Environmental Aspects
TCFD
1. Climate Change Response
We pay attention to the impact of climate change on the sustainable development of the Company and actively introduce climate risk management mechanisms to reduce operational impacts and enhance corporate resilience. The Company strengthens its climate governance structure, improves its carbon reduction and energy management capabilities, and promotes GHG inventory to ensure that its operations are on par with the ESG development trends.
1. 1 Climate Governance
To ensure that climate change issues are integrated into its sustainable business strategy, Jia Jie Biomedical
Co., Ltd.'s Board of Directors and Sustainability Development Committee have adopted the Task Force on
Climate-related Financial Disclosures (TCFD) framework, issued by the Financial Stability Board (FSB),
starting in 2023. The company has established a mechanism to identify climate-related risks and
opportunities, thereby enhancing the assessment and management of potential impacts of climate change on
its operations.
In 2024, Jia Jie Biomedical Co., Ltd. further strengthened its climate governance mechanisms. Through internal review mechanism and periodic climate risk monitoring in collaboration with external experts, the Company has integrated climate risk management into its financial decision-making. In addition, the Company has established greenhouse gas inventory standards and actively implemented energy-saving and carbon reduction projects, as well as supply chain emission reduction strategies, to enhance overall operational resilience.
Looking ahead to 2024 and beyond, Jia Jie Biomedical will continue to deepen its climate governance efforts and is committed to completing full TCFD disclosure by 2027. This commitment will ensure that the Company's business model aligns with international sustainability standards and adapts to evolving market and regulatory requirements, thereby laying a solid foundation for long-term competitiveness and sustainable growth.
Board of Directors and Sustainability Development Committee
Head of the highest governance body for Jia Jie Biomedical’s climate governance: Chairman (responsible for overseeing the overall sustainable development policies)
Highest decision-making officer for sustainable development strategies: President (responsible for determining the strategic direction and key topics for sustainable development)
On November 12, 2024, following a resolution by the Board of Directors, Jia Jie Biomedical formally established the Sustainable Development Committee to strengthen ESG (Environmental, Social, and Governance) management mechanisms and to ensure the effective implementation of the Company's sustainable development goals and strategies.
The Sustainable Development Committee is responsible for formulating Jia Jie Biomedical Co., Ltd.'s sustainable development strategies, overseeing ESG performance, and assessing the impacts of external risks and internal governance to ensure the parallel advancement of sustainable operations and corporate growth. The Committee convenes two climate risk review meetings annually. In 2024, the Board of Directors reviewed and approved newly established or amended climate-related targets.
Sustainable Development Management Framework
Jia Jie Biomedical has established five ESG teams responsible for executing sustainability-related initiatives and projects, ensuring that ESG policies are effectively incorporated into daily operations.
1.Corporate Governance Team:
Responsible for optimizing the Company's internal climate governance mechanisms. In 2024, a climate financial risk assessment process was introduced to ensure the integration of climate governance with corporate operational decision-making.
2.Employee Care Team:
Pay attention to employee health and climate adaptation measures. In 2024, periodic health checkups for all employees were implemented to ensure workplace safety and health under extreme climate conditions.
3.Environmental and Supply Chain Sustainability Team:
Responsible for assessing the impact of climate change on Company operations and formulating mitigation strategies. The team also completes a carbon emission inventory and monitored carbon emission hotspots every year to ensure that the Company is moving towards its low carbon and energy transformation goals.
4.Social Care Team:
Responsible for promoting social welfare, community engagement, and corporate social responsibility (CSR) projects.
5.Customer Relations Team:
Responsible for managing customer relationships, information security and customer privacy, network quality, digital inclusion, and innovation.
In 2024, the Sustainable Development Committee advanced the. Company's climate governance mechanisms through ESG meetings and alignment with international standards, laying a solid foundation for achieving future key objectives. Looking ahead, in 2025, the Company plans to continue replacing outdated, high-energy-consuming equipment, introduce high-efficiency energy-saving facilities, and expand the installation of solar energy and other energy storage systems, steadily progressing toward energy transition and carbon emission reduction goals.
1. 2 Climate Risk Management
Mechanism for Identifying Climate Risks and Opportunities
Every year, we assess the risks and opportunities of the Company’s operations arising from climate change through ESG meetings, supply chain climate impact assessments, and analysis of industry benchmarks. The analysis results are submitted to the Sustainable Development Committee and the Board of Directors to formulate response strategies.
Climate Risk Management Process
1.Collection and analysis of climate risk data:
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Keep abreast of climate trends and regulatory changes through government regulations, international ESG standards, and peer reports
2.Climate impact assessment and financial impact analysis:
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Discussion of the impact of extreme climate on the enterprise’s supply chain, energy management, and operating sites
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Predict the financial risks and opportunities that may arise from climate change.
