2010

Transcription

2010

NOTES
This is the first sustainability report released by China National Chemical Corporation
(“ChemChina”). It has been compiled on the basis of the specific practices of
ChemChina and is a true reflection of the vigorous efforts made by ChemChina to
discharge its economic, environmental and social responsibilities and realize the allround sustainable development of the enterprise. To facilitate presentation and ease of
reading, China National Chemical Corporation is also referred to herein as “ChemChina”,
“Group Corporation”, “Group”, “Corporation” and “we” or “us” as appropriate under the
context.
Scope of Report
1
The time period covered by the report is from January 1 to December 31, 2010, with
appropriate tracing back to the significant years in the development history of the
Group. The report covers the headquarters of China National Chemical Corporation and
its subordinate units.
Normative References
2
In the compilation hereof, reference has been made to the Guidelines on CSR Fulfillment
by Central Enterprises issued by SASAC (State-owned Assets Supervision and
Administration Commission of the State Council), the Sustainability Report Guide (2006
Version) of the Global Reporting Initiative (GRI), ISO26000: Social Responsibility (2010)
of the International Standardization Organization and other standards.
Data Explanations
3
All the data herein contained are sourced from the formal documents and statistical
reports of the Group Corporation and the summarized statistics of the social
responsibility practices of its subordinate enterprises. The monetary amounts herein
involved are based on RMB as measurement currency, unless otherwise indicated.
Form of Release
4
This report is available in Chinese and English versions, in paper and in electronic form.
In case of any discrepancy between the two versions, the Chinese version shall prevail.
If you have any question, opinion or suggestion, please contact us at:
Add: No.62 West Road North 4th Ring Road, Haidian District, Beijing 100080
Tel: 0086-10-82677359
Fax: 0086-10-82677088
The electronic version hereof can be downloaded by logging onto the website of China
National Chemical Corporation (http://www.chemchina.com).
2010
Sustainability Report
CONTENTS
INTRODUCTION
Message From The General Manager
02
About Us
05
Management of Sustainable Development
07
Social Acknowledgements
09
Road of Sustainable Development
11
Key Performance Indicators
12
FOCUS
Reorganization of State-Owned Enterprises
for Optimization and Integration
14
Overseas Merger and Acquisition Marking
Successful Steps Toward Internationalization
15
Bluestar Summer Camp --- A 21-Year Practice
17
Chemical Industry Museum, Testament To The
Development Of The Industry
19
PRACTICE
Scientific Development
21
Scientific & Technological Innovation
31
Work Safety
35
Environmental Protection
39
Employee Care
45
Social Contributions
49
Prospects for the Future
53
54
Appendixes
2010
INTRODUCTION
2010 Sustainability Report
1
Message from the General Manager
we advanced the
strategic orientation of
Since its establishment in 2004, China National Chemical Corporation (“ChemChina”),
adhering to its strategic position of “Traditional Chemicals, Advanced Materials”,
and with its corporate philosophy of “To increase value for shareholders,To create
job opportunities for the society”, has deepened its business reform, accelerated its
restructuring process, implemented its international strategy, and integrated domestic
and overseas resources. It has exerted great efforts in expanding its markets, improved
technical innovations, accelerated its IT construction, and carried out management
reform to actively respond to the challenges arising from the global economic crisis,
periodic adjustment of the chemical industry and overproduction capacity, thereby
achieving steady, rapid and healthy development.
“New Science, New Future”
for the 12th Five-year Plan, which is
to take scientific development as
the main theme......
The total assets of ChemChina have exceeded RMB180 billion, 7.8 times the total at
the time of its establishment, and its main business revenue has reached RMB140.2
billion, 9.5 times the revenue at the time of its establishment. Our pace of development
has been faster than the average of our counterparts over the past 7 years. Today, the
Company ranks No.28 among the Top 500 Chinese Companies, No.1 among chemical
materials and chemicals producers in China and No.19 among Top 100 global chemical
companies, laying a solid foundation for building a chemical company with strong
international competitiveness.
While seeking development that will expand the scale of the enterprise, we have
deeply understood that, given the fully competitive market we are in, ChemChina must
change its mode of economic development as soon as possible to become stronger
and better. This is the only way that the Corporation can adapt to the complex and
fierce competition at home and abroad, and achieve the sustainable development of
the enterprise. In recent years, we have adopted the mode of intensive development
and adhere to the business development values of responsibility and restraint, focusing
our efforts on quality improvement. Last year in particular, we advanced the strategic
2
orientation of “New Science, New Future” for the 12th Five-year Plan, which is to take
scientific development as the main theme, the change of development mode as the
main line of work, focus on the adjustment and optimization of the four aspects of
capital structure, business structure, organizational structure and HR structure and
carefully build the core capabilities in the following four fields: optimized business
portfolio, world-class manufacturing, investment and project management, as well
as marketing and application development, in order to make ChemChina a first-rate
international chemical company achieving continuous creation of economic and social
value, economization of resources, environment-friendly processes and intrinsic safety.
We are fully aware that the way of internationalization is an inevitable choice for the
future development of ChemChina, as well as the start of an arduous long march. We
are very proud that over the past 30 years of reform and opening, we have completed
our industrialization process, which in Western industrialized countries lasted for over
a hundred years; however, does this mean that our approach to business management
has also exceeded their experience of over a hundred years? Are we in-step with the
trend of the world in the sense of social responsibility? Our survival strategy is to make
the business international and achieve sustainable competitive advantage during the
process towards internationalization, and link up our business management with the
best international practices and act according to international rules.
