ESG Report 2023

Suitable price, suitable place, suitable quality, suitable quantity and suitable time Contents “ 5S” Principles Supplier Selection Principles Observing the principle of proximity during procurement Purchasing energy-saving products and environmentally-friendly products promoted by the Country Environmental Protection Principles In addition, the Group will confirm whether the suppliers have established health records for their employees and whether they have verified the air purification equipment to identify and promptly eliminate the social and environmental risks of the supply chain. The monthly audits help the Group to further determine the performance and service standard of its suppliers, eliminate inappropriate suppliers, so as to avoid any suppliers without related qualifications or with unstable product quality from entering the supply chain of the Group and affecting the product quality of the Group. The United Laboratories recognizes that enhancing the social and environmental performance of our supply chain is an ongoing process. We encourage suppliers to better understand and effectively manage the impacts they have on society and the environment. In this regard, Inner Mongolia Company has established the "Sustainable Procurement Policy", which emphasizes the need for corporate social responsibility to be reflected in supply chain management. We are committed to gaining a deeper understanding and effectively managing the social and environmental impacts of our production and service procurement operations. The Procurement Department conducts monthly quotation negotiations with qualified suppliers listed in accordance with product categories, based on procurement requests from the production departments. This process enables us to select and utilize suppliers' products and services that minimize adverse effects on society and the environment. We prioritize suppliers who can effectively utilize resources and implement supplier management systems that address environmental and social risks. We encourage the procurement of energy-efficient products promoted by the national government, ensuring the quality of procured products and services, strengthening communication with suppliers, and involving them in research and development activities. We strive to provide energy-saving, green, renewable, non-toxic and harmless, non-polluting, and resource-recycling products for use and promotion across all departments. The United Laboratories hopes that our extensive network of suppliers actively responds to these initiatives, endeavors to improve service standards, and lays the foundation for better cooperation. While complying with legal and regulatory requirements, we expect suppliers to make their due contributions and fulfill their responsibilities to society and the environment. Summary of " Sustainable Procurement Policy " We strive to select and utilize suppliers' products and services in a manner that minimizes adverse impacts on society and the environment, thereby contributing to social well-being. We choose suppliers who can effectively utilize resources and implement robust supplier management systems to address environmental and social risks. We ensure the quality of procured products and services and strengthen communication with suppliers. Where feasible, we provide feedback on their social and environmental performance. 01 We procure and use more energy-efficient products and services that support sustainable procurement practices. We are committed to enhancing suppliers' awareness of sustainable procurement and encouraging innovation by widely adopting new technologies and designs. Throughout our collaboration with suppliers, we adhere to ethical standards and responsible codes of conduct, seeking to establish long-term relationships based on trust and cooperation. 02 58 Environmental, Social and Governance Report 2023 The United Laboratories International Holdings Limited