Annual Report 2024

China Merchants China Direct Investments Limited Annual Report 2024 95 ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT (CONTINUED) SOCIAL RESPONSIBILITY (CONTINUED) Sustainable Supply Chain (continued) Number of the Company’s active suppliers by geographical region: Geographical location Number of active suppliers in 2024 Number of active suppliers in 2023 Hong Kong 17 10 Mainland China 5 4 We have requested our service providers to maintain confidentiality of our business information. The business agreement will be terminated should there be any breaches in relation to the confidential information leakage and we retain the right to pursue legal action for any loss resulting from the breach. Therefore, to reduce the regulatory risks, the Company and the Investment Manager closely monitor news outlet for any ESG non-compliances of our service providers. Responsible Investment Responsible investment is upheld by the Board and the Investment Manager, as it is believed that responsible investment practice is the key to deliver long-term sustainable value to our investors and shareholders. As the topic of sustainability is gradually becoming increasingly considered by investors during their process of making strategic investment decisions, it is with a clear sign that responsible investment will be widely recognised. Hence, we do take steps through considering environmental and social criteria when making investment decisions, and not engaging in financing activities which may violate any environmental or labour laws purposefully for profits. A due diligence process is in place when we examine our investment targets. It is important that the targets are not only performing exceptionally and having good development prospects, but are also fulfilling their ESG responsibility. ESG factors are taken into consideration when we are assessing the risks posed by our investment targets. For example, we would understand their ESG policies and consider if they had any significant ESG non-compliances in the past. Although we have minimal control over the business and operation decisions of the investee companies, we still pay close observation to their ability to fulfil ESG responsibility. Whenever appropriate, we will attend their general meetings to obtain a better understanding of their ESG policy and performance. When they fall short, we may raise questions in the meeting regarding their ESG performance. Apart from the above mentioned, we request investee companies to disclose significant non-compliance ESG issues in a timely basis and monitor news outlet for any ESG non-conformity.