prologue in the times full of uncertainties and volatilities, a successful enterprise is not only about improvements on short-term financials, but more about its potential and dedication to sustainable development. in response to customers’ needs and creating values to our employees, cifi will continue to uphold its environmental responsibility and contribute to the society with its accomplishments going forward.
—lin zhong, chairman of cifi holdings’ board of directors
in recent years, as domestic and overseas markets are becoming more and more complicated, the sound development of corporate governance has been placed in the spotlight. esg investing, i.e. environmental, social and governance investing, is favored by a growing number of long term investors. during the 2020 plenary sessions of npc and cppcc, there were deputies proposing strenuous promotion of the esg investing practice in china for the country’s greater say and influence in the sustainable investing area. as a key benchmark of corporate sustainability, esg is drawing increasing attention from the society.
cifi holdings (group) co. ltd. (00884.hk) has been dedicated to playing a leading role in the practice of corporate social responsibility and seeking breakthrough in its esg indicators. in 2019, cifi established esg management committee and esg work group to advance the group’s sustainable development through committed efforts in environmental protection, social responsibility and governance capacities. on july 8th, 2020, cifi published a standalone esg report for the first time and early adopted comprehensive disclosure requirements from hkex’s esg reporting guideline, marking the group’s leapfrog improvement in the level and richness of disclosure.
as ceo lin feng stated, cifi upholds the bottom line of “compliance and integrity” and the mission of “building for a better life”, and constantly pursue quality development and improvement in corporate governance capacity. the newly published esg report demonstrates the group’s praiseworthy efforts in implementing corporate responsibilities in five key aspects, namely green buildings, construction with quality, compliance and integrity, staff welfare and philanthropy, and commitment to long-term sustainable development.
green buildings have been the focus of cifi’s esg investing practice. the group brings full play to its expertise and enforces the green concept throughout its process from product design, construction to supply chain management. besides, the group actively engaged in the development and application of the green building system, and has stipulated the standard of greenness and health for residential and office projects, which offers guidance on delivery of green and healthy buildings.
according to the esg report, cifi demands that all its residential projects to be certified with 1-star or above rating of china green building label while middle- and high-end projects to be certified with 2- or 3-star rating, or international green building rating systems such as the leed and well building standard. in 2019, cifi obtained a total of 15 green building certifications. specifically, the metropolis mansion project in hangzhou was granted with breeam four-star rating, and there were two other projects certified with china health building label.
in addition to pursuit of energy-efficiency and environmentally friendly design solutions, cifi also focuses on “green construction” through a series of environmentally friendly measures, which includes sewage management, dust management, wastes management, noise reduction, sanitation management of construction sites, water and material conservation initiatives.
it’s worth noticing that cifi has been thoroughly committed to the strategy of fully furnished projects. by the end of 2019, the percentage of fully furnished standardized products reached 92.3%. such requirement effectively save materials in use, reduce wastes, and prevent additional waste resulted from demolition and renovation.
moreover, cifi has been practicing green sourcing and contributing to the industry’s sustainable development via the management of its green supply chain. together with see, cura and other entities, cifi co-initiated the “china’s real estate industry green supply chain action”. besides, the group won the green supply chain (“gsc”) company title at the elite habitat award organized by the elite habitat development foundation for its excellent performance in the gsc campaign.
apart from the green building standard, cifi has been consistently carrying out the management philosophy of “quality first”. the group is certified by the iso9001 quality management system and has set up an all-rounded quality management system to ensure high-quality delivery of its projects.
cifi enforces “lifetime accountability” system to assure construction quality and has defined five key responsible parties for “geological survey, design, supervision, construction and contracting” respectively and refined the management system of construction records. in 2019, cifi added the indicator of client satisfaction rate into the performance evaluation of the heads of regional offices. in this way, the staff put quality management as top priority and seek to assure premium product quality.
cifi made great efforts to establish a “transparent construction system” based on industrialized construction, and pioneered to put forward the concept of “visible building” in the real estate industry in 2019. in response to property owners’ demands and areas they are concerned, cifi creates twelve key experiences across five dimensions, namely transparent standards, transparent materials, transparent process, transparent testing, and transparent services, through which clients are able to learn about and supervise in person the whole construction process of their own property. and such transparency pushes for higher construction quality, enhances efficiency of project management and assures project quality.
the report indicates that by 2019, the floor area of cifi’s projects built under the transparent construction system in china accounted for 52.32%, and the percentage is expected to hit 100% in 2021. in addition, the “visible building” model has been applied to 10 projects in eight cities such as wuhan, shenyang and guangzhou as of the end of first half of 2020.
cifi has also been devoted to the research and application of the building information modelling (bim) technology to further enhance its quality assurance capacity. by the end of 2019, the technology has been used in 156 projects. in response to national call for more prefabricated buildings, cifi is increasing the ratio of such construction in its newly developed projects, reaching 52% in 2019. the approach effectively reduces energy and water consumption as well as noise pollution in the construction process and improves product safety and quality.
cifi’s all-rounded quality assurance efforts are highly acclaimed within the industry. its projects have won multiple prizes, such as the tien-yow jeme civil engineering prize, bali national landscape award and the international property awards etc. in particular, cifi earned 57 titles at the 15th kinpan awards, and retained the first place in the master tally.
