cyclic utilization, clean production” road, conduct optimal integration during production, and strictly control pollution from source. We advocate source reduction, reuse and recycling of wastes, reduction of waste emission and toxicity, as well as adverse impact of product life cycle on environment, and change of chemical pollution governance from treatment after pollution to governance from source.

Deeply Understand and Actively Adapt to the New Normality of Ecological Civilization Construction and Environmental Protection

GuidelinesCoordination of the relationship

between environment and economyConstraint from resources and

environment

Insist on protection and prevention first; pay more attention to strict prevention from source, strict management of the process as well as strict punishment in case of any consequence. Give top priority to protection and form a joint force for comprehensive anti-pollution and ecological protection.

Emphasize “the coordination between economic and social development and environmental protection”; more conscientiously promote green development, cyclic development and low-carbon development; realize economic development and people’s wel l -be ing improvement whi le protecting the environment.

Clearly realize the urgency and difficulty in protecting ecological environment and controlling environmental pollution; strictly observe the red line of ecological protection and let the overdrawn resource and environment recuperate and build up strength gradually; increase the ecological product supply and environmental capacity.

Fluorooctanoic acid recovery units

Plasma incinerators

Bio-processing units

Invested nearly RMB100 million in equipping 20 sets of environmental protection devices

Front-end comprehensive utilization

Supplemented by end processing

Actively advanced the plasma incineration project with annual processing capacity of 2,000 tons· Enhanced the capability to dispose three wastes (industrial waste water, waste gas and residues)· Launched the source recycled project· Saved more than RMB10 million a year

Front-end control Source control

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ENVIRONMENTAL SERVICE INNOVATION

For us, environmental factors play a central role in development of new products. To win customers’ recognition, quality products must have good environmental compatibility. We closely combine economic benefits and environmental protection in development and innovation of technologies, and promote environmental technologies through rich expertise.

Case: BlueStar Water Treatment

Technology Company participated

in construction of “Bird’s Nest”

Design of Bird’s Nest (National Stadium) maximizes the use of water resources, and 70% of its water supply is recycled water, of which nearly one third is rainwater. As the constructor of central rainwater processing room, BlueStar Water Treatment Technology Company designed the steps of triple purification (sand filtration, ultrafiltration, and nanofiltration) on the basis of comprehensively considering safety elements and overcoming space restrictions, to address water quality fluctuations, meet various environmental conditions, and achieve the compliance after treatment. Relying on the best design, meticulous construction, and rigorous testing, we smoothly completed the water supply tasks during the Olympic Games.

Case: Southwest Research and Design Institute of the Chemical Industry

made civil natural gas with coke oven exhaust

Coke oven gas is one of the main by-products of the coking industry. About 400 cubic meters of coke-oven gas would be generated to smelt 1 ton of coke. If coke-oven gas is not processed properly, enormous ecological and safety dangers will come into being. Southwest Research and Design Institute of the Chemical Industry developed the leading patented technology of coke oven gas purification and methanation, which can help make synthetic natural gas with the methane concentration of more than 88%, by turning coke oven gas into methane through purification, compressing and heat transfer first, and then separating hydrogen from the mixed gas through the gas separation technology. The technology achieved the zero emission of wastes, and has been applied in the industrial unit of Shanxi Guoxin Zhengtai Energy Development Co., Ltd. with the capacity of making synthetic natural gas (SNG) with 240 million Nm3/a coke oven gas after methanation. The project can achieve annual emission reduction of 240 million cubic meters of coke oven gas, 200,000 tons of carbon dioxide, 120 tons of sulfur dioxide, and 10 tons of dust. With the capacity to generate synthetic natural gas of 100 million cubic meters annually and replace coal of 1.46 million tons, the project can achieve clean production of coking industry and increase the added value of coke oven gas and coal tar products. In addition, it is of great significance to promote energy conservation and emission reduction and substitute energy.

70% of the water supply

is recycled water, of

which nearly one third is

rainwater

Coke oven gas is one of the main by-products of the coking industry

1 ton of coke 400 cubic meters of coke-oven gas

Purification

Methanation

Southwest Institute patented technology

Becoming m

ethane through purification, com

pressing and heat transfer

Gas separation technology

Natural gasMethane

Separating hydrogen from the mixed gas

20

GOOD BUSINESS PERFORMANCE FOR THE CREATION OF NEW VALUE

On the basis of seeking improvement in stability, ChemChina, through adjustment, optimization and upgrading of industrial structure, expands major businesses, promotes transformation of development mode, and constantly enhances comprehensive value creation ability and core competitiveness.

1,860Achieved profit RMB1,860 million

276Ranked 276th on the global top 500

254.5Business income RMB254.5 billion

21

GOOD BUSINESS PERFORMANCE FOR THE CREATION OF NEW

VALUE

1. OPTIMIZING OUR INDUSTRY MIX

In accordance with the 12th Five-Year Plan, we continued to promote transfer of quality resources to major businesses, o p t i m i z a t i o n a n d r e o r g a n i z a t i o n o f professional sectors, and gradually gave up the businesses which are non-core and lack competitiveness, and further advanced the “3+1” pattern.

Typical initiatives

We continued to promote the adjustment and optimization of six business sectors, and deployed the development strategy for chemical new materials, specialty chemicals, agrochemicals, basic chemicals and technology sectors. We analyzed and studied the challenges to the industries of polysilicon, polyformaldehyde and carbon fiber, and explored the industry integration and restructuring. Adama consolidated domestic agricultural assets by merger, and built preparation bases to strengthen its global industry position. Academy of Sciences and China Haohua Chemical Group Co., Ltd. merged and formed technology sector of ChemChina, made clear development positions and optimized the allocation of resources.

2. OPERATIONAL RISK PREVENTION AND CONTROL

We strengthened prevention and control of operational risks, deepened efficiency supervision, advanced audit rectification, gradually establ ished the long-term mechanism of legal system, and gave play to the synergistic effect of discipline inspection, supervision, auditing and laws.

Legal Risk Control

With major risk prevention as the core, and risk management information system as a platform, we comprehensively conducted risk management and internal control. We formulated the legal audit management measures for economic contracts, rules and regulations, and major decisions, and promoted informatization of risk management. The rate of legal audits over the three aspects has reached up to 100%.

Typical initiatives

We established the system of three levels of risk internal control organizations, formulated policies and standards, and updated the risk database. We completed the Comprehensive Risk Management Report and the Internal Control Evaluation Report. We defined internal control responsibilities and work procedures, established the weekly meeting system and briefing system for the project group, and the mechanism of communicating with and reporting to PMO. We completed site surveys of 25 enterprises, put forward 345 suggestions for improvement, and conducted risk management training of enterprises in Shandong province for one time. The Group reviewed 122 contracts throughout the year, participated in special studies of contracts related to important projects, and put forward legal advice. We solved any dispute between enterprises across the system through mediation, and avoided legal proceedings.

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22

Typical initiatives

The Group signed 22 letters of responsibility for party conduct and integrity, and letters of commitment on honest practicing with main party and administration leaders of specialized companies and units directly governed by the Group; specialized companies concluded 1,084 letters of responsibility for party conduct and integrity, and 2,441 letters of commitment on honest practicing with the leadership members and key position personnel of subordinate enterprises. We carried out special governance to eliminate the behaviors such as leaders’ purchase of various consumer cards with public funds, and extravagant and excessive purchase of books.

Disciplinary Inspection

We promoted improving Party conduct, combating corruption and upholding integrity, strengthened supervision on exercise of power over key links and positions including human, financial and material resources, intensified efforts to punish corruption behaviors, and enhanced the honest education, to create an environment of honest, high-quality and efficient enterprise development.

Supervision and Inspection

By deepening efficiency supervision, formulating and improving 116 systems and approving 162 projects, we avoided economic losses of RMB14.8 million, saved money of RMB77.92 million, and directly increased economic benefits of RMB39.06 million. We strictly investigated and dealt with 4 matters in violation of rules and disciplines, restoring the economic losses of RMB4.25 million. We established the system of reporting the disciplinary inspection and petition situation on a monthly basis, and the system of receiving petitioners in turn, and accepted 88 petition reports.

Typical initiatives

Typical initiatives

We focused on the combination of the discipline inspection and petition cases since the incorporation of the Group, thoroughly cleared up 429 clues, registered and created a ledger, laying a good foundation for specifying cases. Conducted efficiency supervision with specialized companies and reported 6 projects to the Supervision Bureau of SASAC for filing. We held 6 site promotion meetings in specialized companies and some level-3 enterprises. We examined and verified the qualification of 315 suppliers within the project management scope of the Group.

We supervised specialized companies and subordinate enterprises in conducting self-inspection that covered 130 audit projects in the last five years, and reflected 1,305 problems. Group Headquarters launched 57 audit projects throughout the year (31 economic responsibility audit projects, 18 construction audit projects, and 8 special audit projects), involving an amount of RMB176.5 billion, and proposing 336 audit suggestions.

Audit

We sorted out the internal audit procedures, defined audit purviews, established and implemented the long-term supervision system, and urged enterprises to rectify through self-inspection and joint inspection by the Group and specialized companies, so as to improve auditing efficiency.

39.06Avoided economic losses of RMB14.8 million, saved money of RMB77.92 million, and directly increased economic benefits of RMB39.06 million

4.25Investigated and dealt with 4 matters in violation of rules and disciplines, restoring the economic losses of RMB4.25 million

23


VALUE

Typical initiatives

We cultivated 1,600 yellow belt personnel and 90 green bel t personnel, with the belt personnel coverage of 12.46%. We strengthened management of belt personnel and projects, established the internal expert database of the Group for continuous improvement, and completed review of 154 black belt and green belt projects. Total benefits of projects reached RMB127 million. We s t rengthened cont inuous improvement of scientific research institutes and small-sized enterprises, organized discrete industries and research institutes across the system to learn the experience of Nanjing 7425 on continuous improvement, and integrated it into the continuous improvement concept. We analyzed favorable factors and improvement opportunities of the Group with McKinsey 7S model and SWOT matrix, and defined work objectives, work ideas, assessment indexes and job contents according to preliminary investigation results.

3. IMPROVING OUR MANAGEMENT PERFORMANCE

We executed the requirements of SASAC of the State Council on enhancing management, conducted management reform and informationization construction, conscientiously summed up and deeply analyzed experience gained and lessons drawn, further benchmarked world-class standards, and established the long-term mechanism for management improvement, to achieve the standardized, systematic and scientific improvement of management level.

3.1 Continuous Improvement

We deeply promoted continuous improvement/world-class manufacturing, and improved key indicators and management level through benchmarking international best practices, finding weaknesses and using the methods of six sigma and lean production, which play an important role in cost reduction, efficiency increase, energy conservation and emission reduction, and quality improvement.

Case: Nanjing 7425 Rubber & Plastic Co., Ltd. won the title of “Excellent Enterprise in Continuous Improvement” by the Group

In 2013, Nanjing 7425 systematically analyzed and reasonably classified various problems of production, operating and management through lean production and world-class manufacturing, and gave play to the role of continuous improvement in cost reduction and efficiency increase, and debottlenecking by taking the measures including talent training, continuous improvement, concept establishment and culture building. In addition, Nanjing 7425 promoted the shift of enterprise production to full-process management, and achieved the calculable earnings of up to RMB2 million. It won the title of “Excellent Enterprise in Continuous Improvement” by the Group in 2013, following other 7 branches of the Group.

Typical initiatives

We normalized fixed asset investment, and made investment and construction separated from production and management. We strengthened process management, and established a project termination mechanism and a mechanism of early warning in case of exceeding budget and duration, to control project risks in a timely manner. After checking and solving the problems concerning project investment, decision-making and review, we revised the Development Strategy and Planning Management Measures of China National Chemical Corporation, the Administrative Provisions on Engineering Construction Supervision (interim), and the Management Measures for Investment in Fixed Assets and distributed to subordinate units for execution.

3.2 Cost Reductions and Efficiency Increases

Centering on cost reductions and efficiency increase, we tried to improve production efficiency by strengthening investment management, standardizing production budget management, improving cost accounting, and conducting centralized purchasing management.

Improving Investment Management Practices

Starting from improvement of investment decision-making process, we further controlled new investment projects, comprehensively combed existing problems, defined business plans and feasibility assessment contents, and made process standardized, content specific and execution normalized. Relying on the third-party agencies, we strengthened product market argument and analysis and improved scientificity of decision-making.

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Reducing Non-Productive Costs

We optimized the financing structure, strengthened centralized management of funds, and reduced use of account receivable occupying funds and inventory occupying funds, as well as unproductive expenditures, to improve fund use efficiency and promote internal potential digging, cost reductions and efficiency increase.

