Responsible Supply Chain-Zijin Mining Group Co., Ltd.

Responsible Supply Chain

With the vision “to become a globally respected producer of green metals”, Zijin Mining requires its suppliers to conduct their business in a responsible and ethical manner and ensure that their relevant policies on ethics, safety, health, environmental protection, human rights and among others are generally aligned with Zijin’s standards. They are also required to share Zijin’s fundamental cultural beliefs. These are prerequisites for building business partnership with us.

UN Sustainable Development Goals

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UN Global Compact

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Targets and Progress

By 2023, the local procurement rate in the host countries will reach 70%

80.33%

Local procurement rate in the host countries was 80.33%
57.29%

57.29% of current suppliers passed ESG reviews.
1523

1523 new suppliers passed ESG reviews.

Our Policies

We reviewed and put management policies in place such as the “Supplier Management Measures, "Supplier Code of Conduct”, “Policy Statement on Whistleblowing Management”, “Policy Statement on Supplier Management" and “Policy Statement on Business Ethics Management”. These efforts are to ensure that suppliers conduct their business responsibly and ethically, as well as align their ethical, safety, health and human rights guidelines and social and environmental performances with those of Zijin Mining.

Supplier Code of Conduct

We are committed to conducting our business in a professional, honest, and ethical manner. We are committed to always following the highest levels of legal, regulatory and ethical standards to avoid negative influences on our integrity and reputation.

Zijin Mining formulates our Supplier Code of Conduct (the “Code”) with reference to international standards and our Corporate Code of Conduct, with the aim to align ESG performance of our suppliers, contractors, and business partners with Zijin Mining’s. We expect our partners to abide by the Code. Any violation of the Code may damage their business relationship with Zijin Mining, or even lead to the termination of cooperation.

Our suppliers and partners should conduct business under the following codes:

Comply with the laws, rules and regulations

Complying with all applicable laws and regulations in host countries/regions is a prerequisite for establishing cooperative relationships with Zijin Mining.

Practice business ethics

Legally handle trade secrets, patent, trademark, copyright, engineering data, databases, customer information, salary information and any confidential financial data and reports, etc.

Committed to fair, transparent and honest cooperation and competition. Establish a sound management system of business ethics and supervision. Prevent the practice of unfair competition and corruption. Prohibit from obtaining competitive advantage by false information or other fraudulent means.

Prohibit from any forms of corruption, such as offering or accepting bribes. Prohibit from intervening stakeholders by entertaining them, offering kickbacks or gifts.

Establish grievance and whistle-blower protection mechanism to prevent any form of retaliation against the whistle-blower.

Protect the environment and practice green procurement

Enhance the awareness of environmental protection. Actively promote ISO14001 EMS certification.

Prevent pollutions from gas, water, and noise in operation and production.

Protect the ecological environment. Use production techniques, raw materials and energy with less negative impacts on the environment. Actively practice energy conservation, GHG emission reduction, resource reuse, etc.

Promote a circular economy policy based on efficient use of resources and environmental protection.

Reduce packaging materials and reuse packaging. Packaging using recycled materials, renewable materials or biodegradable materials; Use green design and safety warning in packaging.

Promote clean production by waste recycling and improving technique.

Protect the human rights of labours

Prohibit from using child labour and any form of forced labour. Respect and protect the basic rights of employees.

Prohibit from slavery and forced labour. Ensure working hours are under the limit prescribed by relevant laws and regulations.

Respect and treat employees equally. Oppose any behavior that can be perceived as bullying, intimidation, harassment, or discrimination in workplace. Prohibit discrimination in hiring or promotion on the basis of race, religion, age, nationality, gender, marital status, pregnancy, etc. Do not ask employees or applicants to take medical test of a discriminatory nature.

Respect the legal rights of free association and collective bargaining of employees.

Ensure the welfare of employees in terms of salary, vacation, and social security.

Provide safe and health workplace and services

Actively promote ISO 45001 OHS management system certification. Improve employees' safety and health awareness. Encourage employees to work in a safe and responsible way.

Establish a safe working environment. Prevent employees from occupational hazards, Standardize occupational health monitoring.

Conduct safety risk assessment for all construction and operation activities. Work in strict accordance with safety operation procedures.

Develop the ability to deal with emergencies such as natural disasters, production accidents and environmental pollution to minimize casualties, environmental and social impacts.

Engage the community with respect

Respect the culture, traditions and beliefs of the community in which we operate. Respect indigenous people’ rights of free, prior and informed consent.

Establish an appropriate communication and grievance mechanism in the community. Pay attention to their concerns and properly solve reasonable appeals.