We live and grow in a global environment, and our business conducts its operational
activities globally. Under such conditions, our first responsibility is to observe those
principles of business conduct that meet world standards. These are the common
values of all of us working in international businesses, and also our basis for reference
and the goal of our efforts. In summary, the principles mainly include the following:
Principle of trust. The first priority is to create value for the shareholders. The
management and all employees of the Company shall act as trustees of the Company
and the investors, achieving benefits for the company faithfully and diligently and
safeguarding the healthy development of the Company to win higher returns for the
investors. They shall be honest and frank, use their powers and corporate resources
only for business purposes, and shall not become involved in any activity in conflict with
the Company’s interests or in trading of the Company’s securities, nor obtain any third
party gains by utilizing its confidential information.
Principle of title. The management and all employees of the Company shall respect
the property and rights of the Company, shall not possess or waste property of the
company, and shall protect the capital and equipment of the Company. They shall
protect the Company’s confidential information, technology and intellectual property
rights, and have respect for the intellectual property rights of our competitors.
Principle of accountability. Commitments should be made and observed, undertakings should
be carefully implemented, contracts undertaken on a voluntary basis and other obligations
should be assumed willingly, whether or not they constitute legally binding agreements.
Principle of transparency. Business should be conducted honestly and openly. One should
always remain honest and loyal to facts. Standards for independent audit and financial
reporting should be observed, and accurate and timely information should be provided to
investors and customers. Any information related to safety and health should be fully notified
and signalized. Cheating will not be tolerated, and accurate records must be kept. Important
information should be disclosed while fulfilling obligations of confidentiality and privacy.
Managers, in particular, are obliged to secure the transparency of their performance of their
duties and activities.
Principle of dignity. Respect all people, and safeguard the health, safety, emotions,
privacy and human rights of others. Confidential information of employees and
customers should be respected. The local culture where the Company operates should
be respected, and the culture of the customers should be respected. Vendors and
partners who respect dignity and human rights in their employment policies and who
3
observe health and safety standards
should be selected on a priority basis.
Employees should be assisted in
learning skills and gaining knowledge,
employment oppor tunities created,
and capabilities facilitating personal
development fostered.
Principle of fairness. Compete fairly and
freely, and treat the stakeholders equally.
The principles of fair trade, fair treatment,
fair competition and fair procedures
should be adhered to in dealing with
investors, customers, employees, vendors
and partners.
Principle of citizen responsibility. Be a
responsible social citizen. Firstly, laws and
regulations must be followed, as well as
relevant legal systems. The legal rights
and interests of the shareholders must not
be harmed. There must be no tolerance
of or involvement in any bribery or other
acts of corruption. Competition laws
should be observed, and timely payment
of taxes should be made. Domestic and
international laws and standards on
environment should be complied with, the
natural environment should be protected
and improved as much as possible,
sustainable development should be
promoted, and public property protected.
Working with public organizations,
employment, public health, environment,
safety and other social undertakings
should be actively par ticipated in,
and a leading role taken in innovating
technology, products, processes and
methods to contribute to local as well as
global economic and social development.
Principle of responsiveness. All parties
who may have reasonable demand for
and concerns about the activities of the
Company should be communicated
with, and the demands of investors,
customers, employees and the public
actively responded to, including respecting
shareholders’ resolutions, recommendations
and demands, supplying products or
services the quality of which meet or
exceed the demands of the customers,
remedying complaints from customers or
co-operators in a timely manner, responding
to the recommendations and claims of the
employees, and setting up communication
and consultation mechanisms.
The above eight principles were proposed by professors of Harvard Business School
based on their study of the legal environment and corporate rules of the world’s leading
businesses, whose business conduct is of world standard. I have borrowed their
proposal and customized the contents according to Chinese conditions. We can see
that these principles summarize the generality of business operation and management,
and reflect some of the spirit and philosophies of the market economy, e.g. rule by
law, contract, diligence, good faith, respect for human value and dignity, inclusion and
consultation, etc., which are in a direct line of succession with the corporate spirit and
cultural concepts we endorse, and identical to the strategic goals and priorities of work
of the Company. I quoted these principles in order to advise my colleagues that the world
is coming into a consensus on what are proper and valid business rules and conduct.
The chemical industry of China is now faced with a series of major challenges, including
insufficient supply of raw materials for fuel, irrational product mix, low level of intensive
development and strong pressure for energy conservation and environmental protection.
As a backbone enterprise of China’s chemical industry, we will uphold the above
principles of corporate citizenship, actively drive the healthy development of the industry,
adhere to restructuring and management innovation as the main line of work, maintain
scientific management, scientific and technological innovation as the primary foundation,
energetically introduce global chemical best practices, professional managers and firstrate intermediary consulting agencies, and continuously enhance our management
practices and core competitiveness to create a world-class manufacturing enterprise.
We are the first in the whole industry to come up with the “Zero Discharge” management
concept, focus on promoting energy saving, emission reduction, clean production and
the recycling economy, work hard to open up the environmental protection market,
represented by water treatment, and have made positive contributions to building a
resources-saving and environment-friendly society.
We believe that “human sustainability” is an essential element for the sustainable
development of the enterprise. We are committed to providing our employees with a good
working environment and development prospects and have for 21 years persisted in holding
the BlueStar Summer Camp for the children of our employees to pass on the corporate
culture of ChemChina to the next generation and help the employees grow together with the
enterprise.
We persist in working hand in hand with the stakeholders to practice the responsibility of
a global citizen, take part in the programs for public good at home and abroad and boost
harmonious social development. We built the Chemical Industry Museum of China, the first of
its kind in the country, as a testament to the historical process whereby chemical engineering
has improved human life. We also created the China Chemical Science and Technology
Fund, a public fund, to support the self-owned innovations of the scientists and technology
staff of the industry and facilitate the industrial adaptation of scientific achievements.