Typical initiatives

We saved financial costs of RMB52.975 million by controlling credit scale, broadening direct financing channels and reducing the proportion of high interest-bearing debts. ChemChina Petrochemical Co., Ltd. benchmarked advanced industry enterprises, reduced the processing losses from 1.07% to 0.87%, and the comprehensive energy consumption from 71.52 kg standard oil/ton to 63.80 kg standard oil/ton, and saved costs of RMB402 million. Dezhou Shihua Chemical Co., Ltd. PVC product per ton consumed 1.346 tons of calcium carbide, reaching the excellent level, and achieved a profit of RMB50 million, an increase of 40.9%. BlueStar optimized the processing technology for 7 sets of key units, enhanced the self-control level, and achieved the annual revenue of RMB174 million. Xinghuo Organic Silicone Plant reviewed the DCS application optimization, and maintained the self-controlled rate of the whole system at 90%, and the key control loop usage rate of above 80%.

Case: Zhonghao Chenguang innovated the supply chain management, to achieve cost reductions and efficiency increases

Zhonghao Chenguang launched the project of “reducing cost and increasing efficiency based on supply chain changes”, and promoted the construction of supply chain and the whole supply chain system, to reduce costs and increase efficiency. Through strengthening process controls, reducing intermediate links and procurement costs, expanding supply channels and taking other measures, Zhonghao Chenguang aimed to continuously provide raw materials and equipment of good quality, reasonable prices and stable supply for product manufacturing. The project significantly reduced the production delays due to supply quality, and reduced the inventory fund occupation of RMB6 million. In 2012, bulk material quality conformance rate reached 94.8%, and cumulative cost of RMB10.54 million was saved.

Typical initiatives

E-commerce procurement covered 45 major categories and 5,259 varieties, with transparent procedures, controllable process and traceable results. Centralized procurement of 2.97 million tons of coal, and saving costs of RMB35.15 million. ChemChina Petrochemical Co., Ltd. optimized the logistics structure, increased the proportion of oil pipeline transportation, and saved cost of RMB156 million. ChemChina Petrochemical Co., Ltd. strictly controlled transportation loss of import crude oil, and reduced the depletion rate from 3.8 ‰ to 2.8‰, and losses of RMB50 million. Shenyang Chemical Industry Co., Ltd., Lanzhou Silicon Materials Co., Ltd. and other enterprises obtained the direct power supply preferences, saved electric charge of RMB73 million.

Centralized Purchasing Management

We strengthened the centralized purchase of coal, crude oil, calcium carbide, natural rubber, steel and other bulk raw materials, formed the standardized procurement process and information-based procurement platform, and optimized logistics distribution, to continuously reduce procurement costs.

Coal

Crude oil

Calcium carbide

Natural rubber

Steel

Centralized

purchase

25


VALUE

3.3 Informationization Construction

We promoted the in-depth integration of business and information technology, deepened application of collaborative office and ERP system in production and operation, human resources, financial management, etc., and continuously improved management efficiency.

Typical initiatives

We applied the ERP system for another 14 enterprises, and conducted ERP post evaluation of 12 enterprises, as well as system health examination and assessment rankings. We actively promoted the application of online training platform, training 550,000 personnel throughout the year. We continuously strengthened IT team building and operation & maintenance support capability, configured CIO for 60 enterprises in place, established 21 information systems in data centers to safeguard normal and smooth operation of more than 56,000 users, and resolved 20,629 incidents, with the user satisfaction of 99.7%. We comprehensively implemented and completed the launch and acceptance of the property management information system, achieved information management of basic property right management data, and made property right management more open, timely, and transparent. Relying on the HR system, we developed the financial dynamic talent database to facilitate daily management of financial staff and lay the foundation for subsequent work shift and CFO appointment.

Case: China National Tire & Rubber Co., Ltd. strived to create the “1+6>7” effect of informatization

China National Tire & Rubber Co., Ltd. and its 6 subordinate enterprises established the CIO joint meeting mechanism, becoming the first “experimental field” of the Group’s CIO joint meeting mechanism. Through regular discussions, in-depth enterprise research, hiring external experts to provide advice and carry out expertise training, etc., members of the joint meeting will exchange and share the experience and achievements about management improvement and informatization construction, discuss to address the common issues of rubber companies concerning informationization construction, and actively integrate information resources of rubber companies, promote management improvement, and make traditional rubber companies modern and intelligent.

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26

4. IMPROVING THE CAPACITY TO SERVE

In face of scant market demands and pressures from decline of product prices, we gave play to the “leading” role of marketing, innovated services based on customer demands, and promoted steady growth in production and management by improving services.

Typical initiatives

We deepened application of “eight major tools” for marketing, and enhanced management over client information and product prices. We advanced construction of direct sales system, distribution system and e-commerce system, and actively explored the chemical distribution forms. SinoShine International Energy Dalian Co., Ltd. was making transformation to distribution business, and BSI and the world’s largest distributor began to cooperate. ADAMA Branch in India comprehensively extended sales services, with the market size increased by 9 times.

Case: “Home of customers” of Zhenghe Petrochemical Group Co., Ltd.

Adhering to the customer-oriented pr inc iple , Zhenghe Petrochemical Group Co., Ltd. tried to promote fine management of service quality, and bui l t “home of customers” where customers can enjoy personal ized consulting services and keep up-to-date with loading information at any time while resting, to improve service quality and customer satisfaction.

27


VALUE

Case: Huaxing Petrochemical improves customer satisfaction with fine services

To grasp customers’ “hearts”, Huaxing Petrochemical comprehensively improves service “hardware and software” and quality through details. Huaxing Petrochemical gave full play to the role of shopping guide consulting service desk in guiding customers to complete all business processes, properly solving customers’ diff iculties, and feeding back complaints and suggestions in a timely manner. Many prompt boards and bulletin boards were set up in the business lobby, to make customers keep abreast of information and dynamics on oil products and feel convenience. In 2014, customer satisfaction reached up to 95%.

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28

DRIVING NEW GROWTH THROUGH

TECHNICAL INNOVATIONChemChina strengthened innovation, improved the system of scientific and technological innovation and promoted scientific and technological innovation culture building. By scientifically allocating scientific resources and promoting the application of scientific and technological achievements, it injected inexhaustible impetus for its own development, and contributed to industry development. In 2014, ChemChina won the “National Science and Technology Advancement Award for Engineering Enterprises Excellent in Technology Innovation” by SASAC.

398398 invention patents granted

3,883R&D spending RMB3,883 million

743743 patents granted

29

DRIVING NEW GROW

TH THROUGH TECHNICAL INNOVATION

1. IMPROVING THE TECHNICAL INNOVATION SYSTEM

We are committed to building the science and technology innovation platform featured by top-down alignment and mutual promotion. We increase the investment in important areas of scientific and technological innovation, to win financial support of government. We improve hard power of technology innovation, strengthen introduction, training and development of scientific and technological talents, build dynamic and aggressive teams on scientific and technological innovation, strengthen intellectual property management, and inspire innovation activities to enhance soft power of technological innovation.

1.1 Establishing Technical Innovation Platform

We actively promote construction of the scientific and technological platform, to lay a solid foundation for science and technology innovation. By the end of 2014, we had a total of 123 R&D institutes, including 28 national ones. AEOLUS TYRE CO., LTD. and Tianhua Institute of Chemical Machinery &Automation Co., Ltd. won the National Innovation Demonstration Enterprise award.

Construction of the Sci-tech platforms

Completed

6 institutions including Guangzhou Research Institute obtained the qualification as one of the third batch of national industrial product quality control and technical evaluation laboratories approved by the Ministry of Industry and Information Technology.Southwest Research and Design Institute of the Chemical Industry built three platforms for gas purification and conversion test.Nanjing 7425 established the Enterprise Research Institute and founded Nanjing Chemical Testing Center together with Shenyang Rubber Research & Design Institute.Shuguang Rubber Institute and Northwest Research and Design Institute of the Chemical Industry were chosen as the aeronautical rubber research and production center and the test and verification center by the General Armament Department of Air Force.National Drying Technology and Equipment Engineering Technology Center of Tianhua Institute of Chemical Machinery &Automation Co., Ltd. passed acceptance, and two provincial technology research centers passed the site assessment.National Research Center for Carbon Black Material Engineering of Carbon Black Research & Design Institute passed site acceptance and assessment.

Under construction

BlueStar State Key Laboratory for “CFRP” entered the phase of review.ChemChina Agrochemical Corporation implemented the plan for building the ADAMA China Research and Development Center, hired the person in charge of the Center and carried out preliminary construction.

Proposed

The Central Research Institute of China Chemical Science and Technology (CRICC) actively promoted establishment of “technology innovation strategic alliance for fine chemicals catalysis industry”.Analysis and Testing Center of Liming Research Institute of Chemical Industry was approved to establish a municipal-level key laboratory.

123By the end of 2014, we had a total of 123 R&D institutes, including 28 national ones

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30

Case: Nine major development platforms of China BlueStar Group Co., Ltd.

China BlueStar Group Co., Ltd., strengthens building technology platforms, steadily improving its scientific research strength. Up to now, China BlueStar Group Co., Ltd. has a total of 4 laboratories and 5 research centers. In 2014, Guangzhou Research Institute and Bluestar Lehigh Engineering Institute were rated as “Industrial (Synthetic Materials Aging) Product Quality Control and Technology Assessment Laboratory” and “Industrial (Chemical Mines) Product Quality Control and Technology Assessment Laboratory” by the Ministry of Industry and Information Technology, which enhanced their soft strength in technology evaluation, testing, project contracting and design concerning “synthesis material aging” and “chemical mine” fields.

1.2 Increasing Input in Technical Innovation

In 2014, ChemChina invested RMB3.883 billion in scientific research, accounting for 1.62% of business income. ChemChina launched 813 research projects including 168 state key projects, 136 key projects at the provincial or municipal level, and 509 enterprise projects. ChemChina obtained the provincial and ministerial-level research funds of more than RMB257 million.

1.3 Building a R&D Team

We strive to establish an introduction and cultivation policy focusing on high-level talents such as the Chief Technology Officer and academic leaders as well as a growth channel for Young and middle-aged scientific and technological personnel in order to promote the scientific and technology innovation power and the core competitiveness of the Company. As of the end of 2014, there were 7,260 R&D personnel throughout the system, among whom, 3 were academicians of Chinese Academy of Engineering, and over 2,630 were senior technical personnel.

1.4 Strengthening Intellectual Property Management

We steadily implement the intellectual property strategy, and constantly improve the IPR management system, to prevent intellectual property risks. In 2014, ChemChina ranked fifth for the fourth consecutive year among central enterprises in patent ownership. Four patents respectively from China BlueStar Chengrand Research Institute of Chemical Industry, Changsha Design and Research Institute, Bluestar Lehigh Engineering Institute and Lanzhou BlueStar won the China Excellent Patents award. By the end of 2014, ChemChina had a total of 4,655 patents including 2,885 invention patents, 12 patents applied in America, Japan and Europe, and 10 PCT patents.

Sci-tech

Innovation

Platform of

China BlueStar

Group

4 laboratories 5 research centers

• Industrial (Synthetic Materials Aging) Product Quality Control and Technology Assessment Laboratory of Guangzhou Research Institute

• Industrial (Chemical Mines) Product Quality Control and Technology Assessment Laboratory of Bluestar Lehigh Engineering Institute

• Industrial (Plastic and Chemical New Materials) Product Quality Control and Technology Assessment Laboratory of China BlueStar Chengrand Research Institute of Chemical Industry

• Zhejiang Key Laboratory of the Seawater Desalination Technology Research of Hangzhou Water Treatment Technology Research Center

• Beijing Carbon Fiber Engineering Research Center of China National Bluestar (Group) Co., Ltd.

• Shangdong New-type Surfactant Engineering Research Center of Shandong Dongda Chemical Industry Co., Ltd.

• Hunan Research Center for Potassium and Concomitant Comprehensive Development Engineering of Changsha Design and Research Institute

• Jiangsu Esterificaiton and Hydrogenation Engineering Research Center of Nanjing BlueStar New Chemical Materials Co., Ltd.

• Jiangsu Environmental Microbial Agents Engineering Research Center of Bluestar Lehigh Engineering Institute

741741 patents filed, including 439 for invention

743743 patents granted, including 398 for invention

2020 PCT patents filed, with 3 granted

99 patents and 20 PCT patents applied in America, Japan and Europe, with 4 and 3 granted respectively

31

DRIVING NEW GROW


Typical initiatives

We completed the Research on Patent Management of Central Enterprises entrusted by the SASAC.

The Fifth ChemChina Excellent Patent Selection activity was carried out. Zhonghao Chenguang won the grand prize, 8 projects including that of Northwest Research and Design Institute of the Chemical Industry won the first prize, and Qenos won the special prize.

ChemChina Petrochemical Co., Ltd.

BlueStar

Haohua

China National Tire & Rubber Co., Ltd.

ChemChina Agrochemical Corporation

• The achievement of “industrial application of heavy oil fluid catalytic cracking devices with cold regenerant circulation technology” won the first prize of Science and Technology Advancement Award from China Petroleum and Chemical Industry Federation.

