It is the mission of Towngas Smart Energy to provide clean and reliable energy. We vigorously develop business related to renewable energy based on our existing resources to promote the Group’s low-carbon transformation towards smart energy, so as to enhance the Group’s climate resilience in all respects.

In 2022, based on the TCFD recommendations, we worked together with our parent company, the Hong Kong and China Gas Company Limited (Towngas), to prepare the Climate-related and Nature-related Directive Guide, formulating applicable transition and physical risk scenarios by reference to publicly available climate scenarios proposed by international institutions. We conducted in-depth analysis on the major risks and opportunities facing our business under various scenarios and developed more prudent strategies for future business development.

In terms of transition risk scenarios, we kept abreast of the latest trends. We reviewed the scenarios and descriptions of the four scenarios identified in 2020, taking into consideration the Net Zero Emissions by 2050 Scenario, incorporating the changes in the international energy market and the latest national policy requirements and with making reference to the World Energy Outlook 2021 of the International Energy Agency (IEA).

Green development is the necessary pathway for a company to achieve sustainable development. This is the philosophy which Towngas Smart Energy upholds to fully implement the Country’s and local governments’ ecological and environmental policies. We have in place a sound internal environmental management system to comprehensively improve green management, integrating the green concept into the process of project construction, production and operation while constantly strengthens the management of emissions and resources. We implement also the concepts of a green production, circular economy and ecological protection through measures such as enhancing energy use, improving production skills and processes, energy-efficient transformation of facilities and waste recycling, thus aligning economic and environmental benefits.

Towngas Smart Energy strictly abides by relevant laws and regulations on environmental management and protection, and strives to minimise environmental pollution and resource waste while providing customers with quality gas and services, endeavouring to create an ideal living environment for the next generation.

In addition, the Group set the following environmental management goals based on its production and operation characteristics:

• Continuously improve environmental performance and boost the efficiency of resource and energy use;
• Encourage the application of new technologies, processes, materials and facilities for the purposes of safety, energy conservation and environmental protection;
• Improve the environmental awareness of employees and external stakeholders through education and training.

The Company is committed to the pursuit of best practices that create comprehensive value rooted in stakeholder and public interest. Through shouldering its corporate social responsibility ("CSR") across diverse aspects, it promotes sustainable socioeconomic development.

Promoting Staff Development

Towngas Smart Energy places heavy emphasis on human capital development, adopting multi-faceted strategies and measures to enhance staff capability. The Company has launched specialised training programmes catering to the respective needs of staff. In addition to the Shandong Hong Kong and China Gas Training Institute, Towngas Smart Energy has set up training bases at various areas across the country to nurture staff at different roles through various training and courses.

Customer First

Towngas Smart Energy has always sought to provide its customers with amiable, professional and highly efficient service. The Company prides itself on being customer-centric and people-oriented. Ensuring safe gas supply is a fundamental cornerstone of Towngas Smart Energy's services. On the basis of this solid foundation, the Company continually seeks to optimise its customer service for a pleasant user experience. It also places great importance on safeguarding customer information, with a strong focus on cybersecurity and personal data protection.

Giving Back to Society

As a result of its years of community service, Towngas Smart Energy has gradually realised the ethos of "benefitting society, contributing to the community", which it advocates. In collaboration with its project companies, the Company has supported various public welfare activities, thereby fulfilling its CSR. Through promoting charity and community relations initiatives under its corporate brand, the Company draws the public's attention to welfare projects and volunteering services.

Sustainable Supply Chain Management

Towngas Smart Energy has incorporated the concept of CSR into its supply chain management. On the premise that their product quality complies with required standards and is approved by onsite inspection teams, suppliers with outstanding CSR performance will be prioritised for selection and subjected to regular appraisals. At the same time, the Company encourages its project companies to proactively engage in responsible procurement and contribute towards a green supply chain. The majority of our suppliers possess valid ISO 9000, ISO 14000 and OHSAS 18000 certifications.

Towngas Smart Energy has always considered safety as its priority. Throughout the years, it has upheld the principle of "safety first" and established a comprehensive risk management structure and production safety responsibility system to enhance safety awareness at every level. The Group pledges to take responsibility for safety and health and remains committed to its endeavour to attain even higher standards.

