ESG Report 2022

8.1 5 Climate Change Coping Mechanisms . Climate Issues More severe extreme weather events Changes in rainfall patterns and extreme changes in weather patterns Sea level rise Climate Issues Physical Risks 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 in input costs Transition Risks The Group actively pays attention to the potential accurately to climate change, we have identified climate-related risks of the business operation, the risks associated with climate change, some and strives to implement energy saving and of which involve potential physical and transition emission reduction measures, as well as risks to production operations and facilities of the formulate contingency plans for environmental Group. Moreover, face increasingly stringent emergencies, so as to mitigate and adapt to the compliance and disclosure obligations, also potential impacts on the business brought by create transition risks for the Group in terms of climate change. In order to respond more legal liability and increased operating costs. As the production base with the largest scale of and Emergency Response Law of the People's the Group, Inner Mongolia Company strives to Republic of China. Inner Mongolia Company reduce the risks brought by climate change by strives to improve the capability of its every s a v i n g e n e r g y a n d wa t e r a n d r e d u c i n g department to prevent, response and handle greenhouse gas emission, with an aim to environmental emergencies among all position contribute to the international community on levels, so as to reduce the risk of loss to mitigating climate change through the efforts of corporate operations due to climate change. The The United Laboratories. Also, Inner Mongolia contingency plan itemizes precautionary Company formulated a contingency plan for measures during flood seasons, which can help environmental emergencies to strengthen the combat floods and other disasters during the preventive and control measures for extreme seasons. The plan also clearly stipulates the weather events and enhancing the coping response plan corresponding units should take capacity. when extreme weather events hit, and the emergency rescue system and procedures The Group has identified climate-related corresponding units should implement to prevent physical risks and taken mitigation measures to the leakage of hazardous materials. If the mitigate their impacts on the business. Inner sewage station is being flooded, relevant M o n g o l i a C o m p a n y h a s f o r m u l a t e d a departments must immediately close the inlet contingency plan for environmental emergencies and drain valves of the sewage station and stop in accordance with relevant laws and regulations the system from operating, so as to prevent of the Country, including Environmental large-scale pollution caused by sewage overflow. Protection Law of the People's Republic of China Low-carbon technology transformation Increase in discharge responsibility Increase in legal liability and compliance costs Increase in costs due to the purchase of carbon emission quota Increased investment in new low-carbon technology development Uncertainties such as higher maintenance costs may be faced Environmental, Social and Governance Report 2022 The United Laboratories International Holdings Limited 71