3.Formulate strategies for carbon reduction and risk response:
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Propose carbon reduction technology application, energy-saving equipment upgrade, green power procurement and other action plans for high-risk areas.
4.Supervision and execution and performance tracking:
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Evaluate the effectiveness of the Company’s carbon reduction actions through KPIs and regularly review and adjust strategies.
Climate Risk Management Action Plan
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Enhance the climate risk monitoring mechanisms: Establish a climate risk database to ensure information transparency.
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Reinforce the climate adaptation capability of the supply chain: Ensure a sustainable supply chain.
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Promote energy saving and carbon reduction technology applications: Increase the use rate of green power, and reduce Scope 1 and Scope 2 carbon emissions.
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Introduce the climate financial risk assessment mechanism: Perform climate risk financial impact analysis in accordance with TCFD requirements.
Collect issues
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Industry sustainability report issues
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International trends
Identify risks
and opportunities
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Visit various units
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Score risk and opportunity issues by the Company’s colleagues
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Inventory the current status of the operating sites and formulate management measures based on the risk and opportunity of the sites
Formulate
countermeasures
Tracking
management
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Submit the goal achievement status by each relevant unit to the sustainable development team each year
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Review the goal achievement status every quarter
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Submit the identified risks and opportunities and the implementation results to the Board of Directors every year.
1. 3 Climate Change Response Strategies
To formulate the Company's key climate change strategies, it is first necessary to identify the critical climate-related risks and opportunities each year. In 2024, following the TCFD guidelines and considering industry development trends and international policy changes, the Company collected and analyzed climate-related issues relevant to Jia Jie Biomedical's operations. In addition, through discussions between the Sustainable Development Team and department heads, the Company assessed the actual risks and opportunities faced and developed corresponding adaptation and response measures.
As a result, the Company identified eight key climate-related risks and opportunities, including two transition risks (such as rising raw material costs and changes in labeling and packaging regulations), three physical risks (such as supply chain disruptions caused by extreme weather events, changes in rainfall patterns and water resource risks, and rising temperatures), and three climate opportunities (such as improving production and distribution efficiency, adopting low-carbon energy, and developing low-carbon products and services). These risks and opportunities respectively impact short-term (1-3 years), medium-term (3-5 years), and long-term (over 5 years) operational development, and will have varying degrees of influence on the Company's financial structure, supply chain stability, and product competitiveness. Accordingly, the Company has developed concrete response strategies to mitigate operational impacts and catch market transformation opportunities. The following presents the detailed results of the risk and opportunity identification:
I. Transition Risks
1.Rising raw material costs
Description: Jia Jie Biomedical's product formulations primarily use natural ingredients. Due to the impacts of climate change, the costs of agricultural and animal-based resources are rising, and supply disruptions may occur.
Impact Period: Medium-term (3–5 years)
Likelihood of Occurrence: High
Financial Impact Level: Medium
Jia Jie Biomedical’s Planned Response Measures:
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Strengthen R&D capabilities to reduce dependence on a single raw material
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Sign long-term contracts with suppliers to ensure stable supply
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Develop alternative materials, such as plant-based or synthetic ingredients
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Establish strategic reserves to mitigate the effects of market fluctuations
2.Changes in Labeling and Packaging Regulations
Description: Environmental regulations in various countries are becoming more stringent, such as requirements for carbon footprint labeling and the use of eco-friendly packaging materials. Companies must promptly adjust to comply with regulatory demands.
Impact Period: Short term (1-3 years)
Likelihood of Occurrence: High
Financial Impact Level: Low
Jia Jie Biomedical’s Planned Response Measures:
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Monitor the market regulation status.
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Establish mechanisms for rapid adjustment of product labeling and packaging.
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Develop sustainable packaging solutions to enhance the brand’s eco-friendly image.
II. Physical Risks
1.Changes in rainfall patterns and the impact of extreme weather
Description: Extreme weather events such as droughts and floods lead to water resource instability, affecting production and plant operations, and increasing health risks for employees.
Impact Period: Medium-term (3–5 years)
Likelihood of Occurrence: High
Financial Impact Level: Medium
Jia Jie Biomedical’s Planned Response Measures:
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Establish a supply chain contingency plan to diversify suppliers and reduce risk.
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Install a 24-hour uninterruptible power supply (UPS) system at headquarters.
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Build water storage tanks to address water shortage risks
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Install rainwater harvesting systems to reduce dependence on tap water.
2.Supply chain disruptions (impacts of extreme weather)
Description: Typhoons, floods, and droughts affect the supply chain, resulting in unstable raw material supply or rising costs, which impact production and delivery capabilities.
