ESG Report 2021

This production and operation model helps the problems, continue to explore room for improvement, Group to reduce the external demand for major raw and enhance the sustainability of the supply chain. In materials used in the production process, lower the addition, as a raw material supplier for many risk of unstable supply and market price fluctuations antibiotic companies, the Group has been giving the on the supply chain, so that we can effectively highest priority to quality that the pharmaceutical control production costs and ensure product quality. intermediates and bulk medicine produced by the In addition, full control of the supply chain also helps Group have passed many authoritative certifications the Group to retroactively manage the production such as Chinese GMP, EU CEP, and US FDA. process, so as to find the root cause of potential When selecting new suppliers, we conduct a protection, the Group follows the principle of comprehensive evaluation on the suppliers' industrial proximity for procurement. Suppliers are standard, reputation, product price, quality of concentrated in nearby provinces, which effectively samples, etc. based on the internal principles of reduces transportation costs and carbon emissions “5S”, namely suitable price, suitable place, during transportation. At the same time, the Group suitable quality, suitable quantity and suitable time, encourages the selection of suppliers who provide so as to ensure the overall quality and material energy-saving products and environmentally friendly quality of the supply chain. Only the suppliers who products promoted by the state to reduce the impact meet the related requirements can be included in the on the environment. list of qualified suppliers. In terms of environmental equipment to identify and promptly eliminate the We conduct written or on - site audit on the suppliers social and environmental risks of the supply chain. regularly. The audit content includes qualification Regular audits help the Group to further determine certificates, personnel qualifications, environment the performance and service standard of its and factories, equipment quality, material suppliers, eliminate inappropriate suppliers, so as to management, production management, shipping avoid any suppliers without related qualifications or logistics and quality management. In addition, the with unstable product quality from entering the Group will confirm whether the suppliers have supply chain of the Group and affecting the product established health records for their employees and quality of the Group. whether they have verified the air purification Supplier Selection Principles “5S” Principles Observing the principle of proximity during procurement Purchasing energy-saving products and environmentally-friendly products promoted by the Country 53 Contents Environmental Protection Principles Suitable price, suitable place, suitable quality, suitable quantity and suitable time Environmental, Social and Governance Report 2021 The United Laboratories International Holdings Limited Supplier Qualification Supplier Management