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

Responsible Supply Chain

With a 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 aligned with Zijin’s standards. They are also required to share Zijin’s fundamental cultural beliefs. These are our 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, local procurement in host countries will reach 70%

80.33%

Local procurement in host countries stood at 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, including our: “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 policies were made 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’s.

Supplier Code of Conduct

We are committed to conducting our business in a professional, honest, and ethical manner. We endeavor to always follow 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’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 guidelines:

Comply with 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.

Uphold business ethics

Legally manage trade secrets, patents, trademarks, copyrights, engineering data, databases, customer information, salary details, and any confidential financial data and reports.

Commit to fairness, transparency, and integrity in all business cooperation and competition. Develop and maintain a robust system for managing and supervising business ethics to prevent unfair competition and corrupt practices. Prohibit the use of false information or other deceptive methods to gain an unfair competitive edge.

Avoid any form of corruption, including the giving or receiving of bribes. Prohibit from influencing stakeholders' decisions by offering entertainment, kickbacks, or gifts.

Establish a mechanism for grievances and whistleblower protection to ensure that whistleblowers are not subjected to any form of retaliation.

Protect the environment and practice green procurement

Raise environmental awareness and actively encourage ISO 14001 Environmental Management System certification.

Prevent environmental pollution from harmful gases, liquids, and noise resulting from production and daily activities.

Protect the natural environment by using environmentally-friendly production processes, materials, and energy sources. Focus on energy efficiency, emission reductions, and resource recycling.

Advocate for a circular economy based on resource efficiency and environmental protection.

Reduce and reuse packaging materials; use packaging made from recycled or renewable materials; use biodegradable packaging. Implement environmentally-friendly packaging designs and include safety warnings.

Promote clean production and waste recycling through technological improvements.

Safeguard labor rights

Prohibit the use of child labor and all forms of forced or compulsory labor. Respect and protect the fundamental rights of employees.

Eliminate all forms of slavery and forced labor, ensuring work hours do not exceed legal limits.

Treat all employees with respect and equality. Actively discourage and combat discrimination, bullying, intimidation, and harassment in the workplace. Ensure there is no discrimination in hiring or promotion based on race, religion, age, nationality, gender, marital status, pregnancy, etc. Prohibit from requiring employees or job candidates to undergo discriminatory medical tests.

Recognize and respect employees' legal rights to freely associate and engage in collective bargaining.

Ensure employees' rights to fair wages, benefits, vacation time, and social insurance are protected.

Provide safe and healthy services and work environment

Actively promote ISO 45001 Occupational Health and Safety Management System certification. Enhance employees' awareness of safety and health issues while training and encouraging them to work safely and responsibly.

Create a safe work environment and prevent occupational health hazards. Standardize occupational health monitoring.

Perform safety risk assessments for all construction and operational activities, adhering strictly to safety protocols.

Develop capacity to manage emergencies such as natural disasters, production safety accidents, and pollution incidents, aiming to minimize human casualties, environmental damage, and social impact.

Respect the communities

Respect the culture, traditions, and beliefs of the communities in which we operate. Honor the participation and the right to be informed of the Indigenous peoples.

Establish effective communication and grievance mechanisms within the community. Take their concerns seriously and respond appropriately to grievances.

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

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

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

Any forms of forced or compulsory labour, which means work or service which is exacted from any person under the menace of penalty and for which said person has not offered himself voluntarily;

The worst forms of child labour;

Other gross human rights violations and abuses such as widespread sexual violence;

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

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

Prohibit 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” branded 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 our “Measures for the Management of Suppliers”, and rate suppliers based on three aspects: environmental protection, social responsibility and corporate governance. Suppliers must 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 these assessments. 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 have established a periodical communication mechanism with suppliers to maintain clear awareness of their responsibilities. On top of this, we provide suppliers and contractors with relevant policies and rules for responsible supply chains in the forms of websites and contracts, keeping proper communication and calling meetings on their responsibility and performance when necessary.

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