We have established a talent pool management system. Through our new employee training program and mentoring program, we assign mentors to provide trainings to our new employees and help them understand their tasks and integrate into our corporate culture. We train up our employees to follow our standardised operational procedures to ensure our service quality and efficiency. We also have a human resource succession plan under which we identify and train up our employees to step into more challenging roles. During the Year, the Group has provided different types of training for its employees, such as the knowledge of property management, services requirement and market situation for the general employees and the knowledge of business communication, customer demands and risk management for the supervisory employees. In addition, we encourage and support employees to participate in external training by providing subsidies.

# OPERATING PRACTICES

Effective management of environmental, social and economic performance throughout the daily operation is considered as the core value of the Group. The Group displays commitment toward sustainable development by maintaining a close relationship with its suppliers and ensuring meticulous standards on its operation and business conduct.

# Supply Chain Management

The Group values the partnership with suppliers and aims to collectively promote sustainable development. The Group is devoted to enhancing operation throughout its supply chains by maximising operational efficiency and minimising ESG risks.

The Group has established the tender procurement management system for the effective management of the procurement process. For the selection of new contractors/suppliers, an evaluation and review mechanism is in place to ensure the compliance of suppliers and supplies quality. For example, we conduct reviews on new contractors/suppliers and verify their basic profile, credit certificates and other documents to ensure the compliance of the suppliers. In addition, the contracts signed between the Group and the contractors/suppliers clearly listed the expectations, policies and requirements of the Group. A safety management guideline is also included in the contract, which requires the contractors/suppliers to provide a safe working environment and sufficient training, information and supervision to their employees. Meanwhile, we regularly evaluate existing contractors/suppliers based on price, quality and other aspects. Unqualified contractors/suppliers will be opt-out to ensure the quality of products and services provided by the suppliers.

Environmental and social risks along the supply chain are also a key concern of the Group. The Group assigns specific personnel to check for the latest development in local supply chain-related policies and identify the potential environmental and social risks. When selecting suppliers, priority is given to those with more outstanding environmental and social performance regarding aspects such as energy conservation, occupational health and safety, supply chain management and anti-corruption. Suppliers having relevant certification or international recognition are usually more highly valued, but on the other hand, those involving in major corruption or safety incident are always downgraded.

Besides, the Group fosters sustainability by implementing green procurement and encouraging the use of eco-friendly products. We use and give priority to eco-friendly products, such as those with water or energy efficiency labels, use fewer packaging materials, have a longer shelf life or are made of recyclable materials. We also select suppliers that are able to deliver materials with short delivery time and delivery distance, where appropriate, to lower carbon emissions from transportation. We also remind our employees to use products purchased earlier to avoid wastage due to products expiring.

During the Year, the Group had a total of 73 major suppliers, divided by region as follows:

<table><tr><td>Number of Suppliers</td><td>2021</td></tr><tr><td>Northeast China</td><td>7</td></tr><tr><td>Central China</td><td>2</td></tr><tr><td>South China</td><td>7</td></tr><tr><td>Southwest China</td><td>49</td></tr><tr><td>Northwest China</td><td>8</td></tr></table>

# Service Quality and Customer Health and Safety

The Group believes that quality control is crucial to the long-term development of the business. The Group achieves responsible operation through the maintenance of quality services and the assurance of the health and safety of the customers. Different policies and measures for controlling and improving service quality and customer health and safety have been adopted in the Group’s property management businesses. Due to the business nature of the Group, it is not involved in any matters related to advertising, product labeling and product recall.

The Group has established the customer relationship management system and acquired ISO 9001:2015 Quality Management System Certification, which provides a quality control guidance to its daily operation. The Group has a professional quality control team which primarily focuses on maintaining service standards, standardising service procedures and supervising service quality throughout the operational processes. To ensure service and consumer satisfaction, we conduct internal reviews on consumer satisfaction at all properties under our management on an annual basis. The quality check and consumer satisfaction results factor in the performance review of project companies and regional companies.

To provide better customer experience and enhance customer service, the Group offers a service hotline for its customers. Through the hotline, our customers can inquire about our services, provide us with their complaints and feedback, and we can follow up and respond in time to provide timely and efficient solutions to the problems of our clients. In addition, residents and property owners can request repair and maintenance services, provide their feedbacks, suggestions and complaints through our Shi Xiang Yue (時相悅) mobile application and the online official account the Group registered with WeChat. The Group has established the customer reporting and complaint management practice guideline and the call center management system, which specified the standards and processes on receiving and handling complaints. The Group records all the complaints received and the complaints received are classified based on their nature, specialization and importance. The relevant department would be informed about the complaints and is responsible for assigning and handling the complaint. During the Year, 15 complaints were received, which were all handled according to the abovementioned procedure.