• Daqing Zhonglan Petrochemical Co., Ltd. obtained about RMB 20,000 of Heilongjiang special patent reward. It held special lectures on intellectual property and standard ized the col lect ion , arrangement and reporting of patent materials. It rewarded valid patents to stimulate technical personnel’s enthusiasm for and initiative in applying for patents.

• Analyzed patent technology strategies and enlarged patent coverage areas; sorted out key industries, attached importance to developing key technical standards and improved patent portfolio. Conducted trace analysis and forewarning of product standard information and prevented risks of standard.

• Changsha Design and Research Institute formulated the Management Measures for Achievements of Institute to standardize reporting and reward of patents and outstanding achievements. Arranged main business patents based on patent analysis with the goal of strengthening core technologies.

Won nine “Outstanding Patent Awards” of China National Chemical Corporation with four units honored as “Outstanding Units of Patent Management”, and got five national, provincial and municipal honorable titles of intellectual property management.

• Aeolus Tyre Co., Ltd. won the honorable title of “Demonstration Enterprise for Intellectual Property Application” by Henan province and of “Advanced Enterprise of Patent Work” by China National Chemical Corporation”. Achieved the zero breakthrough in foreign-related patents in 2014 and filed 11 patents in Europe, North America and South Korea. As the national superior enterprise of intellectual property, it was chosen as pioneer enterprise for establishing the management system of intellectual property. It established the management system of intellectual property and integrated elements of intellectual property protection into the whole value chain so as to realize the systematic management of intellectual property. In addition, it established a personalized patent database to offer technical support for research and development.

• “Radial tire with filling rubber in carcass” of ChemChina Guilin Tire Co., Ltd. won China Excellent Patents award for three continuous years. Guilin Tire is the only enterprise in Guilin that got the prize. It formulated and implemented intellectual property strategies, ensured patent application amount and greatly increased the ratio of patent application quality and patent for invention. It became a national pilot unit for intellectual property and an intellectual property demonstration unit in the Guangxi Zhuang Autonomous Region.

• Nanjing 7425 was identified as one of the first demonstration enterprises of intellectual property in Nanjing. It used the intellectual property to protect core technologies and maintained the leading role in technology. It participated in a series of activities organized by the government for demonstration enterprises, such as various training sessions of intellectual property, university-industry-research cooperation, inline patent exchange and connection, legal protection and so on, so as to build a platform for technology innovation.

75% high content ethephon aqueous solution of Jiangsu Anpon Electrochemical Co., Ltd. is firstly registered in China.

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32

2. GAINING TECHNOLOGY INNOVATION RESULTSWe build a culture of respecting science and technology and encouraging innovation, continuously enrich the technology innovation results, and promote industrialization and conversion of innovation results into real productivity.

2.1 Enriching Technology Innovation Results

We continuously improve science and technology innovation platforms and innovation teams, steadily increase investment in scientific and technological innovation, deeply implement the intellectual property strategy, and have achieved lots of scientific and technological innovation results. In 2014, ChemChina obtained 46 scientific and technological awards at the provincial and ministerial level.

Honors (partial)

• The 1.2 MMTA Potassium sulfate packaged technology of Lop Nor Saline Lake Project developed by Changsha Design and Research Institute and Bluestar Lehigh Engineering Institute won the first prize of National Science and Technology Advancement Award.

• The integrated technology of Clean-incineration developed by Tianhua Institute of Chemical Machinery &Automation Co., Ltd. won the second prize of National Science and Technology Advancement Award.

• The “high-temperature-resistant flanged edge conveyor belt” developed by Qingdao Rubber Six Group Co., Ltd. was awarded the second prize of Shandong province technological invention Award, and the first prize of Qingdao technological invention Award.

• The “industrial application of heavy oil fluid catalytic cracking devices with cold regenerant circulation technology” by ChemChina Petrochemical Co., Ltd. and Luoyang Weida Petrochemical Engineering Co. Ltd. won the first prize of Science and Technology Advancement Award by China Petroleum and Chemical Industry Federation. The research on key technologies and standards for safety, energy conservation and environmental protection of high performance tires by North Rubber and Plastics Institute, the research on technologies for CNR synthesis and application by China BlueStar Chengrand Research Institute of Chemical Industry, and the research and application of waterborne nontoxic low smoke expansion-type fire coating materials by Haihua Research Institute won the second prizes of Science and Technology Advancement Award by China Petroleum and Chemical Industry Federation.

Typical initiatives

Elkem of Norway successfully developed a new alloy material for polysilicon that can effectively extend the service life of standard silicon and reduce the light-induced defects of crystalline silicon solar cells.

Shenyang Chemical Industry Co., Ltd. developed the PVC paste resin for foaming artificial leather which reaches the domestic advanced level, as well as the PVC paste resin new visbreaking agent, and the new surface modification fumed silica to raise silicone rubber tear strength.

China BlueStar Chengrand Research Institute of Chemical Industry developed and applied 2 high performance fiber technologies in projects, breaking the foreign technique blockade.

The project of basic research on purification of calcium carbide furnace exhaust gas and extraction and application of highly efficient natural gas launched by Southwest Research and Design Institute of the Chemical Industry under the National 973 Program passed the acceptance by the Foundation Division of the Ministry of Science and Technology.

National high-tech marine research projects of Haihua Research Institute including the research on key technologies for ocean engineering corrosion protection and the research on development and application of key technologies for high-performance green and environmental marine paints, passed the mid-term inspection and evaluation.

Nanjing 7425 successfully developed and achieved mass production of brake rubber hoses for high speed trains.

Hubei Sanonda Co., Ltd. conducted independent research & development and cooperation on glyphosate, paraquat and so on, in terms of environmental protection and improvement of process and preparation, and launched more than 40 research projects.

The project of developing technologies for processing 800,000 tons of ethylene in Wuhan per year which was launched by Tianhua Institute of Chemical Machinery &Automation Co., Ltd. and Sinopec Engineering Incorporation (SEI) together will promote comprehensive localization of key large-scale ethylene equipment and improve the equipment localization rate. The aramid fiber solvent desalting technology jointly developed by SINOPEC Yizheng Chemical Fibre Co., Ltd. and Changzhou University realizes the continuity, high efficiency, low energy consumption, high recovery and low pollution of polymerization solvent recovery.

46ChemChina obtained 46 scientific and technological awards at the provincial and ministerial level

33

DRIVING NEW GROW


Case: Southwest Research and Design Institute of the Chemical Industry helps China achieve technology localization of the whole industry chain of coal-based natural gas

The “pilot-scale experiment technology of coal-based natural gas methanation” jointly developed by Southwest Research and Design Institute of the Chemical Industry and CNOOC Gas and Power Group Ltd. is an achievement with completely independent intellectual property rights, reaches the world leading level, and realizes industrialization, marking that China has mastered all technologies for the whole industry chain of coal-based natural gas. Industrialization of technological achievements will promote efficient and clean use of coal, and optimization of the energy structure, and ease the coal overcapacity situation. We will increase natural gas supply to help reduce haze, provide technical support for building “a beautiful China”, and promote the green, circular, low-carbon and healthy development of coal chemical industry.

Case: The methionine project of BlueStar Adisseo (Nanjing) Co., Ltd. fills the domestic gap

The products manufactured through the liquid methionine Rhodimet (AT88) production line of BlueStar Adisseo (Nanjing) Co., Ltd. which is China’s first integrated liquid methionine equipment with the world’s largest production capacity, are comparable with the products of the factory in Burgos of Spain. It changed the situation that China fully depended on import of liquid methionine, and promoted the upstream extending of feed industry chain, and the development of feed processing industry and breeding industry.

Coal chem

ical i

ndustry

Green

Circular Low

-car

bon

Healthy

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3. PROMOTING TECHNOLOGICAL ADVANCEMENT IN THE CHEMICAL INDUSTRY

Leading the industry through innovation and adhering to the principle of ”mutual benefit, and win-win cooperation”, we make full use of accumulated sci-tech innovation resources, and promote technological progress of the industry together with our peers.

Case: Hangzhou Water Treatment Technology Development Center supports the development of seawater desalination industry in China

The project of “research on 12,500 tons/day single integration technology and 100,000 tons/day engineering assembly technology” undertaken by Hangzhou Water Treatment Technology Development Center under the national science and technology support program of the 12th Five-Year Plan, passed acceptance. It independently researched and developed a stand-alone device with the capacity of 12,500 tons/day seawater desalination by reverse osmosis, and launched a demonstration project concerning the stand-alone device. The technical achievements in this regard promote the development of seawater desalination technology in China, are of great significance to large-scale seawater desalination projects, and pave the way for industrialization of domestic key equipment and large devices. Hangzhou Water Treatment Technology Development Center has undertaken 8 international seawater desalination projects, improving the international competitiveness of seawater desalination industry.

Case: Chairman (former General Manager) Ren Jianxin of ChemChina won the Lifetime Achievement Award for China Cleaning Industry

In 2014, Chairman Ren Jianxin won the Lifetime Achievement Award by the Industry Cleaning Association of China. As the pioneer of China’s industrial cleaning industry, Ren Jianxin adheres to the concept of “hard work and business promotion to serve the country”, and founded China’s first professional cleaning company BlueStar Cleaning Co., Ltd., marking the start of specialized industrial cleaning services. With further application and promotion of cleaning technology, National Chemical Cleaning Technology Research and Promotion Center and National Cleaning Industry Information Center were set up to promote industry exchanges. Ren Jianxin helped the industrial cleaning industry form the complete system combining product production, equipment manufacturing, technology research & development and technical services, and improve quality and efficiency.

2.2 Fac i l i tat ing the Appl i cat ion of Technology Innovat ion Achievements

Taking technology innovation strategy as a guide and market demands as the orientation, we speed up the industrialization of technology innovation results.

Honors (partial)

• The “key technology of super-critical carbon dioxide water-free dyeing and industrialization” developed by Guangming Research Institute of Chemical Industry was awarded the first prize of Liaoning Province Science and Technology Award.

• The project of Chenguang Research Institute of Chemical Industry about “developing the industrialization technology for production of 2,500 tons of new PTFE dispersed concentrated solution per year” won the grand prize of Science and Technology Award by the Group.

Typical initiatives

The industrialization of ”technology of making natural gas through methanation of coke oven gas” by Southwest Research and Design Institute of the Chemical Industry is of great significance to energy conservation, emission reduction and energy substitution of China’s coking industry.

Labyrinth compressor developed by Tianhua Institute of Chemical Machinery &Automation Co., Ltd. is first applied in China’s BOG area, to meet the emergency needs of gas of main urban areas of Hangzhou at peak time of winter.

The industrialization demonstration project of manufacturing 1 million sets of green fuel-saved tires made of solution polymerized styrene-butadiene rubber (SSBR) per year launched by North Rubber and Plastics Institute and AEOLUS TYRE CO., LTD. was granted the subsidy fund of RMB9 million by the Ministry of Finance for transformation of science and technology achievements.

New utility patent of Shenyang Rubber Research and Design Institute – rubber diaphragm product for boron recycling system, supports the grid-connected generation of Hongyanhe Nuclear Power Station, the first nuclear power station in Northeast China, and ensures Liaoning people can use economic and clean nuclear power.

”Surface-brightening technology Star-Shining” developed by Nantong Xingchen Synthetic Material Co. Ltd. breaks the technical bottlenecks of beauty electric appliance, and can be directly applied as outer parts.

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DRIVING NEW GROW


3.1 Carrying Out Exchanges and Cooperation in Science and Technology

We advocate sharing of resources, mutual aid and communication, and integration of various advantages and resources, to enhance the industry influence and promote the healthy development of the industry.

Typical initiatives

C h e m C h i n a c o m p i l e d a b o o k o n t h e involvement of petrochemical and chemical industries in military services, and a yearbook on science and technology industry of national defense.

The large engineering monograph Soda Engineering (third edition) chiefly edited by Dal ian Research & Design Inst i tute of Chemical Industry was published, to commemorate Hou Debang, the pioneer of China’s soda industry.

Case: Carbon Black Research and Design Institute held the 2014 China Carbon Black Prospect Summit

Carbon Black Research and Design Institute held the 2014 China Carbon Black Prospect Summit, exchanged 40 academic papers, and organized many keynote speeches such as the Sustainable Development of Green, Low-carbon and Intelligent Achievement Industries. Carbon Black Research and Design Institute tries to enhance the influence of China’s carbon black industry in the world, and help China’s carbon black industry understand the global carbon black industry more comprehensively and deeply, particularly the competition situation and production technology development trend of carbon black industry in the Asia-Pacific region. In addition, Carbon Black Research and Design Institute helps China’s carbon black industry in scientific planning and rational distribution, and contributes to China’s marching from a big carbon black country to a strong carbon black country.