To promote the sustainable development of the Group Corporation, we set up the
Social Responsibility Promotion Committee to put the practices of corporate social
responsibility under normalized management. We have furthermore established and
improved the safety, health and environment management system, which has been
promoted throughout the Group. We have established the total risk management system
to enhance total risk management. We adhere to informatization as the breakthrough
point for pushing forward management innovation, solidify and standardize advanced
management flow to lay a solid foundation for sustainable development of the Group.
Responsibility brings together strengths and cooperation invents the future. In the first
year of the “12th Five-Year Plan”, we will join hands with the stakeholders, continue
General Manager:
to persist in the scientific outlook on development, closely hold onto the main line of
restructuring, uphold the concept of sustainable development, work hard with one heart
and one mind, forge ahead and contribute to the all-round, sustained and coordinated
development of the economy, society and environment.
4
About us
I. Company Profile
China National Chemical Corporation (hereinafter referred to as ChemChina) is a large
State-owned enterprise under State-owned Assets Supervision and Administration
Commission of the State Council (hereinafter referred to as SASAC) founded with the
approval of the State Council in May 2004.
ChemChina has continuously grown bigger and stronger by keeping to the path
of differentiated market competition. Since its establishment in 2004, ChemChina
has realized unconventional leapfrog development by upholding the development
philosophy of “Traditional Chemicals, Advanced Materials”. To date, 6 business
segments have taken shape, including advanced chemical materials and special
chemicals, basic chemicals, oil processing and refinery products, agrochemicals,
rubber products and chemical equipment.
As a chemical enterprise group with advanced comprehensive strength and capability
for scientific research, development and innovation, ChemChina owns 6 specialized
companies, 4 enterprises under its direct control, 113 subsidiaries, 24 scientific
research and design institutes, 8 listed A-share companies, 4 overseas enterprises, a
complete global marketing network and production bases and R&D centers in a number
of countries, including France, Britain and the United States.
China National Chemical Informati
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ChemChina Finance Corporation
ChemChina Asset Company
China National Chemical Conditio
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5
II. Corporate Governance
ChemChina is a State-owned enterprise registered pursuant to the Law of the People’s
Republic of China on Industrial Enterprises Owned by the Whole People. SASAC
performs the investor’s duty on behalf of the State through the Board of Supervisors
for Large Key State-owned Enterprises dispatched by the State Council to the Group
Corporation, which supervises the value preservation and appreciation of the Stateowned assets of the Corporation pursuant to the Interim Regulations on the Board of
Supervisors of State-owned Enterprises.
The Group implements the general manager responsibility system. The General Manager
Executive Meeting is the decision-making body of the Corporation for business management,
and studies and decides important issues of business management. The Group has 9
specialized committees, including the Budget Committee and Investment Decision Review
Committee, which provide support and proposals for the decision-making body.
The Group regularly holds the Employees’ Congress, where the leaders of the Group report
results of business management, the decisions on major issues and the implementation
thereof. Any issue that involves the immediate interests of the employees in respect of
reform, distribution and benefits must be discussed and adopted at the congress.
III. Corporate Strategy
Strategic orientation: Traditional Chemicals, Advanced Materials
New Science, New Future
Development goal: Attain the strategic goal of “2215” by the year 2015, meaning over
RMB200 billion of assets, over RMB200 billion of operating revenues, over RMB10 billion
of total profits, and a ranking in the Fortune 500.
Development concept: With scientific development as its theme and restructuring as its
main line of work, to accelerate change in the development mode of the Group; focus on
the adjustment and optimization of the four aspects of capital structure, business structure,
organizational structure and HR structure; and carefully build the core capabilities in the
following four fields: optimized business portfolio, world-class manufacturing, investment
and project management, as well as marketing and application development.
Corporate vision: Become a first-rate international chemical company achieving
continuous creation of economic and social value, economization of resources,
environment-friendly processes and intrinsic safety.
IV. Values
Core Values
Outlook on quality
Product quality is as important
as people’s morality
Outlook on culture
Vast Oceans embrace
numerous streams to its tide
Details determine
success
Outlook on unity
Harmonious family brings
everything into flourish
Outlook on integrity
To Increase Values for
Shareholders, To Create Job
Opportunities for the Society
Outlook on success
and failure
Behavioral Philosophy
Human Effort is the
Decisive Factor
Outlook on talents
Everything is good
for something
Never try to obtain illegal gains
Outlook on interpersonal
relations
The friendship between
gentlemen is as pure as crystal
Corporate spirit
Outlook on safety
To Work Hard and Never
Give Up, To Pursue
Harmonization but Accept
Differentiation
Cherish life, enjoy living.
We don’t want profits
with blood
6
Management of Sustainable Development
I. Idea of Sustainable Development
Harmonious win-win leads to sustainable development: In the course of
development, ChemChina has always taken into account both environmental and social
factors, committed itself to economic, environmental and social harmony, persisted in
joining hands with the stakeholders in pursuit of mutual benefits and win-win outcomes,
carried out scientific management and responsible business operations to achieve the
long-term value creation and sustainable development of the enterprise.
The Group has set up supporting systems that include the corporate governance
system, risk management system, responsibility promotion system and stakeholder
participation mechanism, which has effectively managed, coordinated and supported
its sustainable development.
Sustainable Development Model of ChemChina
II. Responsibility Promotion System
ChemChina has set up the Social Responsibility Promotion Committee led by the
General Manager as the primary responsible person, which is in charge of the all-round
leadership and unified coordination of the Group Corporation in its CSR promotion
efforts. The committee has an office composed of the relevant staff members from the
Production & Operation Office and the Planning Department of the Group Corporation.
The office is specifically responsible for establishing the rules for CSR promotion,
organizing CSR training, compiling and releasing the annual CSR report of the Group
Corporation (Sustainability Report) and other routine tasks.
7
Harmonious
win-win leads
to sustainable
development
III. Stakeholder Participation
1. Communication with Stakeholders
Stakeholders
Expectations on the Corporation
Form of Communications
Government
Ensure the supply of market resources,
a c h i e v e t h e v a l u e p re s e r v a t i o n a n d
appreciation of State-owned assets,
pay taxes according to laws, create job
opportunities, make indigenous innovations,
protect the ecological environment
Take part in the meetings and training held by the
government; invite government officials to the Group
for visits and investigations, promptly submit statistical
statements on economic dynamics and environment
Investors and
Creditors (Specific
to their listed
companies)
Improve corporate governance,
continuously increase the value of the
company, lower risks, carry out prudent
operations, pay principal and interest on
time
Accurately and promptly disclose information, release
annual report and hold the general meeting of investors
Employees
Safeguard the rights and interests of
employees, provide good benefits, training
and development opportunities, create a safe
and harmonious working atmosphere
Establish the mechanism of internal communications;
the trade union should regularly hold the Employees’
Congress; the General Manager should call employee
symposiums personally
Customers
Provide products of best cost effectiveness,
continuously enhance service quality,
unfold cooperation of equality and mutual
benefit
Make regular visits to promptly find out about customer
needs; invite distributors to the Corporation for
investigations and communications
Suppliers
Observe business ethics, laws and
regulations; set up long-term and equal
relations of cooperation for mutual benefit
and win-win outcomes
Make honest procurement and strengthen daily
communications
Community
Protect the environment and boost the
progress of the community, support social
programs for the public good, create job
opportunities for the community
Sign agreements for joint efforts, participate in the
construction of community projects, conduct regular
communications and launch get-together activities
Social
Organizations
Respect and implement the rules of the
organization, strengthen infor mation
disclosure and support environmental and
public welfare programs
Take part in the relevant meetings held by the social
organizations, offer suggestions and cooperate in the
work
2. Participation in Social Organizations
Playing a leading role in the industry, ChemChina is the unit that supports 9 associations of the industry, including the Membrane
Industry Association of China, the China Association of Fluorine and Silicon Material Industry, and the China Society for Petrochemical
Information, and organizes inter-industry exchanges of technology and information as well as policy discussions. It also sits on 10 other
industry associations and takes an active part in communications and cooperation to promote the healthy development of the entire
industry.
8
Social Acknowledgements
Social
Acknowledgements
Honors Won
2004: Advanced Organization of
Central Enterprises
Ministry of Personnel, SASAC
2006: Most Influential Enterprise
China Enterprise Confederation, China
Enterprise Directors Association
2007:“Outstanding CSR Enterprise
of China”
China Enterprise Reform & Development
Society, Organizing Committee of China
CSR Summit Forum
2008: “Charity Award of China”
Ministry of Civil Affairs
2008: Chinese Enterprises'
Indigenous Innovation TOP100
China Enterprise Evaluation Association
(CEEA)
2009: Innovative Experimental
Enterprise of State
2010: “Outstanding Contribution
Award” for Six Sigma of the Industry
9
Granted by
Ministry of Science & Technology, SASAC,
All-China Federation of Trade Unions
International Society of Six Sigma
Professionals (ISSSP)
10
Road of Sustainable Development
2004: Bluestar and CHC were merged to form China National Chemical
Corporation, push on the further integration of the chemical industry
and break new ground for the industry.
2005: “China Chemical Science and Technology Fund” was founded for the national
chemical industry to encourage indigenous innovations by the scientific and
technological personnel of the chemical industry.
2006: The Group successfully acquired Australian Qenos, French Adisseo and the
organic silicon and sulfide business of French Rhodia, taking the first step toward
internationalized operations.
2007: The Group Corporation realized RMB100 billion both in total
assets and in sales revenues, introduced the SHE (safety,
health and environment) management system of Qenos and
put forward the management idea of “Zero Discharge” to
focus on building a resources-saving and environment-friendly
enterprise.
2008: The Chemical Industry Museum of China was put into
formal operation. This is the first museum of its kind built
by an enterprise in China.
2009: The Group came up with the “3+1” strategy, which calls for the common
development of material science, life science and environmental
science on the basis of the traditional chemical industry to further
optimize the industrial structure.
2010: The Group achieved record-high operation results since its founding and
put forward the strategic orientation of “New Science, New Future” and
the strategic goal of building a world-class company.
11
Key Performance Indicators
Indicators
Unit
2010
2009
2008
Total Assets
RMB100 Million
1,796
1,676
1,569
Operating Revenues
RMB100 Million
1,402
1,135
1,219
Investment in Scientific and Technological
Research
RMB100 Million
26.06
30.59
30.87
Proportion of Investment in Scientific
Research to Operating Revenues
%
1.93
2.87
2.58
Number of Patents Granted
509
444
322
Number of Invention Patents Granted
313
275
210
3
8
12
0.02
0.08
0.09
65,000
40,300
41,700
1.52
1.61
2.05
Economic
Science & Technology
Safety
Total Safety Accidents
Accident Mortality Rate of Every 1,000
People
‰
Investment in Safe Production
RMB10,000
Environment
Comprehensive Energy Consumption for
Every RMB10,000 of Output Value
Ton Standard Coal/
RMB10,000
Total Discharge of Wastewater
10,000 Tons
11,295
11,549
12,494
Emission Load of COD
Ton
13,401
13,696
14,743
Emission Load of Sulfur Dioxide
Ton
42,159
43,174
51,148
Total Number of Employees
Person
140,692
145,711
156,411
Proportion of Females among the On-job
Employees
%
28.9
28.22
28.75
RMB10,000
899.3
488.3
2,168.2
Employees
Social
Donations to Public Welfare Programs
12
FOCUS
13
Reorganization of State-owned
Enterprises for Optimization and
Integration
......starting with Jiangxi Spark
Chemical Factory, involving some
50,000 employees. The
initiatives revitalized more than
RMB
17 billion worth of
State-owned......
The development history of ChemChina has been a process of continuous merger
and acquisition of State-owned enterprises for optimization and integration of
chemical resources. In the 1980s, Chinese chemical enterprises were small in scale
and unsophisticated in technology, thus it was a difficult process becoming adapted
for market competition. Many State-owned enterprises were enmeshed in operation
difficulties. Guided by the social responsibility of “promoting the industry and repaying the
country” and the needs of its own development, China Bluestar Group, the predecessor
of ChemChina, merged, acquired and reorganized a number of medium and large-sized
State-owned enterprises, starting with Jiangxi Xinghuo Chemical Factory, involving some
50,000 employees. The initiatives revitalized more than RMB17 billion worth of Stateowned assets and turned the Group into a major force within the chemical industry for
merger, acquisition and reorganization.
After the reorganization, ChemChina came to occupy an important position in the fields
of advanced chemical materials and basic chemicals, realized its own large-scale
development and promoted the optimization and integration of the resources of the
industry. Meanwhile, the reorganization has revitalized financially troubled enterprises,
provided jobs for their employees, driven the development of the local economy,
promoted social harmony and stability, and achieved a win-win outcome for the
enterprise, the industry and the society.
Jiangxi Xinghuo Chemical Factory --- From “headache” to “pillar”
During the 7th Five-Year Plan period, the State made huge investment in building the
largest 10,000-ton-class organic silicon plant --- Jiangxi Xinghuo Chemical Factory.
In the succeeding 13 years, however, 28 trial runs were conducted, with all ending
in failure. The project was once a “headache” of the former Ministry of Chemical
Industry. In 1996, China Bluestar Group took over the factory. The then General
Manager Ren Jianxin resided in the factory complex personally and invited some
100 Chinese and foreign experts to a consultation aimed at finding the root cause
for the abnormal operation of the plant. He worked in concert with the employees
of the factory. After 4 months of large-scale technological transformation, the plant
succeeded in the first trail run. From then on, China became the 6th country with the
ability to produce organic silicon on a large scale. By the end of 2010, the factory
had become a pillar enterprise in the organic silicon production of China, with its
production capacity ranking No.3 in the world.
Before the reorganization
After the reorganization
14
Overseas Merger and Acquisition Marking Successful
Steps toward Internationalization
For a long period of time, the lack of advanced technological resources and low level
of industrialization have been a bottleneck restraining the development of our chemical
industry. ChemChina has vigorously carried out overseas merger and acquisition (M&A)
15
by taking advantage of the industrial restructuring of the world and the “going global”
strategy of the central enterprises. In 2006~2010, it completed the acquisition of 4
foreign enterprises, including Qenos (Australia) Pty Ltd. and Adisseo France S.A.S. In
2008, the U.S. Blackstone Group as a strategic investor spent US$600 million acquiring
20% of the equity interest of China Bluestar Group, a wholly-owned subsidiary of
ChemChina.
ChemChina received the U.S. Blackstone
Group as Strategic Investment Partner
Through a series of successful overseas M&A initiatives and the introduction of strategic
investment, ChemChina is not only in possession of industrial resources with global
competitiveness, a world-famous brand and a global marketing network, but also has
obtained a series of technologies with independent IPR, which have helped solve
some longstanding problems for China, such as the deep processing of methionine
and organic silicon. After the M&A, ChemChina combines advanced international
technological and managerial resources with domestic production and market resources
to give maximum play to the synergy of domestic and foreign enterprises, thereby
promoting the overall internationalization process of the Group.
ChemChina’s Knack for
International M&A
“Able to acquire” means the successful acquisition of the overseas enterprises
in spite of the political and legal risks and obstacles encountered during “going
global”.
On November 26, 2009, Mr. Ren Jianxin,
General Manager of ChemChina, delivered
a speech entitled “ChemChina’s Knack for
International M&A” by invitation from School
of Economics and Management, Tsinghua
University
“Able to manage” means the effective management, optimization and integration of
the overseas enterprises through the formation of good management.
“Able to do well” means the redesign of a corporate governance system that meets
international practices.
“Able to synergize” means the fundamental principle for overseas M&A: All
overseas M&A moves must produce synergy.
“Able to exit” means that M&A shall include a design of exit channels such as
introduction of international strategic investors and overseas listing.
“Fly low” means the need to carry out low-profile M&A and modest management,
learn and respect the culture of the enterprises merged and acquired.
16
"Bluestar, Home to All of Us" Performance at the Summer Camp
Bluestar Summer Camp --- A 21-Year Practice
Bluestar Summer Camp is the only summer camp in China that is held by an enterprise
for the children of its employees --- still going after 21 years .
Bluestar Summer Camp is a helpful exploration made by China Bluestar to solve the
education and growth issues of the children of its employees. In 1990, the industrial
cleaning business of Bluestar spread all over the country so that many of its employees
had to live away from home or go on business trips all the year round. To relieve them
of concerns about the summer vacation life and education of their children, Bluestar
held the first summer camp. From then on, the summer camp became an annual event
for employees' children aged 7~15. Each year, the summer camp has a different theme
under the core idea of “Caring for the growth of the younger generation of Bluestar.”