Impact Period: Short term (1-3 years)
Likelihood of Occurrence: High
Financial Impact Level: Medium to High
Jia Jie Biomedical’s Planned Response Measures:
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Diversify suppliers to reduce reliance on a single source.
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Establish strategic raw material reserves.
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Develop alternative materials.
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Strengthen climate risk monitoring to proactively address climate impacts.
3.Rising average temperatures
Description: Rising temperatures increase the demand for cooling equipment, leading to higher energy consumption and operating costs.
Impact Period: Medium-term (3–5 years)
Likelihood of Occurrence: High
Financial Impact Level: Medium
Jia Jie Biomedical’s Planned Response Measures:
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Regular maintenance, inspection and replacement of air-conditioning equipment, to improve operating efficiency and reduce the incidence of failure.
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Continue to implement and introduce various energy-saving management measures.
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The air-conditioning system is deployed and controlled. The indoor temperature is adjusted by setting up the air-conditioning temperature in office above 25 ºC or opening the windows.
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Promote greening and shading measures: Reduce indoor temperatures and lower air conditioning demand through tree planting, rooftop insulation, and external wall shading designs.
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Improve equipment energy efficiency: Replace high-energy-consuming equipment with energy-efficient cooling and lighting systems to reduce electricity consumption.
III. Opportunities
1.Enhancing production and distribution efficiency
Description: By improving production yield rates and on-time delivery rates, the Company aims to increase customer willingness to place orders, boost sales volume and product quality, and drive revenue growth.
Impact Period: Medium-term (3–5 years)
Likelihood of Occurrence: High
Financial Impact Level: Medium
Jia Jie Biomedical’s Planned Response Measures:
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Increase waste recycling rates and promote circular economy practices.
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Consolidate shipments to reduce logistics costs.
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Replace outdated equipment to enhance operational efficiency.
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Safety stocks are adopted for controlling the raw materials, to reduce the need for individual orders due to emergency needs.
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Continue to strengthen the ratio of local procurement and production of raw materials.
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Adopt smart production management: introduce automation and data analytics technologies to improve production efficiency and reduce energy consumption.
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Promote supply chain carbon footprint assessment: collaborate with suppliers to evaluate and reduce carbon emissions across the supply chain and enhance overall environmental benefits.
2.Adoption of low-carbon energy
Description: Currently, the main energy sources used in the plant are electricity and diesel. Jia Jie Biomedical is evaluating the adoption of low-carbon energy sources to reduce carbon emissions.
Impact Period: Medium-term (3–5 years)
Likelihood of Occurrence: Medium
Financial Impact Level: Medium
Jia Jie Biomedical’s Planned Response Measures:
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Plan to expand the total capacity of solar power generation.
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Introduce energy storage technologies to reduce peak power demand.
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Participate in the electricity market to enhance future flexibility.
3.Development of Low-Carbon Products and Services
Description: The growing trend toward environmental protection is driving market demand. Jia Jie Biomedical is launching low-carbon products to respond to market needs, creating opportunities for sales growth.
Impact Period: Medium term (3–5 years)
Likelihood of Occurrence: High
Financial Impact Level: Medium
Jia Jie Biomedical’s Planned Response Measures:
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Increase the use of eco-friendly packaging materials (e.g., low-carbon cartons) to reduce the carbon footprint of products.
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Develop low-carbon products to meet the market demands.
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Promote carbon reduction across the supply chain and encourage suppliers to adopt low-carbon manufacturing processes.
This report comprehensively assesses the risks and opportunities faced by Jia Jie Biomedical and provides corresponding management strategies to ensure the Company maintains its advantage in sustainable development and market competitiveness.
1. 4 Indicators and Goals
Since 2022, we have voluntarily inventoried the Scope 1 (direct emissions) and Scope 2 (indirect emissions) of GHGs at Meinong Plant. In 2023, we expanded the scope of inventory to the headquarters, branches, and the Research and Training Center to fully disclose relevant data in the sustainability report. In 2024, the Company further optimized its climate change management strategy, increased the carbon reduction action implementation, and strengthened supply chain resilience to cope with the challenges brought by extreme climate risks.
In 2024, the Company strengthened its climate governance mechanism through the establishment of the Sustainable Development Committee, regularly monitored the climate action progress of each site, and gradually implemented a GHG reduction plan, hoping to achieve a more active low-carbon production goal by 2030.
Climate Action Targets
New Goals and Reinforcement Actions
To strengthen climate action, the following climate management targets have been added to gradually implement GHG reduction, energy conservation management, and low-carbon transition strategies:
