On June 8th, Winner Medical (300888.SZ) released its “2022 Environmental, Social, and Governance (ESG) Report.” This report is the company’s first ESG report and the third Corporate Social Responsibility report.As an explorer and leader in China’s healthcare industry, Winner Medical has always adhered to the core operating principles of “quality over profit, brand over speed, and social value over corporate value.” It embraces a long-term perspective and continuously improves its performance in the dimensions of environment, society, and corporate governance, and integrates the management of sustainable development-related issues into its strategic layout, business expansion, and risk control.This year’s ESG report provides detailed explanations of Winner Medical’s supervision, evaluation, and management processes regarding environmental, social, and corporate governance matters. It comprehensively showcases the company’s significant progress and major achievements in areas such as promoting inclusive healthcare, building green factories, adhering to responsible marketing, constructing a low-carbon supply chain, and ensuring employee health and safety.

The following are key highlights from the report:

In 2022, Winner Medical consolidated its efforts and made steady progress amid uncertainties. It clarified its “medical + consumer” dual-driven strategy, practiced ESG principles, pursued stable corporate development, and always kept in mind its responsibility to society, contributing to green development.

Winner’s Steady Performance

Economic

Total revenue of RMB 11.351 billion

Net profit attributable to shareholders of listed companies of RMB 1.651 billion

Cash dividends distributed of RMB 798 million

Environmental

Total additional investment in environmental protection exceeded RMB 20 million

Reduced carbon emissions by more than 1,690 tons through equipment upgrading and other measures

Employees

Total investment in employee training amounted to RMB 1.6 million

A total of 5,392 employees received training

Innovation

Total R&D investment of RMB 488 million with 1,588 scientific research team members

As of the end of 2022, a total of 1,149 patents were authorized

Governance Responsibility

Winner Medical continuously consolidates and enhances its corporate governance level, building a scientific, standardized, balanced, and efficient modern corporate governance system.

Corporate Governance

Investor Relations

Information

2021 Annual Report: “Excellent Case Study for the Annual Report of GEM Listed Companies” by the Shenzhen Stock Exchange.

2021 ESG Report: “Excellent ESG Case Study of Listed Companies” by China Association for Public Companies.

Winner Medical was awarded the highest rating of A for companies listed on the Shenzhen Stock Exchange in 2021.

As of the end of the Reporting Period, Winner Medical was rated AAA by Guosen Securities and ranked second out of 110 listed companies in the textile, apparel and luxury industry.

Research and Development Innovation

Winner Medical is comprehensively advancing its research and development innovation process through five technological dimensions: improvement, standardization, digitalization, green energy, and automation.

In October 2022, Purcotton was awarded the National Intellectual Property Advantage Enterprise.

In November 2022, the zero softener eco-gauze bedding set and blanket were awarded Top 10 Innovative Textile Products of 2022.

Intellectual property

Cooperation

The company adheres to innovation as its core competitive strength, promotes precise integration of the innovation chain and industry chain, and drives sustainable high-quality development of the company.

Industry-Academia-Research Collaboration

In 2022, the company established the “Joint Laboratory for Innovative Technology Research on Wound Dressings” with the Shenzhen Institute of Advanced Technology, Chinese Academy of Sciences.

In 2022, the company carried out nine standard-setting initiatives, of which three standards were released and implemented.

Supply Chain Collaboration

Low carbon environmental protection

Winner Medical adheres to the concept of sustainable operation and is committed to developing an environmentally friendly and resource-saving circular economy.

Carbon emission management

In August 2022, Purcotton was awarded the ISO 14067 Product Carbon Footprint Verification Declaration Certificate for its 100% cotton soft tissues, baby wipes and baby gowns, making it the first brand in China receiving SGS Product Carbon Footprint Certification in the above categories.

Green packaging

The Company proactively promoted the “de-plasticization” strategy. In the medical business segment, through technology innovation, the Company first adopted dialysis paper film instead of plastic film in the packaging of medical products, taking the lead in the industry to chieve “paper packaging” and realize the de-plasticization of product package. During the Reporting Period, eight products in the medical protective mask category adopted “paper packaging”, with cumulative sales reaching 300 million.

In the consumer products business segment, 1,458 products in more than 30 categories were de-plasticised and packaged during the Reporting Period, including the main products such as baby super soft cotton tissues, gauze bath towels and sanitary napkins.

Empowering Employees

Employees are the talent guarantee for the development of a company, and Sturdy Medical always adheres to the employment philosophy of “high quality, high efficiency, high performance, and high returns,” striving to achieve the mutual enhancement of individual and corporate values.

Employee Development

The company has formulated the “Win Series” talent development program, which includes diverse training programs such as the Spring Seedling Training Camp, onboarding training for new employees, and professional advancement.

Employee care

The Company cares for employees and constantly improves the employee benefit system while ensuring their statutory benefits. The Company has set up four benefit sections, namely “Win Energy”, “Win Honor”, “Win Care” and “Win Vitality”. Through such diverse multi-level employee care system, the Company has been able to enhance employees’ sense of well-being, their sense of belonging and their identification with the Company.

Value Transmission

In 2022, we contributed our efforts in areas such as epidemic prevention and control, education and healthcare, poverty alleviation, and social assistance, working together to build a harmonious and caring society.

Building the “Power of a Cotton Flower” Public Welfare IP

Through the “Power of a Cotton Flower” brand image in public welfare, the company conveys the spirit of cotton and positive energy through three main avenues: humanistic art, philanthropic donations, and environmental protection. It aims to promote the concept of sustainable development in various dimensions.

The company carries out activities such as the “Peaceful Package” donation campaign, the “Giving for Coexistence” marine protection event, and the production of an original documentary series titled “What She Changes” that highlights the power of women. These initiatives express the brand’s philanthropic attitude of contributing its “cotton power” to the world.

Public Welfare Actions

In 2022, the company established the “Winner” Charity Association internally, actively assisting employees facing difficulties. Externally, the company carried out multiple donation activities, with a total donation amount of 18.6 million yuan throughout the year.