Recently, Zhe Li Holdings (02209) (hereafter referred to as Zhe Li) released its 2023 environmental, social and governance (ESG) report, which covers the group's sustainable development policies and strategies, and reviews its performance and strategies related to ESG-related risks and objectives.
Zhe Li was established in 1997 and is an online retailer headquartered in Hong Kong, China. It is engaged in the purchasing and selling of third-party brands and unbranded Asian fashion, lifestyle, beauty and entertainment products, and sells such products to customers worldwide.
The ESG report shows that the Zhe Li Board of Directors oversees the group's overall sustainable development and ESG performance, reviews the progress of the group in achieving ESG-related targets and its annual disclosure. The Risk and Compliance Committee is responsible for overseeing ESG matters and has established an ESG Working Group under the COmmittee to review the group's sustainable development performance and supervise the reporting process. Meanwhile, Zhe Li has developed a shareholder communication policy and established various communication channels to facilitate effective interaction with different stakeholders.
As a practitioner in the e-commerce industry, the nature of Zhe Li's business does not involve any direct air emissions, wastewater discharge, noise emissions or the generation of large amounts of waste. In the reporting year, Zhe Li successfully achieved its short-term goal of establishing a mechanism to reduce paper usage in its Hong Kong offices and warehouses. The upgraded intelligent robotic warehouse reduced the need for printing documents throughout the entire distribution process and converted them to electronic data processing. In 2023, the total paper consumption of the group was 1.18 tons, a decrease of 79.19% compared to 2022.
Due to Zhe Li's significant reduction in paper usage throughout its entire business operation process, greenhouse gas emissions have been significantly reduced. In the reporting year, Zhe Li emitted a total of about 510.43 tons of carbon dioxide equivalent greenhouse gases, a decrease of about 98.6% from the year ended December 31, 2022.
In the reporting year, Zhe Li's water consumption was 268 cubic meters, a significant decrease of 85.63% compared to 2022, mainly due to the fact that the new warehouse of the group does not use a water cooling system.
In terms of social sustainability, Zhe Li recruits talents from all parties and provides equal opportunities for talents of different ages, genders, and aspirations. As of the end of the reporting period, the group had a total of 454 employees, with male employees accounting for 31.1% and female employees accounting for 68.9%, including female representatives on the Board of Directors accounting for 11%.
The group values the continuous development of its employees and provides a range of training and development opportunities, including on-the-job training in technical and operational aspects, as well as occupational health and safety training, to equip employees with the necessary skills and knowledge for their responsibilities. During the entire reporting year, a total of 802 team members participated in training programs, accumulating more than 1,900 training hours. The employee training rate was 97.4%, and the average training hours for senior management, middle management, and general employees were 5.07 hours, 6.94 hours, and 3.02 hours, respectively.
In terms of supply chain management, Zhe Li values maintaining reliable relationships with existing and new suppliers. At the same time, to ensure the stability of the supply chain system, the group evaluates the quality, cost, delivery, and service levels of suppliers in meeting its needs annually, and considers environmental and social performance as one of the evaluation criteria, emphasizing reducing plastic consumption, minimizing paper usage, using more recycled content in packaging materials, and promoting other environmentally friendly practices.
In addition, Zhe Li stated that it is developing an artificial intelligence-powered operating system that is expected to completely change the supply chain management of the online retailing industry.
(Link to ESG researcher Deng Shixia)