Tips:

China Carbon Black Prospect Summit is the largest, highest-level and most authoritative academic meeting for China’s carbon black industry. So far, 13 sessions have been held (one session every two years). It has a significant influence on carbon black circles of China and the world. China Carbon Black Prospect Summit was initiated in 1988. Formerly known as the “National Carbon Black Technology Seminar”, it was renamed as China Carbon Black Prospect Summit in 2006 and became international.

For more than 20 years, China Carbon Black Prospect Summit has become a communication platform favored by carbon black circles at home and abroad, playing an active role in making China’s carbon black industry go global, improving the influence of China’s carbon black industry on the world, and promoting the development of global carbon black industry. Now it has become comparable to the Carbon Black World and the Carbon Black Perspective in Asia-Pacific.

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Case: Hangzhou Water Treatment Technology Deve lopment Center deepened trade cooperation

H a n g z h o u W a t e r T r e a t m e n t T e c h n o l o g y Development Center initiated the establishment of an industry association, organized exchanges and integrated resources to promote the progress of the industry.

• Established China’s first provincial membrane industry association in conjunction with others. Hangzhou Water Treatment Technology Development Center initiated and united five units including Zhejiang University and BlueStar (Hangzhou) Membrane Industry Co., Ltd. to found the Zhejiang Association of Membrane Industry. Hangzhou Water Treatment Technology Development Center built exchange and promotion platforms for the membrane industry to promote industrial development, and established expert databases, member databases and other library resource libraries to promote resource sharing.

• Co-hosted the Freshwater Industry Forum. Hangzhou Water Treatment Technology Development Center and five other units including National Society of Seawater Desalination and Water Reuse jointly sponsored the Summit Forum for Academicians of the Chinese Academy of Engineering on “Water Environment Protection under Climate Change Background” & Second West Lake International Forum on Seawater Desalination and Water Reuse. At the Forum, they discussed China’s related policies of seawater desalination industry, present status, trend and application of seawater desalination at home and abroad. The Center helps to promote the industry-university-research academic exchange and integration at home and abroad, water resources protection, water reuse, and development of seawater desalination industry.

3.2 Participating in the Formulation of Industry Standard

We optimized the industry-university-research cooperation mechanism and constantly improved the industry standard system. The number of the technology standards we drafted, participated in formulating and amending throughout this year stands at 140, among which, four were international standards, 136 were standards of national and industrial level. We participated in five international standard organizations.

140In 2014, participated in formulating and amending 140 technology standards

37

DRIVING NEW GROW


Honors (partial)

• Liu Huichun of Shenyang Rubber Research and Design Institute won Long-term Service Award by the National Technical Committee of Rubber and Rubber Products.

• The research on key technologies and standards for safety, energy conservation and environmental protection of high performance tires by North Rubber and Plastics Institute, and the research on CPE test method and the revision of industry standard HG/T 2704, won the second prize and third prize of Science and Technology Advancement Award respectively by China Petroleum and Chemical Industry Federation.

Typical initiatives

China BlueStar Group Co., Ltd. formulated the national standards for methionine products, energy consumption quota and industrial pollutants emission, to enhance industry protection.

Southwest Research and Design Institute of the Chemical Industry participated in formulation of national standards for coal-based natural gas, to promote the development of coal-based natural gas industry in China and ensure there are rules and laws to abide by in pipeline transportation, mixed transportation and consumption of coal-based natural gas. It also participated in formulation of five national standards including that for pure methane and high-purity methane, to create a fair competitive environment and build the unified market rules.

Guangming Research Institute of Chemical Industry revised two national water treatment standards, and participated in compilation of two water treatment industry standards, to regulate and guide the production and evaluation of domestic water treatment industry products.

Bluestar Lehigh Engineering Institute drafted the national standard Determination of Lead, Arsenic, Mercury in Phosphate Rock and Concentrate, to promote normal circulation of phosphorus ore and improve the technology system for the chemical ore standardization.

Hebei Xinji Chemical Group Co., Ltd. participated in the formulation of the national standard Regulations on Treatment and Disposal of Waste Hydrogen Sulfide, and the industry standards including the Industrial Strontium Hydroxide Octahydrate and the High-purity Industrial Product Strontium Nitrate, to improve the reputation of high purity inorganic salt industry.

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SETTING A NEW BENCHMARK FOR PRODUCTION SAFETY

ChemChina firmly establishes the “red line” safety production awareness and bottom line thinking, strengthens safety management, strictly conducts safety control, and strives to establish a long-term mechanism for safety production.

21,090Rectified hidden dangers 21,090 items

0.04%Mortality per one thousand

489Spending on occupational safety RMB489 million

39

SETTING A NEW BENCHM

ARK FOR PRODUCTION SAFETY

1. IMPROVING OUR SAFETY MANAGEMENT SYSTEM

We continued to deepen the SHE management system construction, reviewed SHE system documents, and revised the SHE Performance Assessment Measures to continuously enhance safety management.

Typical initiatives

We deepened the SHE management system construction, audited and reviewed eight key high-risk enterprises in terms of SHE management system construction, operation and standardization compliance.

We improved SHE system files, prepared and revised the SHE checklist, and further decomposed 180 check items of 12 SHE system elements into key check points.

We revised the SHE Performance Assessment Measures, adjusted scoring and reward & punishment regulations, strengthened punishment of enterprises suffering deaths in succession, and completed SHE responsibility assessment of persons in charge of specialized companies.

Under the guidance of Qenos experts, 12 BlueStar enterprises rectified according to specific weaknesses, making systems run more efficiently.

After systematic statistical analysis and study of various accidents of ChemChina in the past 10 years since establishment through information tools and statistical methods, we sorted out cases and formed an assembly for all levels of personnel to learn.

2. SOLIDIFYING OUR FOUNDATION FOR PRODUCTION SAFETY

We continuously strengthen management and supervision over safety production, comprehensively implement the safety production responsibility system, and carry out standardization work to enhance safety guarantee. In 2014, the whole system invested RMB489 million for production safety.

2.1 Safety Hazard Identification

We formulated safe production inspection solutions, conducted safety supervision inspections, complete safety management measures and comprehensively raise the safety management of the enterprise, achieving safe and stable operation across the whole system. Through safe production inspection across the system, we found 22,034 hidden dangers, and rectified 21,090 items, a rate of 95.7%.

Typical initiatives

A f ter safety check of 22 key enterprises, we detected 573 hidden dangers and issued 17 rectification notices.

We carried out the activity of ”detect ing hidden dangers by thousands of team leaders and tens of thousands of staff”, and analyzed accident causes through Lean Six Sigma and other tools.

Case: China National Tire & Rubber Co., Ltd. strengthens dust hazard management

China National Tire & Rubber Co., Ltd. renovated the weakness in the safety management. The company supervised storerooms safety with clear divisions and responsibilities, such as petrol, diesel, chemicals, sulphur, carbon black and other flammable and explosive areas, taking measures of ventilation and dedusting of specific dust atmosphere to avoid dust accumulation and explosion.

1,000Qenos created a record of zero accident for 1,000 consecutive days and 1 million working hours.

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40

2.2 Intensifying Emergency Management

We continuously strengthen emergency management system construction, and enhance the ability to handle accidents through emergency drills. In 2014, 313 emergency drills were organized across the system, covering 12,000 personnel.

Typical initiatives

Carrying out integrated emergency drills featured by all-staff participation and multi-sectoral alignment. We paid attention to the effect of oil and gas enterprises in dealing with the emergencies including refueling pipeline leakage and oil pipeline leakage, strengthened emergency drills for dangerous chemicals production enterprises to prevent leakage and poisoning.

Strengthening cooperation with related parties. Asimco Danchi Components (Sichuan) Co., Ltd. organized heat-treatment workshop and natural gas rescue group to carry out natural gas leakage emergency drills. Haohua Junhua Group Co., Ltd. invited local safety supervision bureau, environmental protection agency and fire brigade to participate in emergency drills for the whole process, and tested the convergence between emergency plan and local government emergency plan.

We made cards printed with post site disposal plans for employees to learn and consult, and conducted spot check of employees at any time during safety check, to urge employees to learn the emergency response plan.

Case: Southwest Research and Design Institute of the Chemical Industry organized the fire-control emergency drill

S o u t h w e s t R e s e a r c h a n d D e s i g n Institute of the Chemical Industry organized all the staff to participate in the fire-control emergency drill against security accidents. Comprising fire escape-rescue drill and fire-control skills training, the fire-control drill further strengthened the staff’s safety awareness and effectively enhanced their fire-control skills.

Huaxing Petrochemical conducting emergency drill of oil and gas pipeline leakage

12,000In 2014, 313 emergency drills were organized across the system, covering 12,000 personnel.

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2.3 Improving Our Management of Hazardous Chemicals

We earnestly supervised hazardous technologies, products and hazard sources in key areas to prevent and decrease the occurrence of chemical accidents.

Typical initiatives

We strengthened the safety supervision and management over 194 major hazard sources, 50 hazardous chemicals under special supervision of the State Administration of Work Safety and 16 kinds of technologies under special supervision to improve security supervision and management and accident emergency rescue of hazardous chemicals warehouses.

Case: Heilongjiang Haohua Chemical Group Co., Ltd. strengthened the management of hazardous chemicals

Heilongjiang Haohua Chemical Group Co., Ltd. earnestly implemented the Regulations on Safety Management of Hazardous Chemicals and strengthened the supervision and inspection by management departments and the vocational training for operation staff; established relevant management system for hazardous chemicals according to processes involving hazardous chemicals; placed poison information cards at poisonous positions, developed the emergency rescue plan for hazardous chemicals accidents and regularly implemented the plan to eliminate the hidden dangers of hazardous chemicals.

2.4 Occupational Health and Safety

We paid attention to detection of vocational hazards and prevention of occupational diseases, continued to improve the sanitary conditions of the workplaces, as well as the staff’s occupational health and safety.

Case : Sanming Doub le -Whee l Chemical Machinery gave lectures on industrial injury prevention

By holding trainings on industrial injury prevention and analyzing the major reasons for industrial injuries and potential factors of industrial injuries in machinery industry, Sanming Double-Wheel Chemical Machinery enhanced the staff’s awareness of industrial injuries, offered solid assistance to units and departments of all levels to carry out industrial injury prevention, and effectively reduced the occurrence of industrial injuries and occupational diseases.

Hazardous technologies

Hazardous products

Hazard sources

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3.2 Building a Safety Culture

Taking the safety production month activity as the carrier, we carried out various activities of publicizing safety culture, promoted enterprise safety culture construction, and comprehensively improved the safety consciousness of employees, to realize the transformation of employees’ mind from “I am required to be safe” to “I need to be safe”.

Typical initiatives

Organizing family members of employees to visit the factory, and holding “family affection meetings” to cultivate family safety culture.

Carrying out safety activities in teams and groups including publicity of “One Thing, Safety”, and swears to ensure safety.

Cangzhou Dahua Group Co., Ltd. won national “Ankang Cup” prizes for four successive years, and Xinghuo Organic Silicone Plant was awarded the title of “National Safety Culture Model Enterprise”.

Guilin Rubber Machinery established the “Safety Day Inspection & Report” and “Safety Weekly Report” systems, published inspection and assessment results to the whole factory by mails, and shared safety inspection information, to make all departments pay more attention to safety and strengthen safety inspection.

3. FOSTERING A SAFETY CULTURE

We strengthened education and training for the staff, led them to establish the correct safety concept. Carried out family safety training to promote safety culture construction, and created better safety atmosphere.

3.1 Conducting Safety Training

We steadfastly established the concept of people orientation and safety development, enhanced safety training, and solidly improved the staff’s self-prevention awareness, laying a sound foundation for safety production. The whole system organized up to 3,725 trainings on special operations, position skills, accident investigations, and laws and regulations, covering 138,000 people.

Typical initiatives

We analyzed the accident causes with the tools including Lean Six Sigma to improve the staff’s safety awareness and their ability to identify hazardous behaviors.

China National BlueStar (Group) Co., Ltd. continued to improve materials of safety training and compiled safety training courseware such as Observation of Safety Behavior and Fire Operations.

Case: Haohua Yuhann Chemical Co., Ltd. proposed innovative education model

Haohua Yuhang Chemical Co., Ltd. changed the education model to guarantee the education quality and effect, organized compilation of video courseware of safety training and conducted safety education on shuttle buses. The Company held lectures on cardiopulmonary resuscitation, organized the staff to watch video courses of cardiopulmonary resuscitation, and invited Dean Guo from the staff’s hospital to give explanations on site. The Company held matches of wearing emergency prevention equipment and awarded the staff with excellent performance to arouse the staff’s enthusiasm in learning the above knowledge.

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Units Safety Production Month Activities

Dezhou Shihua Chemical Co., Ltd.

• Carrying out a series of activities such as safety culture publicity, safety responsibility certificate signature, special lectures on safety, potential safety hazard surveys and governance, case analysis study, safety knowledge questionnaire, specific safety inspection, safety regulations amendment, emergency rescue exercises, etc.

