Sungrow has incorporated sustainability into the whole process of purchasing business, including supplier entry management (supplier screening, supplier selection, and supplier verification), and supplier development management (supplier performance appraisal management, and supplier exit management, etc.).
For supplier entry, the company follows the Responsible Business Alliance (RBA) Code of Conduct, ISO 14001, ISO 45001, SA8000, and relevant environmental and social laws and regulations to assess whether suppliers meet the required qualifications. Due diligence is also conducted on suppliers. Additionally, suppliers are required to sign agreements including the "Integrity Agreement" and "Supplier Code of Conduct." Manufacturers must also sign the "Supply Chain Origin Information Declaration."
The supplier development management process incorporates an appraisal mechanism to ensure a fair and scientific sourcing. Before the appraisal, based on the Supplier ESG Assessment Report, the company evaluates the supplier's ESG performance against dimensions such as environmental protection, labor management, business ethics, and management of critical minerals, the evaluating results will serve as one of the basis for the appraisal. For existing suppliers, Sungrow entrusted independent accredited auditing bodies to conduct annual ESG assessment to enhance transparency.
Regarding the control of hazardous substances in the supply chain, Sungrow manages the introduction process of hazardous substances from both the supplier and material dimensions. The control methods include agreements, on-site audits, material testing, performance evaluation, etc. In response to the requirements of the EU Battery Regulation released in 2023, the company has revised the Environmental Commitment Letter and formulated a new supplementary agreement to the environmental commitment Letter, and requires all relevant suppliers to sign and confirm.
