ESG Report 2021

Inner Mongolia Company actively responds to the higher than the free quota, the quota gap was national carbon emission plan and participates in the approximately 25.64% and 14.49% of the current verification to verify its carbon emission. During the year's emissions, respectively, with significant Year, Inner Mongolia Company opened an account improvement. During the Year, Inner Mongolia for carbon trading and opened different systems, Company conducted the first carbon trading for the including the national carbon emission registration quota gap in 2019 and 2020, paid approximately system and trading system, and the national RMB30,000,000, paid the quota for 2 years and voluntary emission reduction registration system and completed the performance cycle. In the meantime, trading system, which laid the foundation for Inner Mongolia Company proactively reduced contract performance. In 2019 and 2020, although emissions by promoting the work of the carbon the emissions of Inner Mongolia Company were trading quota in 2021. Align with Country The Group actively pays attention to the potential identified the risks associated with climate change, climate-related risks of the business operation, and some of which involve potential physical and strives to implement energy saving and emission transition risks to production operations and reduction measures, as well as formulate facilities of the Group. Moreover, tightened contingency plans for environmental emergencies, so compliance and disclosure obligations, also create as to mitigate and adapt to the potential impacts on transition risks for the Group in terms of legal the business brought by climate change. In order to liability and increased operating costs. respond more accurately to climate change, we have Responding to Climate Change 70 Environmental, Social and Governance Report 2021 The United Laboratories International Holdings Limited Climate Issues More severe extreme weather events Increase in discharge responsibility Transition Risks Increased investment in new low-carbon technology development Uncertainties such as higher maintenance costs may be faced Increase in legal liability and compliance costs Increase in costs due to the purchase of carbon emission quota More severe extreme weather events Sea level rise Changes in rainfall patterns and extreme changes in weather patterns Climate Issues Potential natural disasters, resulting in transportation difficulties, damage to facilities, increased capital and operating costs Possible exposure to increase in insurance premium Possible decrease in the amount of water or other raw materials, resulting in an increase input costs Physical Risks