3SBio : 2021 ESG Report

(Incorporated in the Cayman Islands with limited liability)

Stock Code : 1530 Convertible Bonds Code : 40285

Environmental, Social and Governance Report

2021 Environmental, Social and Governance Report

CONTENTS

3SBIO INC. - 2021 ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) REPORT	1
OUR 2021: ACTIVE EXECUTION AND SOLID ADVANCES	2
	ESG RATING SCORES	2
	ESG WORK HIGHLIGHTS	2
	ESG KEY PERFORMANCE IN 2021	3
1	ESG GOVERNANCE SYSTEM	4
	1.1	SUSTAINABLE DEVELOPMENT CONCEPT	4
	1.2	ESG MANAGEMENT FRAMEWORK	4
	1.3	IDENTIFYING MATERIAL ISSUES	6
2	COMPLIANCE	9
	2.1	COMPLIANCE & ETHICS	9
	2.2	IPR MANAGEMENT AND PROTECTION	14
3	PRODUCT AND CLIENT SERVICE RESPONSIBILITY	15
	3.1	PROVIDING HIGH-STANDARD QUALITY PRODUCTS	15
	3.2	PROVIDING QUALITY SERVICES TO CLIENTS	22
	3.3	RESPONSIBLE MARKETING	23
4	EMPLOYEE DEVELOPMENT RESPONSIBILITY	25
	4.1	EMPLOYEE'S RIGHTS, INTERESTS AND WELFARE	25
	4.2	OCCUPATIONAL HEALTH AND SAFETY	28
	4.3	TALENTS DEVELOPMENT AND RETENTION	30
5	ENVIRONMENTAL PROTECTION RESPONSIBILITY	33
	5.1	ENVIRONMENTAL MANAGEMENT SYSTEM	33
	5.2	REDUCTION OF POLLUTANT EMISSIONS	34
	5.3	ADDRESSING CLIMATE CHANGE	38
	5.4	EFFICIENT USE OF RESOURCES	42
6	SUPPLY CHAIN RESPONSIBILITY	43
	6.1	SUPPLIER QUALITY MANAGEMENT	43
	6.2	SOCIAL AND ENVIRONMENTAL MANAGEMENT REGARDING SUPPLIERS	44
7	SOCIAL CONTRIBUTION RESPONSIBILITY	46
	7.1	SUPPORTING HEALTHCARE DEVELOPMENT	46
	7.2	ENHANCING ACCESSIBILITY TO MEDICINES AND MEDICAL SERVICES	47
8	PERFORMANCE DATA	50
9	INDEX TO THE ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORTING
	GUIDE OF THE HONG KONG STOCK EXCHANGE	57
10	ABOUT THIS REPORT	59

2021 Environmental, Social and Governance Report

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2021 Environmental, Social and Governance Report

Our 2021: Active Execution and Solid Advances

ESG Rating Scores

As a responsible corporate citizen, 3SBIO Inc. (the "Company" or "3SBio", with its subsidiaries collectively referred to as the "Group") makes environmental, social and governance ("ESG") management a priority of its management efforts and has continued to refine ESG management.

The Group's ESG achievements have been recognized by society and the capital market. In 2021, the Group's ESG performance maintained its "A" rating by MSCI, higher than 78 percent of the rated global peers. The Group's CDP Climate Change Questionnaire 2021 score maintained its "B" rating (management level), outperforming 74 percent of the scored companies worldwide, both of which maintain levels at the head of the industry.

ESG Rating History
AAA
AA
A				A	A
BBB			BBB
BB	BB	BB
B
CCC
	Jul-17	Jul-18	Aug-19	Aug-20	Sep-21

ESG Rating history shows five most recent rating actions

ESG Rating Score by MSCI

ESG Work Highlights

Response

Year

Status

Score

Climate Change 2021	2021	Submitted	B
Climate Change 2020	2020	Submitted	B
Climate Change 2019	2019	Submitted	B-

Scores in CDP Climate Change Questionnaire

Governance	Improve Internal and External Compliance and Business Ethics Audit Mechanisms
	The Group has established a long-term and normalized audit and supervision mechanism, comprehensively
	advanced the complete integration of internal audit and internal control, and conducted external audits on
	a regular basis. In 2021, the Group's Audit Department completed internal audits of a total of 19 processes
	at four manufacturing bases, including development strategy, sales and receivables, expenses, social
	responsibility, construction in progress, and research and development, and invited a third party to conduct
	an independent external audit of the Group.
Social	Diversity Management and Evaluation of Suppliers
	To enhance the stability of supply and promote the long-term development of suppliers, the Group carries
	out supplier diversity management and conducts regular evaluations and assessments. In 2021, the Group
	established a new Material Management Committee to support supplier localization and second supply source
	development, avoided procurement risks through supplier diversity management; assessed and scored
	suppliers on product quality and safety, environmental protection and social responsibility, with 80 percent of its
	suppliers assessed in environmental, labor and ethical aspects.

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2021 Environmental, Social and Governance Report

Environment	Promote the Effective Implementation of Environmental Objectives
	By the end of 2021, the Group has set four quantitative ESG targets at the environmental level covering
	four areas: water resource utilization, energy utilization, hazardous waste emissions and greenhouse
	gas emissions. For example, the Group plans to achieve a 30 percent reduction in hazardous waste per
	revenue unit by 2025 compared to 2018. In 2021, each manufacturing base handed over hazardous
	waste to qualified institutions for regular treatment and managed through weekly declarations and ledger
	registration, etc.

ESG Key Performance in 2021

Environmental Performance

Total circulating water amounted to 24,376.00 cubic meters

Greenhouse gas emissions per revenue unit were 8.8 t CO2/RMB million

Social performance

The coverage of employees training reached 100% 80% of suppliers accepted evaluation in environment, labor and

ethics

Training hours per employee averaged 14.37 hours Charitable donations totaled RMB40.82 million

2021 Environmental, Social and Governance Report

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2021 Environmental, Social and Governance Report

1 ESG Governance System

1.1 Sustainable Development Concept

Driven by the mission of "Making innovative biopharmaceuticals within the reach", the Group has been devoted to seeking pharmaceutical solutions for patient clinical needs. Overcoming challenges without stop, it strives to improve patients' quality of life with high-quality medicine and contribute to human health benefits.

The Group regards compliance operation as the foundation of its Corporate Social Responsibility (CSR), honoring its commitments to stakeholders, including shareholders, clients and consumers, employees, the public and the community, and the government and regulators. The Group takes active measures to fulfill its CSRs, provides doctors with reliable treatment tools and patients with trustworthy medicines, assists the government in the reform of the health care system, extends care and support to its employees, and brings hope to the patients and their families in poor economic conditions.

Mission	Vision
• Making innovative	• Based in China, the Group
biopharmaceuticals	aspires to be a leading
within the reach	global biopharmaceutical
	company

Values	Philosophy
• Innovation, Quality,	• Cherish life,
Win-win cooperation	Caring for life,
	Create life

1.2 ESG Management Framework

The Group set up a top-down ESG management framework to ensure efficient implementation of its ESG efforts. The ESG Committee, with the participation of members of the Board of Directors, is responsible for the overall ESG agenda and makes decisions regarding ESG and oversees ESG matters. The ESG Working Group implements decisions and measures under the guidance of the ESG Committee.

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