Haohua Yuhang Chemical Co., Ltd.

• Comprehensively studying HAZOP analysis reports, accident cases and so on

• “Finding Fault” in safety consciousness, job management, facilities maintenance and other aspects post by post, and one by one, to strengthen all employees’ “Red Line” awareness for safety production

Zhonghao Chenguang

Research Institute of Chemical

Industry

• Carrying out extensive publicity and education by means of special display panels, blackboard newspaper, and cable broadcasting televisions

• Conducting comprehensive emergency drill of “One Post, One Case” for each unit

• Carrying out series of activities such as warning education on safety production accidents, essay and speech contests on safety, “Ankang Cup” safety knowledge contest, “Youth Safety Supervision Posts in Action”, etc.

Heilongjiang Haohua Chemical Group Co., Ltd.

• Holding activities of accident case education, analyzing typical accidents and accident cases, analyzing causes, summarizing lessons, and exploring rules

• Strengthening chlor-alkali processes construction and emergency response capacity construction of PVC device staff to improve the emergency response capacity of frontline teams and groups

Dalian Research & Design Institute of Chemical Industry

• Carrying out safety publicity to all staff by means of publicity display panels, audio-visual videos, etc.

• Carrying out self-examination and self-correction for potential safety hazards and organizing the study of safety operation regulations by department

China National Chem


44

GREEN AND ENVIRONMENTAL, EXPANDING THE NEW SPACE

We thoroughly implemented basic state policies of resource saving and environmental protection, intensified energy saving and emission reduction, developed circular economy, generalized low carbon techniques, reinforced the capacity of sustainable development, and strove to realize the optimization of comprehensive benefits.

121.68COD emissions 121.68 million tons

3.7%Comprehensive energy consumption per RMB10,000 output reduced 3.7% year-on-year

102.70Total volume of effluent discharge 102.70 million tons

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GREEN AND ENVIRONMENTAL, EXPANDING THE NEW

SPACE

1. IMPROVING OUR ENVIRONMENTAL MANAGEMENT SYSTEMWe improved our environmental management system, established a network platform that covered the Group’s three-tier management structure, and built a long-term benchmarking mechanism featured by “comparison with the advanced, gap analysis, continuous improvement and continual surpassing” to optimize our environmental management model.

2. PROMOTING GREEN OPERATIONSWe focused on the comprehensive utilization of resources, improved the efficiency of resource utilization from systems, techniques, management and other aspects, increasingly popularized and used new techniques for energy-saving and cost-reducing, and made efforts to build a resource-saving and environment-friendly enterprise.

2.1 Promoting Energy Conservation and Emission Reduction

We continued to promote the “zero emission” management, and advanced energy saving and emission reduction further to make the energy consumption per ten thousands Yuan output of the Group reduce 3.7% year-on-year by establishing an energy saving target responsibility and appraisal system with “specific targets, clear responsibility, initiatives in place, upper level controlling and assessing lower level”.

Typical initiatives

We strengthened organizational system construction, established the energy saving and emission reduction leading group, and formulated the Interim Management Measures of China National Chemical Corporation for Energy Saving and Emission Reduction, and the 12th Five-Year Plan of ChemChina for Energy Saving and Emission Reduction .

W e d e c o m p o s e d a n d i m p l e m e n t e d energy saving and emission reduction tasks for 2014, signed the letters of responsibility for achieving energy saving and emission reduction goals, formulated t h e B e n c h m a r k i n g R e g u l a t i o n s f o r China National Chemical Corporation’s Oil Refining Enterprises , and revised the Group’s Energy Saving & Emission Reduct ion Per formance Assessment Measures , to increase the appraisal strength and precision of energy saving and emission reduction.

We tracked and supervised the completion of energy saving and low carbon targets of 53 enterprises in the Group, and helped Lanzhou Silicon Materials Co., Ltd., Xinghuo Organic Silicone Plant and other enterprises establish measurements, to guarantee the completion of tasks.

We strengthened process control and early warning, refined the special appraisal targets of oil refining, synthesis?ammonia and other products, and comprehensively completed annual task targets of the Group in energy saving and emission reduction.

Case: Tianjin Petrochemical Industry Co., Ltd. got the reward of energy saving from the government once more

Tianjin Petrochemical Industry Co., Ltd. took energy conservation transformation as the motivation of inward development, successively implemented 5 energy saving projects, that is, transforming speed controllers of gas compressor, recycling oil and gas in gas station, remolding transformers and power distribution facilities, and optimizing energy consumption during storage and transportation, and got RMB1 million energy saving reward from Tianjin people’s government. Thereinto, the project of transforming speed controllers of gas compressor adopted the new type electrical hydraulic speed controller, and saved 16,000 tons of steam annually in contrast with mechanical speed controllers used in the past, achieving remarkable comprehensive benefits.

Case: All staff of Haohua Yuhang Chemical Co., Ltd. took actions to promote environmental protection

Haohua Yuhang Chemical Co., Ltd. carried out the activity of “Meeting Standards of Environmental Protection and Emission Reduction” comprehensively, checked sources of pollution from source, actively carried out benchmarking activities according to industry and relevant standards, established the pollution source ledger, formulated emission reduction control measures, constantly improved, and strove to realize the goals of energy saving and emission reduction.

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2.2 Building a Circular Economy

On the principles of “Reduction, Reuse, Recycling” of resource, we transform the development mode and establish an industry chain based on circular economy with low consumption, low discharge and high efficiency.

Case: Reuse rate of purified water in Zhenghe Petrochemical Group Co., Ltd. reached 100%

Zhenghe Petrochemical Group Co., Ltd., via the technical transformation of process units, fully introducing the purified water generated by the sour water stripping unit into each process unit to substitute fresh water and demineralized water, achieved 100% reuse of purified water. Every year, 480,000 tons of fresh water and demineralized water can be saved, and more than RMB1 million production cost can be directly saved. Meanwhile, the operation load of sewage works was reduced accordingly and about RMB160,000 operating cost can be saved.

2.3 Advocating Green Office

We adhere to the thought of “energy conservation, low carbon” in our daily office activities all the time, actively advocate water saving and power saving, vigorously push forward office automatization, strictly control office expenses, strive to reduce unnecessary expenditures, and gradually form a full set of rules and regulations; meanwhile, we intensify the upgrading of old equipment, generalize the use of new energy-saving technologies and products, strengthen publicity of the green office, and strive to build a green and efficient office environment.

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GREEN AND ENVIRONMENTAL, EXPANDING THE NEW

SPACE

Case: Tianhua Institute of Chemical Machinery & Automation Co., Ltd. won the second prize of National Science and Technology Advancement Award for its clean-incineration integration technology

“Clean-incineration integration technology for sludge-stirring indirect thermal drying and composite circulating fluidized bed”, jointly developed by Tianhua Institute of Chemical Machinery & Automation Co., Ltd., Zhejiang University and TDG Machinery Technology Co., Ltd, etc. won the second prize of National Science and Technology Advancement Award in 2014. Such technology has the advantages of high utilization ratio, low energy consumption, small investment, and easy implementation. It can also realize the sludge reduction, hazard-free treatment, recycling and integrated energy utilization, thus having prominent socioeconomic benefits.

Case: Tianjin Petrochemical Industry Co., Ltd. improved manufacturing techniques

Tianjin Petrochemical Industry Co., Ltd. successively completed five technical innovation projects including diesel heat transfer and adjustment of catalytic apparatus, optimization of circulating water system, and replacement of feedstock nozzle of catalytic apparatus, which further excavated the reuse resources which can produce waste heat and helped the Company save 7,600 tons of standard coal. Through the methods such as process optimization and the improvement of running quality of catalytic apparatus, carbon dioxide emissions during incineration and flare discharge were reduced.

3.2 Providing Eco-Friendly Products and Services

We devote ourselves to providing chemical products and services with low energy consumption and low emission, and share the achievements of green development with interested parties.

Case: Zhonghao Chenguang Research Institute of Chemical Industry launched the special fluororesin

Zhonghao Chenguang Research Institute of Chemical Industry launched the special fluororesin with heat stability, chemical resistance and weather fastness. After being processed by downstream enterprises, such fluororesin can be widely used in the exhaust gas emission equipment of steelworks, thermal power plants, waste incineration works and cement plants, effectively reducing the PM 2.5 in the atmosphere.

3. PROMOTING GREEN SERVICES

We actively promote the transformation and application of new environmental technologies, so as to assist the low-carbon development of chemical industry.

3.1 Researching and Developing Environmental Technology

Taking the green and environmental protection as the goal, we constantly increase the input in technical innovation, laying a solid foundation for the sustainable development of chemical industry.

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EMPLOYEE GROWTH, CREATING NEW BUSINESS OPPORTUNITIESChemChina highly values the growth of employees. Regarding the human resources building as the core, optimization of talent structure as the mainline, and intensifying the talent incentive and restraint mechanism as the breakthrough, we devote ourselves to creating a good development environment and condition for the employees, and building a talent team with personnel of excellent quality and reasonable structure.

100%100% staff membership rate of labor union

28%28% female employees

1,128Hired 1,128 graduates in 2014

EMPLOYEE GROW

TH, CREATING NEW BUSINESS OPPORTUNITIES

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China National Chem


1. PROTECTING THE INTERESTS OF OUR EMPLOYEES

We strictly comply with the 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 to safeguard the legit imate r ights and interests of employees, and build transparent and open communication channels, to ensure that the employees can enjoy the right to know, right of choice and right of petition, and to establish a harmonious and stable industrial relation. Throughout the year, there was no significant labor dispute. In 2014, the Company had 119,838 employees, including 71.8% male employees and 28.2% female employees; the Company had 3,541 employees from ethnic groups, accounting for 3.2%; the Company had 10,380 overseas employees, accounting for 8.7%; the Company hired 1,128 graduates of 2014.

Typical initiatives

We reinforced the labor contract management and improved the labor employment mechanism. In 2014, the labor contract signing rate reached 100%, and the collective contract signing rate reached 100%. We optimized the salary and welfare system to solve the employees’ worries. In accordance with the principle of linking pay to performance, we rationally regulated and controlled the total wages, strictly standardized the position-related consumption, and optimized the salary and welfare system, providing the salary and welfare with local competitiveness for employees. We strengthened the democratic management, and safeguarded the democratic rights of employees to be the master of their own affairs. In 2014, the labor union has a 100% staff membership rate, with funds RMB218.5 million, holding 131 meetings of the workers’ conferences, collecting 5,236 opinions and suggestions, with a 91.4% of adoption rate

Case: Changyi Petrochemical Co., Ltd. cares for the female employees

Paying close attention to the growth, physical and psychological health of female employees, Changyi Petrochemical Co., Ltd. led the female employees to take the actions of “making achievements in their own posts” and “love & support”. It strengthened the organizational building of female employees, with two teams and groups successively awarded the 38 Red Flag Collective, one female employee elected as the representative of Municipal People’s Congress, and one female employee rated as the advanced individual of ChemChina Petrochemical Corporation.

Changyi Petrochemical Co., Ltd. won the title of “Advanced Collective of Female Employees” by Weifang Federation of Trade Union after the appraisal and selection of best female employees in Weifang.

Total staff119,838

Female28%

Ethnic minorities staff

3.2%

72%Male

50

Employment mech

anis

m2. ACHIEVEMENT OF EMPLOYEES’ VALUE

We adhere to the equal employment system, and set up a democratic, open, competitive and preferential mechanism for talents selection and employment. We pay close attention to employees’ career development appeals, constantly improve the training system, expand the career development path, implement the plan to cultivate talents, and try to promote the vocational development of employees, and accomplish the value of employees.

2.1 Diversification Education Training

We constantly improve the training system, provide the individualized training schemes, and design targeted training contents for employees of different levels to improve their vocational ability.

Staff Training System

Skill

ed

personnel

Pro

fess

iona

l t

echnical personnel M

anag

ement personnel

Successor and leadership development programs: training leadership team members at all levels of the company

ChemChina Central Party School training courses: training leading young and middle-aged cadres

Team leader remote training: enhancing the skills and management capacity of grassroots leaders as a “connecting link” in the enterprise

Deputy CHRO classes: training the deputy Chief Human Resources Officer

Deputy CFO classes: training the deputy Chief Financial Officer

Discipline inspection and supervision classes: training cadres on discipline inspections and supervision

Youth League committee secretary training courses: training the Youth League committee secretary

Deputy director of security training courses

Democratic

Open

Competitive

Preferential

EMPLOYEE GROW


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2.2 Optimizing Career Development Opportunities

We highly value the career development of employees, establish and improve the career development framework for employees, innovate the personnel training mode, create good conditions for talent training and development, actively push forward the vocational training, and strive to realize the common growth of employees and the Company.

