Wang Tai : Financial Statements/ESG Information - ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT

宏太控股有限公司

Wang Tai Holdings Limited

(Incorporated in the Cayman Islands with limited liability)

(Stock Code: 1400)

2016

ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT

Wang Tai Holdings Limited Environmental, Social and Governance Report Contents

1. About the Report 3

2. Corporate Governance 3

3. The Group's Efforts in Environmental Protection 4

4. Use of Resources 7

5. Employees and Safety 9

6. Customers, Suppliers and Product Responsibility 12

7. Anti-Corruption 14

8. Community Involvement 14

1. About the Report

   Nowadays, environment and climate issues have attracted worldwide attention and ways to cope with the environmental and climate changes are ever-increasing challenges to the society. Since the effectiveness of the "Paris Agreement" on November 4th 2016, nations are taking various carbon-emission-reduction methods to prevent worsening climate changes. To fulfill its corporate responsibilities and protect the environment, Wang Tai Holdings Limited (the "Company" and together with its subsidiaries, the "Group") is committed to incorporating environmental protection and corporate responsibilities into its development strategies so as to achieve sustainable development of the company, society and environment.

   Standard and Scope of the Report

   This Environmental, Social and Governance (the "ESG") Report (the "Report") is composed pursuant to the ESG Reporting Guidance issued by The Stock Exchange of Hong Kong Limited (the "Stock Exchange"). It is the first ESG Report of the Company and its contents include the methods and results of the ESG activities the Group took during the period from January 1st to December 31st 2016, and the Group's efforts in areas such as working environment, environmental protection, operating rules and community involvement. Data in the Report is based on the documents and statistics of the Group. The production of this Report is supported by the management of the Group. We express our sincere gratitude to all parties that have contributed to the Report and the activities of the Group in relation to environment, society and corporate governance. Enquiries and advices are welcomed in order to continuously improve the Group's activities in relation to environment, society and corporate governance.

2. Corporate Governance

   The Company has adopted the Corporate Governance Code (the "CG Code") contained in Appendix 14 to the Rules Governing the Listing of Securities on the Stock Exchange (the "Listing Rules") as its own code of corporate governance.

   The Company principally engages in the design, research and development, production and sales of fabrics and yarns. Established in 2004, the Company was listed on The Stock Exchange of Hong Kong Limited in 2014. After over a decade of development, the Group has formulated an effective corporate structure. The Company has complied with applicable terms in the CG Code, and is committed to achieving high standards of corporate governance to safeguard the interests of shareholders and to enhance corporate value and accountability. The Company acknowledges the important role the Board of Directors (the "Board") plays in providing effective leadership and direction to its business, and ensuring transparency and accountability of its operations. The Group plans to invest in Iron Mining International to broaden its business and improve its operating conditions, in order to achieve diversified development.

   The Group is dedicated to its business development and innovation, placing priority in the research and development capacities in order to meet the demand of the market and clients. The following awards and patent received by the Group during the year 2016 indicate the acknowledgements from the market, clients and government.

   Type	Item
   Awards	Fabrics China Appraisal Entry Enterprise (中國流行面料入圍獎)
   	Quanzhou Technology Enterprise Award (泉州市科技創業獎)
   	Communist Youth League Shishi Committee May Fourth Red Flag Branch (共青團石獅團委五四紅旗團支部)
   Patent	A warp technology for uniaxially weaving double-layer fabric (一種雙層織物面料單軸織造的輕紗工藝) Patent Registration No.: ZL201410674681.X

3. The Group's Efforts in Environmental Protection

The Group well acknowledges the significant influences corporate development poses on the society. It considers environmental protection and sustainability as core elements of its corporate development and seeks to raise its employees' environmental awareness. The Group is considering the possibility of adoption of environmental protection technology to recycle the waste materials during the production process. If the adoption becomes feasible, the Group can save the wastage during the production process to slim down the production cost.