17
With the business of China Bluestar spreading to the other
parts of the world, Bluestar Summer Camp has become a
breakthrough point for the fusion of Chinese and foreign
cultures. In 2009, the Bluestar Summer Camp welcomed
the first batch of children of overseas employees and gave
them an opportunity to understand different cultures during
the camp. The young participants, on their part, became
messengers of the corporate culture of Bluestar and further
promoted the exchanges of diversified cultures.
Foreign campers expressed their love for the
Bluestar with singing
Figure of Development History of
Bluestar Summer Camp
Ren Jianxin, General Manager of the Group
Corporation handed the Bluestar Summer
Camp flag to the Beijing No 1 Branch
The fist Summer Camp “ready to go”
Excellent Works of the 20th
Children’s Painting Contest of the
2009 Bluestar Summer Camp
The Earth, Our Homeland, Eva Coste
(Age 15, France)
Atmospheric Pollution, Li Xiyan
Left
Right
(Age 14, China)
18
Chemical Industry Museum, Testament to
the Development of the Industry
“The mission of the Chemical Industry
Museum is to pass on and innovate.
We should run the museum as an
undertaking. The history of China’s
chemical industry is time-honored and
condenses rich culture. We are dutybound to pass on the chemical history.”
--- General Manager Ren Jianxin of China National Chemical Corporation
To protect the heritage of the chemical industry and spread chemical-related
knowledge, ChemChina invested nearly RMB10 million in building the first chemical
industry museum of China launched by an enterprise and put it into formal operation
in 2008. The museum consists of 8 exhibition halls that accommodate more than 6,000
exhibits. In the two years since its start of operation, the museum has accepted over
10,000 visitors. It records the arduous development journey and great achievements of
China’s chemical industry, disseminates knowledge about the chemical industry, fosters
the interest of youngsters in taking chemistry courses and creates a good atmosphere
for building an innovative country.
19
The museum consists of
8
exhibition halls that accommodate
more than
6,000 exhibits.
On February 12, 2009, Comrade He
Guoqiang, member of the Standing
Committee of CPC Politburo and
Se c re t a r y o f t h e CP C Com m ission
for Discipline Inspection, visited the
Chemical Industry Museum of China
Ancient Ceramic
Left
Hall of Chemical Industry in
Modern Times
Right
Hall of Chemical Industry in
Contemporary China
Left
Chemical industry for national defense
On June 1, 2010, the students of the
Middle School Attached to Northern
Jiaotong University visited the museum
under the guidance of their teachers and
parents
Right
Left
On August 28, 2010, the students of Right
Tsinghua University enrolled in 2009 and
majoring in chemistry visited the museum
20
PRACTICE
Scientific Development
Scientific development is the premise and foundation for an enterprise to provide
continuous service for economic and social construction. Faced with a period of
strategic opportunity for global chemical industry development, ChemChina actively
optimizes its industrial structure, implements internationalized operations and constantly
pushes forward management changes, thereby forming a development pattern
characterized by rational industrial layout and optimized global resources, further
consolidating and raising its position in the industry and pushing its capability of
sustainable development to a new level.
In 2010, operating revenues
and total profits chalked up
a year-on-year rise of
I. Increasing Operating Results in Response to the Crisis
The impact of the global financial crisis on the chemical industry is still spreading.
Faced with the periodic adjustment and capacity surplus of the chemical industry,
ChemChina has made great efforts in tapping the market and strengthening its internal
control and synergy, realizing a steady increase in benefits. In 2010, operating revenues
and total profits chalked up a year-on-year rise of 29.8% and 64.9% respectively, seeing
operating results reach a record high since the establishment of the Group Corporation
and marking the effective fulfillment of value preservation and appreciation of Stateowned assets.
1. Growth Ensured via Market Expansion
Faced with the adverse factors brought by the financial crisis, such as declining demand
in the chemical market and the downslide of prices, ChemChina gave top priority to
market sales and payment collection, introduced global best marketing practices,
and consolidated and tapped the markets through a variety of measures, such as
establishing a modern marketing service system, strengthening the marketing teams
and stepping up the communications with distributors. Meanwhile, it has continuously
promoted the name brand strategy to enhance the market reputation of its products and
services and achieve the steady improvement of market performance.
21
and
29.8%
64.9% respectively,
......
Seeking Market Opportunities with Product Orientation
In response to the market fluctuations and uncertainty imposed on the overall
operation of the chemical industry by the international financial crisis, Nanjing Bluestar
New Chemical Materials Co., Ltd. took active countermeasures, undertook careful
planning and focused on the 4 aspects of optimizing the marketing strategy, ensuring
the long-cycle operation of the plant, lowering cost and increasing benefits, making
detailed market analysis to seek market opportunities and increase market shares
through internal and external combination and from multiple angles and levels.
A full view of BDO Plant of Nanjing Bluestar New Chemical Materials Co., Ltd.
2. Enhancement via Intensified Control
ChemChina gives full play to the advantages of an intensive strategy and strengthens
the dynamic monitoring and control of economic operations. It has established a 3-level
decision-making mechanism involving the “Group-to-Enterprise” teleconferences held at the
beginning and in the middle of each year, the operation working conference and the market
information monitoring and analysis to promptly communicate information, analyze, study
and coordinate the production and operation activities of the enterprise, achieve more timely
and effective control of economic operations and further enhance business management.