Case: Overall coverage of CTPM/6S in Chenguang Research Institute of Chemical Industry

Zhonghao Chenguang Research Institute of Chemical Industry held the CTPM/6S training for Shanghai Chenguang High Polymer Material Co., Ltd., covering 24 personnel. The formulation and implementation of CTPM/6S scheme realized the overall coverage of CTPM/6S for Zhonghao Chenguang Research Institute of Chemical Industry and vigorously improved the management level of the Company.

Case: “from bottom to up” mode of China National Tire & Rubber Co., Ltd. to train innovative talents

China National Tire & Rubber Co., Ltd. initiated the “from bottom to top” personnel training mode to discover and cultivate youth talents for the first time.

• AEOLUS TYRE CO., LTD. held five trainings lectured by senior executives and over 300 people participated in;

• Yellowsea Rubber carried out the special trainings on safety, quality, production, fire control, marketing and enterprise culture;

• ChemChina Guilin Tire Co., Ltd. carried out the post training activities of “masters instructing and mentoring apprentice”;

• Qingdao Rubber Six Group Co., Ltd. carried out over 100 specialized knowledge trainings for over 2,000 employees.

Typical initiatives

Nanjing 7425 insists on separation of evaluation and appointment, and dynamic management, and implements the engagement system for the selected high-level personnel. In July this year, by means of job competition, three doctors and two professional managers acquired their technical and management posts.

Relying on the workstation, Zhenghe Petrochemical Group Co., Ltd. gives full play to the leading role of chief technicians and senior technicians, and adopts the ways of theory study, communication and discussion, DCS simulation drills, practical drills, as well as work shift to give play to the leading role of grass-roots talents.

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3. ENHANCING EMPLOYEES’ WELL-BEING

We enhance corporate culture construction, solve the most direct, desired and beneficial problems for employees in their life and work, share with them the achievements of company development, and improve their living quality and happiness index.

3.1 Creating a Harmonious Corporate Culture

We adhere to the core value of “creating value for shareholders and creating employment opportunities for the society”, carry forward the enterprise spirit of “perseverance and harmony in diversity”, and spread the corporate culture of “everybody can do something” to create a harmonious atmosphere.

Typical initiatives

50 excellent chemical employees won “2013 ChemChina Medal”. Two photography works, Partita of Construction Site from Nanjing BlueStar New Chemical Materials Co, Ltd, and Oneiromancy from ChemChina Guilin Tire Co., Ltd. were rated as the excellent works by SASAC in “New State-owned Enterprise in Chinese Dream” Internet video contest. Labor union of Xinghuo Organic Silicone Plant exhibited employees’ works of calligraphy, art, photography and handicraft with the topic of safety, environmental protection and quality. The exhibition works come from retired veteran cadres, front-line employees and their relatives respectively. Changyi Petrochemical Co., Ltd. won the title of “Weifang Advanced Collective of Female Employees”. Nie Renguo, head of Mobile Department of Zhenghe Petrochemical Group Co., Ltd., and Shang Haobin, head of Mobile Department of Huaxing Petrochemical won the title of “National Excellent Workers of Equipment Management”.

Case: BlueStar Silicones France provided “silicone class” for the children of employees

BlueStar Silicones France opened a three-day “organosil icon class” to 12 children of employees and invited them to participate in the business negotiation, and visit the laboratories and manufacturing workshops, so as to help them know the different operating posts of chemical industry.

EMPLOYEE GROW


53

China National Chem


3.2 Care for Our Employees

We paid attention to improving the working and living quality of employees, and created a favorable working atmosphere.

Case: Project of “Warm Shuttle Bus” launched

Nanjing 7425 Rubber & Plastic Co., Ltd. launched the home-returning activity, renting coaches from Nanjing Transit Argos Bus Co., Ltd. to send employees home for free. In January, the Company prepared for the Spring Festival Travel, contacted Nanjing Transit Argos Bus Co., Ltd. about shuttle buses and planned the routes according to the number of personnel and places reported by factories and departments. The Company set up three routes and arranged one liaison person for every route in charge of getting off and driving safety to ensure employees could return home in time and safely.

Case: Haohua Qingping Phosphorite visited households to assist employees

Haohua Qingping Phosphorite established an employee assistance mechanism that combines daily and long-term assistance, to help employees who are in poverty caused by illness, schooling of children, or accident, and meet their extremely urgent needs. The consolation activity covered vast mine areas, employees’ living areas and employees’ households with the consolation fund of RMB512,700, benefiting 926 employees and gaining positive evaluation from employees and their family members.

54

Employees’ Recreational and Sports Activities

China Haohua Chemical

Group Co., Ltd. (CHC)

Fun games on Women’s Day

ChemChina Guilin Tire Co., Ltd.Lantern Riddle on Mid-autumn Day, combining education with recreation

Yiyang Rubber & Plastics

Machinery Group Co, Ltd.

Participating in “Yiyang Dream

– Large Poem Recitation

Evening Party”

ChemChina Zhuzhou R&D

Institute for Rubber &

PlasticsLectures on

morality

ChemChina Petrochemical Co., Ltd.Activity of gifting summer welfare products

Jiangsu Anpon Electrochemical Co., Ltd.,Female employees participated in the public square dancing competition to celebrate Women’s Day

EMPLOYEE GROW


55

China National Chem


Honors of employees (partial)

“National Advanced Individuals of Retired Cadre”, Li Junxian (academician)

Li Ruikang was named the Innovation Model in 2013-2014 National “Ideal & Contribution Competition”

The chairman of BlueStar Adisseo, Mr. Gerard Deman (left) was honored with the Friendship Award of the Government of China in 2014

Nie Renguo from Zhenghe Petrochemical and Shang Haobin from Huaxing Petrochemical won “National Excellent Workers of Equipment Management”

Yang Yong won the “Model Worker of Central Enterprise”

56

SOCIAL HARMONIES AND SHARING THE NEW ACHIEVEMENT

We always adhere to combining enterprise development with the sustainable development of the business location, share development opportunities and resource values with resource place, promote local economic development, support educational undertakings, organize anti-poverty work in poverty-stricken areas, carry out employee volunteer activities, and jointly develop with all sectors of society to build harmonious social relations.

36,71836,718 hours of volunteer services

1,9671,967 young volunteers

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SOCIAL HARMONIES AND SHARING THE NEW

ACHIEVEMENT

1. STRATEGIC COOPERATION

We strived to promote and guide the healthy deve lopment o f industry cha in , innovat ing c o o p e r a t i o n m o d e l , s h a r i n g d e v e l o p m e n t achievements and achieving mutual benefit, win-win result and mutual development with partners.

2. SAFEGUARDING THE RIGHTS AND INTERESTS OF OUR SUPPLIERS

We insist on the principle of “green purchase, improving management, excellent service and creating value”, guiding suppliers positively to fulfill social responsibilities and optimizing the environment of industrial competition.

Typical measures

BlueStar Adisseo (Nanjing) Co., Ltd. and Fermentalg jointly researched and developed the new product for animal nutrition, providing the sustainable solution for the global imbalance between supply and demand of protein products.

Bluestar (Beijing) Chemical Machinery Co., Ltd. signed a contract with NAC Company of Algeria through CONVE & AVE of the US on the project of the 6,000 ton/year skid-mounted electrobath, marking the products’ successfully entering into the African market.

Bluestar (Beijing) Chemical Machinery Co., Ltd. and Shenyang University of Chemical Technology signed the Agreement on the Strategic Alliances of Technological Innovation and Industry-university-research-practice Cooperation and the Agreement on Cooperatively Developing the Technology of Working Condition Simulation for Ionic Exchange Membrane Cell to enhance new product development based on the research on the technology of working condition simulation for ionic exchange membrane cell and improve China’s overall level of chemical equipment.

Unit Measures and effect of supplier management

Group Company

• Centralized purchase of bulk raw materials such as coal, crude oil, calcium carbide, natural rubber and rolled steel

• Optimized logistic structure, increased the proportion of pipeline oil transportation and strictly controlled the loss in the transportation of import crude oil

• Rate of centralized purchase of coal reached 97%, enterprises of centralized purchase of coal reached 20 and purchase quantity reached 2.97 million tons, with the saved cost of RMB35.15 million

China National BlueStar (Group)

Co, Ltd.

• EGreatwall platform was actively utilized to realize informatization management of centralized purchase and the on-line strategic material purchase of Bluestar

• Centralized purchase amount of 7 main raw materials including phenol, acetone and titanium reached RMB1.57 billion with year-on-year growth of 110%, with the saved cost of RMB13.5 million

• Enterprises and strategic suppliers were organized to achieve centralized purchase of 220,000 tons of material of RMB5.5 billion, saving the cost of RMB746 billion

ChemChina Petrochemical

Co., Ltd.

• Long-term supply contract and spot purchasing contract were combined together; long-term contracts of importing crude oil were signed with Australia, Angela and other countries to ensure the safe and stable supply of imported crude oil

• 80% crude oil was imported from the oil company in the oil producing country

• Purchasing management was further improved; post operating instruction, foundation database, letter of credit and relative business files were established or prepared, to strengthen data collation and quantitative analysis

China National Tire & Rubber

Co., Ltd.

• Centralized purchase of bulk raw materials of 380,000 tons at the cost of RMB3.6 billion, saving the cost of RMB173 million

• E-commerce platform for purchasing was established, realizing the on-line purchase of bulk raw materials, with the on-line purchase rate of 78.3%

China National Chemical

Equipment Corp

• Adhered to the principle of Purchasing All That We Need, actively promoted centralized purchasing through Greatwall e-commerce platform, recorded 44 framework agreements, and purchased the materials of RMB1.5 billion at the group level

China National Chem


58

Units Measurements and Effects of “Agriculture, Farmers and Rural Areas” Service

ChemChina Agrochemical Co.,

Ltd.

• Exploited market services, promoted the communication between old and new customers, accelerated innovative development, committed to food security, agricultural products quality safety and eco-environment safety, and facilitated the modern plant protection to serve modern agriculture better

• Invited experts in China Agricultural University to undertake trainings and discussions, launched the agrochemical e-commerce model and technique service system oriented to serving “Agriculture, Farmers and Rural Areas”, and carried on pilot projects of terminal construction oriented to retail shops in Jiangsu, Heilongjiang and other provinces.

ADAMA• Conducted close cooperation with the consultant team, researchers and orchard workers, developed and

tested several varieties of formulas, and reduced the application amount and vestigital of fruit thinning agent products for much safer use.

3. SERVING RURAL DEVELOPMENT

We are devoted to advancing the circulation of agricultural production factors, improving the market system, and strengthening the promotion of products and techniques, to support the increase of food production, farmers’ income and investment.

3.1 Providing High-Quality Agricultural Products

As the world’s largest non-patented pesticide producer and the world’s sixth largest pesticide producer and dealer, we positively understood and responded to the demands of customers, popularized modern agricultural planting techniques, and promoted the sustainable and healthy development of agriculture, making contributions to realizing “high-yield, high-quality, high-efficiency, ecological, and safe” modern agriculture.

Our products cover herbicides, pesticides, bactericides, plant growth regulators and other series, as well as more than 120 varieties of original drugs and over 800 preparations. We have registered almost 5,000 products and 6,000 trademarks in 120 countries all over the world. Dichlorvos, pymetrozine and other products ranked first in market share at home.

3.2 Improving Our Agricultural Service System

We positively promoted the application of modern agricultural techniques in production, and provided high-tech and environment-friendly agricultural products, helping farmers master modern agricultural planting techniques.

Case: Zhonghao Chenguang Research Institute of Chemical Industry strictly managed contractors

Zhonghao Chenguang Research Institute of Chemical Industry enhanced the safety management of contractors to decrease contractor’s damage rate of operation and ensure health of employees of contractors, and formulated the Requirements on Safety, Health and Environment Management of Contractor (herein after referred to as “Requirements”). Taking the SHE system of Group Company and the safety management system of Qenos as the standard, the Requirements cover 8 major categories and 300 specific items including general safety requirement, requirement of coming in and out, safety training requirement, personal protective device requirement, work permit system, safety requirements of waste treatment and emergency rescue, thus standardizing the management of contractors and their employees’ operations and further laying the foundation for the SHE work of the company.

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ACHIEVEMENT

4. PROMOTING CULTURAL INTEGRATION

We actively promoted the communication between Chinese and foreign employees, deepened overseas employees’ recognition of corporate culture, encouraged recreational and sports activities in subordinate companies, facilitated the organic integration of Chinese and Western cultures, and strove to be the most popular chemical company in the world.

Case: Dream-Pursuing “Flower & Youth”

On July 20, BlueStar Group ushered in the 25th International Summer Camp. The summer camp themed by “World Dream, BlueStar Dream, My Dream”, had a total of 22 sub-camps around China, and more than 950 little BlueStar campers from over 10 countries started a wonderful summer camp tour, pursuing their dreams here. BlueStar Summer Camp, with the number of campers from over a dozen in 1990 to nearly a thousand now, serves as an important bridge which embodies BlueStar’s culture and links up its foreign and domestic employees.

