Annual Report 2021

ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT (CONTINUED) China Merchants China Direct Investments Limited Annual Report 2021 83 SOCIAL RESPONSIBILITY (CONTINUED) Supply Chain Management (continued) Number of the Company’s active suppliers by geographical region: Geographical location Number of active suppliers in 2021 Number of active suppliers in 2020 Hong Kong 10 11 Mainland China 4 4 It is required for our service providers to maintain confidentiality of our business information. The business agreement will be terminated should there be any breaches in relation to the confidential information leakage and we retain the right to pursue legal action for any loss resulting from the breach. Therefore, to lower the regulatory risks, the Company and the Investment Manager closely monitor news outlet for any ESG non-compliances of our service providers. Privacy and Data Protection We strictly uphold the relevant privacy laws and regulations as well as contractual obligations for the limited privacy data retained by having proper maintenance in a secure place and internal control. The data is only to be used for the purposes upon owners’ agreement and the data will be deleted whenever requested by the owners. When handling the privacy information, employees are instructed to exercise with due care. During the Reporting Period, there were no cases of non-compliance noted in relation to health and safety, advertising, labelling and privacy matters regarding services provided and methods of redress. We also did not receive any services-related written complaints with such practices adopted. Responsible Investment Responsible investment is upheld by the Board and the Investment Manager. It is believed that responsible investment practice is the key to bring long-term sustainable value to our investors and shareholders. Realised that sustainability is becoming an important consideration of investors’ strategic investment decisions with a clear sign that responsible investment is turning mainstream, we do take steps through considering environmental and social criteria when making investment decisions, and not engaging in financing activities which may violate any environmental or labour laws purposefully for profits. A due diligence process is in place when we examine our investment targets. It is important that they are not only performing exceptionally and having good development prospects, but are also fulfilling their ESG responsibility. ESG factors are taken into consideration when we are assessing the risks posed by our investment targets. For example, we would understand their ESG policies and consider if they had any significant ESG non-compliances in the past.