cifi has adopted a key measure to consolidate its internal governance by controlling and supervising the delegated authorities at regulatory and organizational level.
by combining regulations and corporate culture, cifi has compiled a series of audit and supervision regulations, and established a sound anti-fraud system. meanwhile, work procedures and accountability are implemented to avert power vacuum and ensure the group’s lawful and compliant operation. it launched the wechat public account— “cifi anti-corruption” in 2019, the public account regularly pushes updates about the group’s integrity campaign and cases of warning and offers a channel for online reporting, so as to raise its employees’ awareness of anti-corruption. what’s more, the group organized 33 anti-corruption training sessions online and offline that engaged all different levels of employees.
cifi is also a founding member of the enterprise anti-fraud alliance, the earliest, most sound and comprehensive entity in china that specializes in cracking down corruption in corporate governance. cifi joined the alliance in 2015 and became its standing committee member in 2019. through continuous accumulation and sharing of anti-fraud experience, cifi join hands with other members of the alliance to propel the establishment of a more sophisticated corruption risk monitoring system. at the end of 2019, cifi was named an “advanced unit” in the national enterprise anti-fraud campaign for its outstanding performance in internal audit, supervision and anti-fraud efforts.
in 2019, cifi established an esg management committee comprised of members from the board of directors, senior management and staff from functional areas to further strengthen the organizational and standardized management of the group’s sustainable development.
cifi also earned recognition from the capital market for its highly acclaimed corporate governance capacity. specifically, the company won titles such as china’s top 50 boards of directors by the fortune china, and the best corporate governing body and best esg metrics in asia by the institutional investor.
cifi’s special attention to employees’ health and safety are embodied in all aspects of its governance. in addition to strict compliance with national mandatory regulations regarding production safety, the group has prepared and implemented many guidelines on safety management, strict standards about on-site inspection and management of compliant construction, safety and health, and environmental protection, as well as each party’s responsibilities and power in safe and compliant construction. at the same time, the group endeavors to be named the “national/provincial/municipal safety and compliance demonstration construction site”, and includes corresponding mechanism into its project incentive & penalty system.
the esg report reveals that no major construction safety or quality accident was reported among cifi’s projects in 2019. in addition, 34 projects were named government’s demonstration construction sites, and 29 projects won provincial or above level honors.
cifi advocates “happy, healthy, diverse and progressive” employee values within its organization by: organizing different kinds of sports associations and diversified teambuilding events; establishing smooth communication channels such as the cifi employees’ forum to make sure that employees’ requests and advice are heard; setting up the “cifi university” with sound training models targeting talents on various levels and stages; and making online training fully available, of which the total training hours has exceeded 180,000 hours.
it’s worth mentioning that cifi has been named the “best employer-china” by aon hewitt china for three consecutive years since 2017, the one and only company within the industry to win the title for three consecutive years.
abiding by the philosophy of “altruism through philanthropy”, cifi has been consistently committed to philanthropy in areas such as repaying hometown and subsidizing education for many years, making all-out contribution to pandemic and disaster relief, and striving for better life. to date, cifi has made aggregated donations worth over rmb 300 million.
among them, cifi has granted cifi scholarship, tuition aid and teaching aid for 25 consecutive years at jian’ou first high school and jian’ou second high school; the group has carried out the “the walnut charity walk” tuition aid program into the heartland of the daliang mountains for 4 consecutive years by purchasing local walnuts and donated the sales revenue to the local farmers and volunteer teaching program there; lin zhong, chairman of cifi holdings’ board of directors, led a team and carried out a field trip, designed and donated funding for construction of the gym and natatorium at the new campus of the jian’ou first high school; the group also funded the renovation of teaching buildings, office buildings, dormitories, squares and other facilities at communication university of china, and also donated funding for the construction of university’s history museum and media museum; xianglin book garden in east china normal university funded by the group was officially put into operation in 2019.
when the covid-19 broke out at the beginning of 2020, cifi granted rmb 20 million as the containment and relief fund to combat covid-19 and donated in four batches of 157 medical care units, 34,000 pieces of medical isolation gowns, 2.24 million pairs of medical gloves, 13,700 pieces of protective goggles, 2,720 pieces of face shields, 8,900 n95 respirators, 150 pieces of protective gowns and 6,000 pieces of daily supplies to the fangcang shelter hospital. the fund donated rmb 1 million to shanghai youth development fund to help the youth overcome difficulties in study during the time of pandemic outbreak. meanwhile, the group’s leasing apartments, commercial properties and education businesses has waived the rent and relevant costs and offered special discounts to medical workers, through which the company joins hands with all parties to weather through the tough time.
in 2019, cifi completed the top-down design of its esg management, and promoted implementations to specific functional areas; in 2020, on one hand, esg had been alleviated as one of the group’s annual objectives, strengthen organizational capabilities and improve management efficiency, on the other hand, cifi will attach more importance to human values and contribution to clients, employees, the environment and society. cifi firmly believes such contribution is not only part of its corporate responsibility, but also demonstrates its adaptability to changes and capability of realizing long-term sustainable quality development.
cifi will continue to fuse the esg element into corporate strategies, endeavor to add presence in key egs indexes, and strive to develop itself into a sustainable centenary group as a benchmark of an esg elites within the real estate industry.