In view of the impact of the financial crisis, we held a Group-to-Enterprise teleconference
involving more than 110 enterprises at the beginning of 2009 to discuss with them the
major problems being faced and the possible countermeasures, bring into play the effect
of mutual collaboration within the sector, rely on the specialized companies as a platform
for concentrated procurement and sales of key products, lower cost, increase benefits
and solve the specific problems at the forefront of production and sales. This has played
a significant role in helping the enterprise tide over the difficulties for stable development.
3. Potential Increased via Internal Collaboration
A strong measure against the crisis is to strengthen internal collaboration and sharing of
resources. ChemChina gives full play to its advantages in industrial complementation,
improves the management of internal collaboration and has effectively alleviated the
impact of the financial crisis and increased the potential for sustainable development
through mutual collaboration and support in equipment procurement, business
development and other aspects.
22
II. Building up the Strength of Primary Business through
Structural Optimization
An industrial structure that features a prominent primary business and strong market
competitiveness is the core driver for the sustainable development of an enterprise. To
continuously strengthen the competitive power of the primary business, ChemChina
upholds the scientific outlook on development as guide, reinforces strategic planning
and research, accelerates the restructuring of the industrial products and creates
inexhaustible power for sustainable development.
1. “3+1” Strategy Boosting Industrial Restructuring
In the early days of its establishment, ChemChina carried out the reorganization of
business divisions and formed 6 business segments that include advanced chemical
materials and basic chemicals according to the principle of highlighting primary
businesses and specialized collaboration. Under the guidance of the scientific outlook
on development, it has come up with a “3+1” industrial development strategy to
gradually transform the existing business divisions into the industrial pattern that relies
on material science as core, on life science and environmental science as future and on
basic chemicals as strategic support to rationalize the business portfolio even more and
further consolidate the foundation of sustainable development.
2. Enhancing Core Competitive Advantages via the Construction of
Large Projects
ChemChina targets industrial restructuring and enhancement of competitiveness in
vigorously carrying out the construction of projects. In the 11th Five-Year Plan period,
it completed 95 key construction projects and a number of technical transformation
projects, which involved a total investment of RMB52.4 billion. Through the construction
of the projects, ChemChina has managed to optimize its industrial structure, even more
clearly highlighted its primary business, further enhanced the production capacity and
competitiveness of dominant products and improved its core competitive advantages.
In the 11th Five-Year Plan
period, it completed
95 key
construction projects and a number
of technical transformation projects,
which involved a total investment of
52.4 billion.
RMB
23
Polyethylene (PE) Project Supporting Catalytic Pyrolysis Process (CPP) unit in Shenyang
Chemical Industry Co., Ltd.
This is the world’s first industrialized plant that uses paraffin-based atmospheric
residues as raw materials in producing ethylene and propylene, which has opened up
a new technological route for the large-scale production of light olefins.
Catalytic Pyrolysis Process (CPP) of Shenyang Chemical Industry Co., Ltd.
3. Park Construction Boosting Optimization of Industrial Layout
Starting from its development strategy, ChemChina combines competitive enterprises of strong
industrial relevance and satisfactory investment returns with the local economy of sustainable
development through scientific planning, unified arrangements and the full scope given to
the driving effect of industrial clusters in vigorously carrying out the construction of bases and
parks, effectively expediting the optimization of the entire industrial layout of the Group.
Planning Map for the Parks and Bases of ChemChina
Panoramic View of the New Plant in Nantong
24
III. Allocation of Global Resources for International Operations
Seizing hold of the opportunities for industrial transfer, restructuring and enterprise
reorganization under the background of global economic integration, ChemChina
has made energetic efforts to open up overseas markets, implement overseas M&A,
increase the capability for global allocation of resources and further consolidate the
foundation of sustainable development.
1. Export of Domestic Products
ChemChina makes full use of State policies to open up international markets, promote
the export of products such as agricultural chemicals, tyres and PVC and has won a
good reputation for its “going global” initiative with high-quality products and services.
Aeolus Tyre Co., Ltd. Enthusiastically Opening Up Overseas Markets
The Aeolus booth at the World Truck Trade
Exhibition in Canada
Implementing the “going global” strategy, Aeolus has worked hard to increase the
added value of its products by gradually rolling out high-end brand products, opening
up markets through a variety of methods such as establishment of overseas franchise
shops and website, specialized exhibitions, multimedia advertising and sponsorship
of sports events, and strengthening the communications with its overseas distributors.
Finally, it has succeeded in building up the “Made in China” prestige on the fiercely
competitive high-end EU market, won public praise for the Aeolus brand on the
overseas markets and effectively improved its market performance. Aeolus is now the
No.1 brand of China on the overseas market for heavy-duty steel radial tyres.
Aeolus sponsoring German Women’s Soccer
Team
2. Import of International Resources
ChemChina has drawn up the internationalized operation strategy that includes
overseas M&A as the main content and succeeded in acquiring Adisseo France S.A.S
and Qenos (Australia) Pty Ltd. Leveraging cultural fusion as a breakthrough point, it has
realized the effective management of the enterprises acquired, given fullest play to the
synergy resulting from the collaboration with domestic enterprises and promoted the
common development of both domestic and overseas enterprises through integration of
business, transfer of technology and import of management.
140 kt/a Methionine Project (under construction)
in Nanjing
200 kt/a Organic Silicon Integrated Project
(under construction) of Xinghuo
ChemChina has built a methionine plant of
world-class scale in Nanjing by using the worldleading patented technology of Adisseo France
S.A.S for methionine production, ending the
history of China’s prolonged reliance on the
import of methionine.