Climbing the Mutianyu Great Wall Group photo of campers and Chairman Ren Jianxin

A little camper made an exclusive birthday card

A creative pattern for BlueStar’s birthday

Promotion of Cultural Integration

During the over 20 days, these l i t t le campers took part in various activities, such as climbing the Mutianyu Great Wall to experience the heroic spirit of brave men, visiting the science and other kinds of museums, learning to make festive lanterns from Qinhuai Festive Lantern craftsmen, attending military training. The foreign and Chinese campers fully communicated with each other through language and other ways unique to children, which illustrates BlueStar’s cultural essence of “We are Family”.

A Gift Presented to BlueStar’s Birthday

The year 2014 witnessed the 30th anniversary of BlueStar as well as the 25th anniversary of BlueStar International Summer Camp. The campers in Beijing Sub-camp made special birthday cards with imagination for BlueStar and the summer camp, and made a creative pattern in the shape of “30” and “25” to present a gift for the 30th anniversary of BlueStar and the 25th anniversary of BlueStar International Summer Camp.

Real-time Sharing of Fresh News

For the first time, BlueStar set up a specific public account on Wechat, released the information of the summer camp in time and interacted with fans so as to let more people know about BlueStar Summer Camp and further understand BlueStar’s culture.

“Watching the happy faces of children, I suddenly have an impulse to go back to my school days and take part in BlueStar Summer Camp to pursue my dreams. I, on behalf of all the parents, sincerely hope that the little campers will happily spend these unforgettable 20 days and become people with dreams.”

——Guo Huixia, a Wechat netizen

China National Chem


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5. ENTHUSIASTIC ABOUT PUBLIC WELFARE

We adhered to the concept of being good enterprise citizens, and actively took part in public welfare activities primarily through public welfare donations and volunteer activities.

5.1 Public Welfare Donations

We increasingly improve the charitable activity mechanism, to guarantee the openness and transparency of public welfare donations, build a social atmosphere of mutual assistance, and promote the development of social and public welfare cause, and provide the society with love and warmth.

Case: China National BlueStar (Group) Co . , L td . car r ied out targeted poverty alleviation in Gulang county

China National BlueStar (Group) Co., Ltd. has carried out targeted poverty alleviation in Gulang County for 10 consecutive years. BlueStar carried out poverty alleviation work for “the New Generation of Gulang People”, organized poor students to take part in BlueStar Summer Camp to broaden their horizons; donated two “self-improvement classes”, helping 100 excellent poor students complete their 3-year high school education. BuleStar exploited the industrial advantages to the full, and made full use of local resources to support the construction in Gulang County. For 10 years, BlueStar has invested RMB3.091 million, making c o n t r i b u t i o n s t o i m p r o v i n g l o c a l people’s lives.

Case: Hebei Xinji Chemical Group Co., Ltd. helped poor students realize their dreams of going to school

Hebei Xinji Chemical Group Co., Ltd. pays attention to poor employee families, striving to help them realize the dream of going to school after understanding their poor situation. The labor union organized 11 children from poor employee families to take part in the activity of issuing golden autumn education grants and bags by the Xinji Federation of Trade Unions, gave out RMB9,500 to 4 poor students, and provided seven middle school and high school students from poor employee families with love schoolbags, the Four Great Classical Novels of Chinese Literature and reference books; also encouraged children to develop good learning habits, and supported them in reading classics and building dreams.

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ACHIEVEMENT

5.2 Volunteer Activities

We make full use of our resources, offer volunteer services, reward society with love, and increase social welfare. In 2014, 1,967 young volunteers of the Company provided volunteer services for 36,718 hours.

Case: “Love Mooncakes” of Q i n g d a o A n b a n g s h o w a harmonious relationship between society and the enterprise

On the eve of Mid-autumn Festival, Q ingdao Anbang Youth League Committee carried out the activity of “Offering Love to Communities” in Jihongtan Street in Qingdao. The volunteer group successively came to the geracomium in Xiaya Community and the kindergarten in Nanwan Community, and sent festival blessings to the elderly and children, expressing their care for communities.

Case: Changyi Petrochemical Co., Ltd. carried out the helping & supporting activity

Changyi Petrochemical Co., Ltd. seriously implemented the instructive spirit of Changyi Party Committee and Changyi People’s Government, actively fulfilled social responsibility, helped and supported mutually with poor villages in pair, successively helped Xihuabu village finish hardening the 5,000 m main road, and broadened the road to enter the village, providing convenience for villagers; Changyi Petrochemical Co., Ltd. helped village party branch and village committee repair and afforest their offices, built an activity square, and gave them books related to planting, breeding, agricultural techniques, etc.

China National Chem


62

PROSPECTS FOR THE FUTURE2015 is the beginning year to comprehensively implement the strategy of ruling the country by law, and also the final year to complete the 12th Five-Year Plan. ChemChina will deepen the implementation of the decisions made at the 18th National Congress of the Communist Party of China, the Third and Fourth Plenary Sessions of the 18th CPC Central Committee, take the initiative in adapting to economic “New Normal”, continue to deepen the reform, adjust the structure, seek improvement in stability, achieve innovative development, center on improving quality and effectiveness, and focus on establishing the mature business mode and effective incentive constraint mechanism, to promote the transformation and upgrading of ChemChina to a new height.

Establish mature business modes, and realize the values of customers. We will focus on structural adjustment, actively promote the continuous optimization of structures of the industry, products, techniques, and organizations. We will also grasp market opportunities, balance the speed and quality, adjust the speed without reducing impetus, and increase the quantity with better quality, to promote the reform and development of the enterprise to a new height, and realize its rapid, healthy and sustainable development.

Insist on innovation orientation, and improve efficiency through technology. We will comprehensively study and judge the tendency of science & technology innovation and industry transformation in the world, persist in market orientation and industrialization, confirm the breakthrough of innovation, search for the power source of innovation, and rely on innovation to cultivate the new competitive advantage of ChemChina.

Improve the SHE management system, and enhance the level of security and environmental protection in essence. We will firmly establish the “red line” safety production awareness and bottom line thinking, strengthen safety management, strictly conduct safety supervision, and strive to establish the long-term mechanism for safety production. We will adhere to the concept of “zero emission” and the principles of “total quantity control, and source governance”, enhance the comprehensive treatment and utilization of contaminants, promote circular economy, ensure compliance emissions, and strictly control environmental risks.

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China National Chem


Establish the incentive constraint mechanism, and build high-quality talent teams. We will be performance-oriented, improve the salary system, set standards of basic remuneration, performance remuneration and tenure incentive remuneration, and implement differentiated remuneration allocation; improve the supervision system, make use of information-based system, establish a constraint mechanism with specific targets and strong operability, pay equal attention to introducing and cultivating, and optimize the talent structure; strengthen the pertinence, planning and diversity of talent training, and improve the professional level of employees at all levels.

Actively assume social responsibility, and establish a good enterprise image. We will strive to win the respect of customers with excellent products and services, actively respond to expectations and appeals of relevant stakeholders to fight for harmonious development space, increase the investment in community construction, and establish a reliable, brave, and responsible enterprise image.

We have a long way to go to realize the sustainable and healthy development. In 2015, ChemChina will comprehensively promote scientific development by improving the quality and efficiency with more positive attitude and aggressive spirit, and make positive contributions to realizing the Chinese Dream – the great rejuvenation of Chinese nation.

EXPERT COMMENTS

As the pillar and basic industry of national economy, chemical industry plays an integral role in people’s everyday life, industrial raw materials production, and high-tech sector that determines national destiny. As the largest enterprise in China’s chemical industry, China National Chemical Corporation (“ChemChina”) actively fulfills its social responsibilities when boosting the development of national economy. China National Chemical Corporation Sustainability Report 2014 gives a vivid account of ChemChina’s practices and achievements in its performance of the responsibilities for sound operation, scientific innovation, production safety, environmental protection, employee growth and social harmony.

Tangible results in production safety: Chemical industry has been traditionally viewed as one high-risk industry. Since chemical industry has such unique features as flammabil ity, explosiveness, toxicity and hazard, and tends to suffer those major accidents with considerable losses and effects, people usually become jittery at the mention of chemical industry. ChemChina firmly establishes the “red line” safety production awareness, strengthens safety management, regulates the safety product ion conducts, establishes the long-term mechanism for safety production, carries out the publicity activities of safety culture, changes the prejudice against chemical industry through satisfactory safety performance and communicates the positive energy of beautiful chemical industry.

Environmental protection of green chemical i ndus t ry : C h e m C h i n a u p h o l d s t h e “ z e r o emission” management, implements the new Environmental Protection Law, and adheres to the concept of green chemical industry featured by high efficiency, energy conservation and environmental protection to lead the green

development of chemical industry. ChemChina continuously develops and improves the environmental technologies of green chemical industry, gradually establishes an integrated value chain which changes wastes into values and pursues clean production and cyclical utilization, and provides the green chemical products and services so as to contribute to building ecological civilization and a beautiful China.

A better life through scientific innovation: As science and technology makes constant progress, chemical industry has enjoyed a closer tie with our everyday life. Now chemicals play a very significant role in production and life. ChemChina promotes the transformation of scientific research, enhances t h e t e c h n o l o g i c a l c o m p e t i t i v e n e s s , q u i c k e n s the application of innovative results, boosts the technological progress and strives for the goal of “creating a better life, supporting national defense construction, and promoting industrial upgrading” to build a colorful, convenient and vigorous world, and a beautiful Chinese Dream”.

I hope that ChemChina can continuously give its advantages into full play, focus much attention on the improvement of people’s livelihood, boost he green, healthy and sustainable development of chemical industry and strive to grow into the world’s leading chemical enterprise with international competitiveness.

Hao ChangjiangVice Chairman of China Petroleum and Chemical Industry Federation

Chairman of China Education Association of Chemical Industry

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C h i n a N a t i o n a l C h e m i c a l C o r p o r a t i o n Sustainability Report 2014, featuring in concise language, well-organized charts and informative contents, demonstrates the company’s new progress in performing social responsibility and promoting sustainable development. In addition, the report indicates the company’s commitment to serve people’s material life through various kinds of chemicals and utilize high-tech to lead the industrial development.

The report is highly effective due to its focus on the concerns of stakeholders. The report attaches importance to hotspot issues and responds to worries and concerns of the public, which reveals that the company takes the implementation of the new environmental law as an opportunity, constantly promotes “zero emission” management, and tackles with the opportunities and challenges of industrial development through green chemical industry. One the one hand, the company strives to achieve clean production by developing new technologies to reduce chemical pollution; on the other hand, it promotes environmental technologies and provides innovative environmental service so that chemical industry and chemicals could become the technological sources of pollution control as wel l as e f fect ive measures o f resources conservation, which indicates that the company is trying to become the good example of environmental protection among chemical companies.

The report is highly material due to its d i sc losure of respons ib i l i ty fu l f i l lment practices in a systematic manner. The report discloses that the company, in an all-round manner, accelerates the transformation of its development pattern, improves its technological competitiveness, lays a solid foundation for safe production and promotes local development in

social responsibility area from the perspectives of good management, technological innovation, safe production, green environmental protection, employee development and social harmony, demonstrating the company’s specific practices and achievements to fulfill social responsibility in areas including safety, environment, economy and society.

The report’s various patterns of manifestation indicate good readability. The well-organized beginning of the report lays stress on the key p e r f o r m a n c e d a t a , s h o w i n g t h e o u t s t a n d i n g achievements in the company’s responsib i l i ty fulfillment; the main body makes the report more vivid and visualized through plenty of cases, in addition, pictures and descriptions bring out the best in each other; the well-organized logic diagrams and various types of designs could bring a pleasant reading experience to readers.

In general, the report presents comprehensive content and a clear logic; therefore, it is a relatively high-level social responsibility report. We expect China National Chemical Corporation to continue to improve its management of CSR and sustainable development, promote the philosophy of social responsibility to integrate into the company’s operation in an all-round manner and make contributions in building a beautiful China and realizing China Dream.

