Social
Supplier Management Process

Dajin Heavy Industry has included social responsibility and ESG compliance audits in its key considerations for new supplier admission and regular supplier assessment. With reference to the Supplier Assessment Form, the Company scores suppliers on the prohibition of child labour, forced labour, business ethics, environmental protection, and employee health and safety during new supplier admission and supplier assessment, and comprehensively evaluates suppliers’ ESG performance. Prior to cooperation, agreements such as the Agreement on Environmental, Occupational, Health, and Safety Management of Relevant Parties and the Integrity Agreement are signed to set requirements for suppliers’ behaviours in clean production, health and safety, business ethics, and other behaviours. In case of violation of the relevant agreements during the cooperation, the Company will reduce the procurement amount, suspend, or terminate the cooperation with the relevant suppliers depending on the severity.

Supplier Management System

During the supplier admission stage, if serious ESG-related non-conformities are found, after comprehensive assessment, the Company will provide rectification suggestions to the supplier and require them to complete rectification within a specified time and submit a written rectification report. During the rectification period, the Company will suspend signing new purchase orders with them.

Supplier audit

For suppliers that have already established cooperation with the Company, we regularly conduct online and offline audits. If any non-conformities related to ESG are found, the Company will require suppliers to complete rectification within one month and provide written evidence of their rectification efforts. Meanwhile, the Company will verify the effectiveness of the suppliers’ rectification measures. If they do not meet the rectification requirements, suppliers will be required to continue with their rectification efforts.