When operating in conflict affected and high-risk areas (CAHRAs)

Prohibit from directly or indirectly assisting or facilitating the implementation of:

Any form of torture, cruel, inhuman and degrading treatment;

Any form of forced or compulsory labour with the threat of punishment;

Any form of involuntary extraction of individuals for labour or services;

Any form of child labour;

Other serious violations and abuses of human rights, such as sexual violence;

War crimes or other serious violations of international humanitarian law, such as crimes against humanity or genocide.

Prohibit from direct or indirect support to illegal organized armed groups and public or private security forces.

Prohibit from bribery, corruption and money laundering in all business activities and transactions.

Responsible Supply Chain Management

We are committed to not procuring, processing or selling conflict minerals and have passed the audit of London Bullion Market Association (LBMA). During the reporting period, we built a responsible supply chain system with broader coverage based on the OECD Five-Step Framework, the requirements of the London Metal Exchange (LME) responsible sourcing policy and the "Chinese Due Diligence Guidelines for Responsible Mineral Supply Chains". We also proactively require subsidiaries that produce “Zijin” brand copper cathode and raw materials for zinc bullion to carry out due diligence investigation.

We implement responsible supply chain management centered on smelters. Upstream mines are required to carry out stewardship management and urged to fulfil their social responsibilities. Self-operated mines are required to build comprehensive ESG systems. Smelters cooperate with downstream parties to carry out due diligence and provide due diligence and stewardship information, together building a responsible mineral supply chain.

Supplier Onboarding Assessment

We advocate for establishing long-term and stable cooperative relationships that are based on integrity with suppliers. By setting up a regular management-level communication mechanism with suppliers, we aim to raise suppliers’ awareness of fulfilling social responsibilities, and by doing so, pushing forward the building of responsible supply chains:

We have stringent regulations on supplier assessment and onboarding in accordance with the Company’s “Measures for the Management of Suppliers”, and rate suppliers based on three aspects: environmental protection, social responsibility and corporate governance. Suppliers have to go through on-site visits and pass organized reviews in order to be finally accepted in our supplier list.
To ensure that suppliers’ ethical, safety, health and human rights guidelines are aligned with ours, and that their social and environmental performances are qualified, we have included in the standard purchase agreements signed by the suppliers a clause requiring compliance with our Supplier Code of Conduct.
We manage our global suppliers on the Yizhi Procurement Portal. On this same platform, we share Zijin Mining ’s sustainability philosophy, integrity policy, environmental protection philosophy, green procurement policy, etc. To ensure effective learning and that our suppliers follow our policies and philosophies, each supplier can only register, submit quotations and conduct other relevant activities after they complete a learning course of our company policies and philosophy.

We take into consideration country-specific risks and sector-specific risks in our supplier screening process.

Environmental Assessment Elements	Social Assessment Elements	Governance Assessment Elements
● Environmental Management System and Policies ● Energy Consumption and Carbon Emissions ● Environmental Pollution Violations and Fines ● Production Environment ● Environmental Protection Measures	● Engagement in Public Affairs ● Labor Rights Policies ● Negative Public Opinions from the Society ● Production Safety	● Compliance and Anti-Corruption Policies ● Information Disclosure and Transparency ● Business Ethics Controversies and Violations

We have included the requirements for compliance with our Corporate Code of Conduct in our suppliers’ standard procurement agreements in an effort to make sure that their ethics, safety, health, and human rights principles, as well as social and environmental performance are consistent with ours.

Risk Assessment and Review

We conduct reviews to ensure the authenticity and legality of our suppliers’ qualifications and credibility. We generally organize a concentrated evaluation of suppliers quarterly and conduct a comprehensive annual assessment. Daily management involves irregular checks through the national business information system, collecting internal and external feedback, and processing complaints and reports received through company compliance channels. After investigation and verification, we evaluate supply chain risks accordingly. Additionally, we perform necessary audits on suppliers and contractors based on risk factors, either through internal audits or by hiring external auditors.

We review and assess the business responsibility practices of every supplier at least once a year, based on their risks in environment, safety, and social responsibility. Measures will be taken as a result of the assessment. Suppliers found in serious violation of the contract or law will be blacklisted for 1-3 years. Suppliers with major quality problems, significant safety and environmental protection risks, bribery, or being blacklisted for poor production and operation safety records by governments at all levels will be directly removed from our supplier list and permanently banned.

Communication with Suppliers

We advocate establishing long-term, stable cooperative relations with our suppliers based on sincerity, and we have established a periodical communication mechanism with suppliers to improve their awareness to perform their duties. Besides, we provide suppliers and contractors with relevant policies and rules on responsible supply chains in the forms of websites and contracts, and we keep necessary communication and convene meetings when necessary on their responsibility and performance.

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