Yin GefeiVice President of China WTO Tribune

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China National Chem


EXPER

T CO

MM

ENTS

GRI INDEXNote: ● Fully disclosed, Partly disclosed, ○ Not disclosed, N Not applicable

No. GRI Content IndexExtent of

DisclosureWhere Reported

(Catalog of Report)

Strategy and Analysis1.1 Statement from the most senior decision-maker of the organization ● P21.2 Description of key impacts, risks, and opportunities ● P2

Organizational Profile2.1 Name of the organization ● P62.2 Primary brands, products, and/or services ● P82.3 Operational structure of the organization, including main divisions, operating

companies, subsidiaries, and joint venturesP6/P11

2.4 Location of organization’s headquarters ● P62.5 Number of countries where the organization operates, and names of countries

with either major operations or that are specifically relevant to the sustainability issues covered in the report

● P6

2.6 Nature of ownership and legal form ● P112.7 Markets served (including geographic breakdown, sectors served, and types of

customers/beneficiaries)● P6

2.8 Scale of the reporting organization ● P62.9 Significant changes during the reporting period regarding size, structure, or

ownership● P11

2.10 Awards received in the reporting period ● P3/P12/P31/P55Report Parameters

3.1 Reporting period (e.g., fiscal/calendar year) for information provided ● Inside front cover3.2 Date of most recent previous report (if any) ● Inside front cover3.3 Reporting cycle (annual, biennial, etc.) ● Inside front cover3.4 Contact point for questions regarding the report or its contents ● Inside front cover3.5 Process for defining report content ● Inside front cover3.6 Boundary of the report (e.g., countries, divisions, subsidiaries, leased facilities,

joint ventures, suppliers). See GRI Boundary Protocol for further guidance● Inside front cover

3.7 State any specific limitations on the scope or boundary of the report ● Inside front cover3.8 Basis for reporting on joint ventures, subsidiaries, leased facilities, outsourced

operations, and other entities that can significantly affect comparability from period to period and/or between organizations

○

3.9 Data measurement techniques and the bases of calculations, including assumptions and techniques underlying estimations applied to the compilation of the indicators and other information in the report.

● Inside front cover

3.10 Explanation of the effect of any re-statements of information provided in earlier reports, and the reasons for such re-statement (e.g. mergers/acquisition, change of base years/periods, nature of business, measurement methods)


3.11 Significant changes from previous reporting periods in the scope, boundary, or measurement methods applied in the report


3.12 Table identifying the location of the Standard Disclosure in the report ● P65-P683.13 Policy and current practice with regard to seeking external assurance for the

report. If not included in the assurance report accompanying the sustainability report, explain the scope and basis of any external assurance provided. Also explain the relationship between the reporting organization and the assurance provider(s).

○

66



(Catalog of Report)

Governance, Commitments and Engagement4.1 Governance structure of the organization, including committees under the

highest governance body responsible for specific tasks, such as setting strategy or organizational oversight

● P11

4.2 Indicate whether the Chair of the highest governance body is also an executive officer.( (and, if so, their function within the organization’s management and the reasons for this arrangement).

○

4.3 For organizations that have a unitary board structure, state the number and gender of members of the highest governance body that are independent and/or non-executive members.

○

4.4 Mechanisms for shareholders and employees to provide recommendations or direction to the highest governance body

● P11

4.5 Linkage between compensation for members of the highest governance body, senior managers and executives (including departure arrangements), and the organization’s performance (including social and environmental performance)

○

4.6 Processes in place for the highest governance body to ensure conflicts of interest are avoided

● P11

4.7 Process for determining the composition, qualifications and expertise of the members of the highest governance body and its committees, including any consideration of gender and other indicators of diversity.

● P11

4.8 Internally developed statements of mission or values, codes of conduct, and principles relevant to economic, environmental and social performance and the status of their implementation

● P10

4.9 Procedures of the highest governance body for overseeing the organization’s identification and management of economic, environmental and social performance, including relevant risks and opportunities, and adherence or compliance with internationally agreed standards, codes of conduct, and principles

○

4.10 Processes for evaluating the highest governance body’s own performance, particularly with respect to economic, environmental and social performance

○

4.11 Explanation of whether and how the precautionary approach or principle is addressed by the organization

● P10-P11

4.12 Externally developed economic, environmental and social charters, principles, or other initiatives to which the organization subscribes or endorses

○

4.13 Memberships in associations (such as industry associations) and/or national/international advocacy organizations in which the organization: Has positions in governance bodies; Participates in projects or committees; Provides substantive funding beyond routine membership dues; or Views membership as strategic.

○

4.14 List of stakeholder groups engaged by the organization ○4.15 Basis for identification and selection of stakeholders with whom to engage ○4.16 Approaches to stakeholder engagement, including frequency of engagement by

type and by stakeholder group○

4.17 Key topics and concerns that have been raised through stakeholder engagement, and how the organization has responded to those key topics and concerns, including through its reporting

○

EconomicEC1 Direct economic value generated and distributed, including revenues, operating

costs, employee compensation, donations and other community investments, retained earnings, and payments to capital providers and governments

● P9

EC2 Financial implications and other risks and opportunities for the organization’s activities due to climate change

● P45

EC3 Coverage of the organization’s defined benefit plan obligations ● P49EC4 Significant financial assistance received from government ● P29EC5 Range of ratios of standard entry level wage by gender compared to local

minimum wage at significant locations of operation● P49

EC6 Policy, practices, and proportion of spending on locally-based suppliers at significant locations of operation

● P57-P58

EC7 Procedures for local hiring and proportion of senior management hired from the local community at significant locations of operation

● P49

EC8 Development and impact of infrastructure investments and services provided primarily for public benefit through commercial, in-kind, or pro bono engagement

● P60

EC9 Understanding and describing significant indirect economic impacts, including the extent of impacts

P60

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China National Chem




(Catalog of Report)

EnvironmentalEN1 Materials used by weight or volume ● P45EN2 Percentage of materials used that are recycled input materials ● P47EN3 Direct energy consumption by primary energy source ● P45-P46EN4 Indirect energy consumption by primary source ● P47EN5 Energy saved due to conservation and efficiency improvements ● P45EN6 Initiatives to provide energy-efficient or renewable energy based products and

services, and reductions in energy requirements as a result of these initiativesP47

EN7 Initiatives to reduce indirect energy consumption and reductions achieved ● P45EN8 Total water withdrawal by source ○EN9 Water sources significantly affected by withdrawal of water ○EN10 Percentage and total volume of water recycled and reused ○EN11 Location and size of land owned, leased, managed in, or adjacent to, protected

areas and areas of high biodiversity value outside protected areasN

EN12 Description of significant impacts of activities, products, and services on biodiversity in protected areas and areas of high biodiversity value outside protected areas

○

EN13 Habitats protected or restored ○EN14 Strategies, current actions, and future plans for managing impacts on

biodiversity○

EN15 Number of IUCN Red List species and national conservation list species with habitats in areas affected by operations, by level of extinction risk

○

EN16 Total direct and indirect greenhouse gas emissions by weight ● 40EN17 Other relevant indirect greenhouse gas emissions by weight ● P40EN18 Initiatives to reduce greenhouse gas emissions and reductions achieved ● P39EN19 Emissions of ozone-depleting substances by weight ● P40EN20 NOx, SOx, and other significant air emissions by type and weight ● P40EN21 Total water discharge by quality and destination ○EN22 Total weight of waste by type and disposal method ○EN23 Total number and volume of significant spills ○EN24 Weight of transported, imported, exported, or treated waste deemed hazardous

under the terms of the Basel Convention Annex I, II, III, and VIII, and percentage of transported waste shipped internationally

○

EN25 Identity, size, protected status, and biodiversity value of water bodies and related habitats significantly affected by the reporting organization’s discharges of water and runoff

○

EN26 Initiatives to mitigate environmental impacts of products and services, and extent of impact mitigation

● P47

EN27 Percentage of products sold and their packaging materials that are reclaimed by category

○

EN28 Monetary value of significant fines and total number of non-monetary sanctions for non-compliance with environmental laws and regulations

○

EN29 Significant environmental impacts of transporting products and other goods and materials used for the organization’s operations, and transporting members of the workforce

○

EN30 Total environmental protection expenditures and investments by type ● P45

68



(Catalog of Report)

Labor Practices and Decent WorkLA1 Total workforce by employment type, employment contract, and region, broken

down by gender.● P49

LA2 Total number and rate of new employee hires and employee turnover by age group, gender, and region

P49

LA3 Benefits provided to full-time employees that are not provided to temporary or part-time employees, by significant locations of operation.

○

LA4 Percentage of employees covered by collective bargaining agreements ● P49LA5 Minimum notice period(s) regarding operational changes, including whether it is

specified in collective agreementsP49

LA6 Percentage of total workforce represented in formal joint management-worker health and safety committees that help monitor and advise on occupational health and safety programs

P42

LA7 Rates of injury, occupational diseases, lost days, and absenteeism, and total number of work-related fatalities by region

P9

LA8 Education, training, counseling, prevention, and risk-control programs in place to assist workforce members, their families, or community members regarding serious diseases

● P53

LA9 Health and safety topics covered in formal agreements with trade unions ● P42LA10 Average hours of training per year per employee by gender, and by employee

categoryP50

LA11 Programs for skills management and lifelong learning that support the continued employability of employees and assist them in managing career endings

P50

LA12 Percentage of employees receiving regular performance and career development reviews, by gender.

○

LA13 Composition of governance bodies and breakdown of employees per employee category according to gender, age group, minority group membership, and other indicators of diversity

○

LA14 Ratio of basic salary and remuneration of women to men by employee category, by significant locations of operation.

○

LA15 Return to work and retention rates after parental leave, by gender. ○Human Rights

HR1 Percentage and total number of significant investment agreements and contracts that include clauses incorporating human rights concerns, or that have undergone human rights screening.

N

HR2 Percentage of significant suppliers, contractors and other business partners that have undergone human rights screening, and actions taken.

N

HR3 Total hours of employee training on policies and procedures concerning aspects of human rights that are relevant to operations, including the percentage of employees trained

N

HR4 Total number of incidents of discrimination and corrective actions taken ● P49HR5 Operations and significant suppliers identified in which the right to exercise

freedom of association and collective bargaining may be violated or at significant risk, and actions taken to support these rights

N

HR6 Operations and significant suppliers identified as having significant risk for incidents of child labor, and measures taken to contribute to the effective abolition of child labor

○

HR7 Operations and significant suppliers identified as having significant risk for incidents of forced or compulsory labor, and measures to contribute to the elimination of all forms of forced or compulsory labor

○

HR8 Percentage of security personnel trained in the organization’s policies or procedures concerning aspects of human rights that are relevant to operations

N

HR9 Total number of incidents of violations involving rights of indigenous people and actions taken

N

HR10 Percentage and total number of operations that have been subject to human rights reviews and/or impact assessments

N

HR11 Number of grievances related to human rights filed, addressed, and resolved through formal grievance mechanisms.

N

69

China National Chem




(Catalog of Report)

SocietySO1 Percentage of operations with implemented local community engagement,

impact assessments, and development programs. ● P57

SO2 Percentage and total number of business units analyzed for risks related to corruption

● P21

SO3 Percentage of employees trained in organization’s anti-corruption policies and procedures

● P21

SO4 Actions taken in response to incidents of corruption ● P21SO5 Public policy positions and participation in public policy development and

lobbyingN

SO6 Total value of financial and in-kind contributions to political parties, politicians, and related institutions by country

N

SO7 Total number of legal actions for anti-competitive behavior, anti-trust, and monopoly practices and their outcomes

○

SO8 Monetary value of significant fines and total number of non-monetary sanctions for noncompliance with laws and regulations

○

SO9 Operations with significant potential or actual negative impacts on local communities

○

SO10 Prevention and mitigation measures implemented in operations with significant potential or actual negative impacts on local communities

○

Product ResponsibilityPR1 Life cycle stages in which health and safety impacts of products and services are

assessed for improvement, and percentage of significant products and services categories subject to such procedures

● P34-P35

PR2 Total number of incidents of non-compliance with regulations and voluntary codes concerning health and safety impacts of products and services during their life cycle, by type of outcomes

○

PR3 Type of product and service information required by procedures and percentage of significant products and services subject to such information requirements

● P8

PR4 Total number of incidents of non-compliance with regulations and voluntary codes concerning product and service information and labeling, by type of outcomes

○

PR5 Practices related to customer satisfaction, including results of surveys measuring customer satisfaction

P26

PR6 Programs for adherence to laws, standards, and voluntary codes related to marketing communications, including advertising, promotion, and sponsorship

● P26

PR7 Total number of incidents of non-compliance with regulations and voluntary codes concerning marketing communications, including advertising, promotion, and sponsorship by type of outcomes

○

PR8 Total number of substantiated complaints regarding breaches of customer privacy and losses of customer data

○

PR9 Monetary value of significant fines for noncompliance with laws and regulations concerning the provision and use of products and services.

○

70

FEEDBACK FORM

Respected readers,

Thank you for reading this report. This is the fifth sustainability report we have released. To improve our efforts relating to corporate social responsibility and enhance our fulfillment thereof, we hope very much that you could spare some time from your busy schedule to comment on this report and make suggestions to help us improve it.

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8. Your are welcome to give your comments and suggestions about the ChemChina Sustainability Report 2014:

You can submit your feedback in any of the following ways:Tel: 0086-10-82677365Fax: 0086-10-82677088Mail: Department of Social Responsibility, Office of Production & Operation, China National Chemical Corporation,No. 62 West Road North 4th Ring Road, Haidian District, Beijing 100080

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SuStainability RepoRt 2014 - chemchina.com.cn · RepoRt 2014 Su S tainability Repo R t ... The report is published in both Chinese and English. If any inconsistency or discrepancy