Multi-faceted Safety Assurance

The Company sets a different safety theme every year to encourage its project companies to implement relevant improvements. At the same time, it has launched a series of measures, including safety and risk management audits, indoor safety checks, reconstruction of old pipe networks, standardisation of engineering and installation processes as well as innovative technological applications to maintain its position as industry leader across various safety indices.

The Company established the Safety & Risks Management Department to guide and supervise the safety and risk management of entities within respective regions. Every project company is required to set up an operational risk and safety management department and also mandated to have a safety production responsibility system in place. Staff at all levels are required to shoulder their corresponding safety responsibilities.

Staff Occupational Health & Safety

Towngas Smart Energy places great emphasis on occupational safety and health ("OSH"). In addition to striving to provide staff with a safe work environment, the Group also disseminates OSH information to staff across various channels, including its WeChat Official Account and online learning platforms for in-depth safety education and promotion.

At Towngas Smart Energy, we do not employ forced labour, including but not limited to slave labour. Nor do we engage in human trafficking. We do not tolerate physical punishment, threats of violence or other forms of physical, sexual, psychological or verbal abuse as a means of enforcing discipline in the workplace.

The Group has a dedicated Environmental, Social and Governance (ESG) Committee comprised of Board Members and senior management from critical business units. The Committee formulates ESG targets that covers the Group's different business units, and the ESG performance improvement are in correlation with the performance assessment and remuneration package of the responsible management.

The respective Committee shall oversee the management of the Company and its subsidiaries in sustainability matters, including but not limited to health and safety; environmental protection; operating practices; relationships with employees, customers and suppliers; biodiversity issues; and community engagement, as well as pursue innovative practices to promote the Group’s sustainable growth.

Stringent Risk Management

Faced with sizeable development and a diversifying business, the Company exercises prudence when formulating strategies and project execution plans by utilising a tried-and-true risk management system. The Company ensures the health of its operations through applying an independent, objective, scientific and stringent approach to its internal audit.

Towngas Smart Energy has set in place a multi-layer risk management structure to effectively identify, evaluate, mitigate, report and monitor major categories of risks for the Company and its subordinating project companies. The Company also manages its business operation processes in a way that enables the formulation of targeted solutions to problems, thereby lowering risks.

Adhering to Ethical Practices

At Towngas Smart Energy, we uphold strong business ethics. We recognize facilitation payments as bribes and will prohibit them with no tolerance. It is formulated within the Group’s anti-corruption training programme.

The Company has issued strict guidelines on its internal code of conduct and anti-fraud policy against bribery and corruption, conflicts of interests, insider trading, and acceptance of gifts and receptions. The Company has also established official channels for stakeholders to report suspected fraud or any other misconduct, and encourages its business partners to jointly uphold principles of business ethics by adhering to the Company's anti-fraud policy. For relevant guidelines and forms, please refer to the Anti-Fraud Policy, Whistleblowing Policy and Whistleblowing Report Template.

Towngas Smart Energy Company Limited ("Towngas Smart Energy") is a public utility subsidiary operated by The Hong Kong and China Gas Company Limited in Chinese China with diverse businesses that contribute towards the Company's growth. With sustainable development as its goal, the Company focuses on energy accessibility and green energy development. Through innovative applications, the Company has developed integrated energy services that create business opportunities while achieving positive financial performance.

Diverse Business and Healthy Finances

The Company primarily engages in the sales and distribution of piped gas, with businesses ranging from piped gas provision, pipe network construction, operation of city-gas pipe networks, operation of natural gas refilling stations for vehicles to the sale of gas-related equipment.

Sustainable Business Development

The Chinese government encourages the adaptation of clean energy in order to improve the environment. Combined with the public's demand for a quality lifestyle, the cleanliness and safety of natural gas has made it the pillar in the country's adjustment of its energy structure. In the context of the macroeconomy and the opportunities and challenges brought about by the nation's policies, Towngas Smart Energy's business sustained a steady growth.

The Company applies innovation in its development of integrated energy services to improve energy efficiency. It has launched distributed energy projects at industrial parks, commercial complexes, public constructions and civil engineering, and explored new energy sources such as microgrids, incremental distribution networks and energy storage.