ChemChina has built and upgraded existing
production installations in China by using
the organic silicon technology of Rhodia
i t a c q u i re d , t h u s h a v i n g i m p ro v e d t h e
competitiveness of domestic installations on
the global market.
25
IV. Development Foundation Tamped with Management Changes
As a main line of work, management changes are the consensus we have reached under
the multiple hits of the financial crisis, the periodic downslide of the industry and capacity
surplus. The essence of management changes is the initiatives revolving around sustainable
and profitable growth that are implemented in respect of the three crucial links that are
organization, people and methods to tamp the foundation for sustainable development.
1. Continuous Promotion of Organizational Changes
Organizational changes are the foundation of management change. In 2010, ChemChina
adjusted the departmental setup and roles of the specialized companies according
to the principle of specialization, standardization and centralization by drawing on the
international best practices and adhering to the objectives of streamlined management
hierarchy and improved organizational functions. Under a 3-level control mode, the
enterprises of the Group below the third level were integrated. The series of organizational
changes enhanced the control capability of the Group.
Advancing Management Reform and Implementing Specialized Control System
“Multifunctional Shift System” in nature is a reform of the management mode which
aims to enhance the on-site production control, maximize the optimized operation of
the entire system and achieve efficiency to the maximum extent. ChemChina Petroleum
Development Corporation, Daqing Branch specified the relevant duties, operating rules
and control procedures in its work plans of “Multifunctional shift system”, where (a) the
level of section in the management process is removed; (b) the shift head is directly
incorporated in the company management process; (c) the Technology Division of the
Company was set up; (d) review is conducted on a quarterly basis on the performance
of the technical management personnel of the fining installations. Since the adoption
of the system, the Company has seen steady improvement in the sense of specialized
control among its employees, and continued progress of its level of specialized control.
2. Intensified Changes in Human Resources
Adapting itself for the new situation of economic globalization and competition
internationalization, ChemChina has intensified its personnel strategy by establishing
six working mechanisms to continuously push forward changes in human resources and
provide management changes with strategic personnel support.
26
Under the guideline of “concentrating cutting-edge resources toward outstanding
entrepreneurs”, we promote the centralized management of legal persons and
hire professional managers as the legal representatives of the enterprise to realize
centralized and unified management, centralized sharing of resources, collaboration and
optimization of business and maximization of the interests of the enterprises. By the end
of 2010, 59 enterprises were reduced to 19 through the centralization of legal persons
and the sales of these enterprises involving centralized legal persons accounted for
more than 50% of the total sales of the Group.
3. Strengthened Financial Centralized Management
While promoting the centralization of funds, we have improved the management of
budget and final accounts, perfected the management of property rights and reinforced
basic financial work to tamp the foundation for sustainable development.
Update on Financial Centralized
Management in 2010
4. Continuous Improvement
The promotion of continuous improvement is the foundation whereupon ChemChina
continuously moves toward the goal of becoming a first-rate chemical enterprise of
the world. The Group carried out large-scale activities of continuous improvement to
continuously strengthen cost control and enhance the quality of economic operation.
By establishing a perfect working system, the Group covers the whole processes of
production, technology, quality and procurement with lean Six Sigma management;
carries out systematic training; develop Black Belt, Green Belt and Yellow Belt personnel;
implements lean Six Sigma projects and use the lean Six Sigma methodology, tools and
DMAIC skills to guide and encourage enterprise changes. In 2010, the Group achieved
marked results in continuous improvement.
27
Achievements on Continuous Improvement made by ChemChina in 2010
Organized 243 training sessions and implemented 472 lean Six Sigma projects,
which generated a total revenue of RMB380 million;
ChemChina now has a total number of 134 Black Belt, 560 Green Belt, and 8,000
Yellow Belt;
Implementing strategic outsourcing, which helped save a total cost of RMB372
million;
Detail benchmarking management by benchmarking 182 products and installations,
which achieved a compliance rate of 71.23%, saved a total cost of RMB496 million, an
increase of 8.5% over the same period of the previous year;
14 projects from Nantong New Material, Siping Haohua, Haohua Yuhang, Zhenghe
Petrochem, Aeolus Tyres, Dacheng Pesticide and others were selected as excellent
Six Sigma projects for 2010 by the China Association for Quality;
The Group Corporation was awarded as the Excellent Enterprise for Advancing
Six Sigma Management in China in 2010 and received the Outstanding Contribution
Award from ISSSP for Six Sigma.
5. Promotion of World-class Manufacturing
Creating a first-rate world-class manufacturing system is the basis for the survival and
development of ChemChina. The Group aligns itself with the first-rate enterprises of
the world and uses a large number of measuring systems and benchmarking data
based on the best practices of the manufacturing industry to guide the enterprises in
improving their management rules and flow and enhancing the level of their operation
management. By introducing chief manufacturing officers and first-rate international
intermediary agencies, the Group places all the fields involved by the enterprises
under the coverage of the ERP system to achieve the further improvement of personnel
building, organizational building and information systems, gradually establish a
corporate culture that is based on the rules for world-class manufacturing and lay
the foundation of sustainable development for the progress of the enterprises toward
internationalization.
Promotion of World-class
Manufacturing by Adisseo
An Adisseo plant in Commentry, France
Adisseo fully promotes world-class
manufacturing, effectively implements
the “zero accident” action plan and
utilizes profit management tools
and a pricing management system,
there by continuously enhancing its
competitiveness in terms of product
quality, delivery to customers, cost management and employee satisfaction. The
Group is spreading the successful experience derived from the experiment throughout
the sector.
28
6. Promotion of Comprehensive Risk Management
Simultaneous with the progress of management changes, ChemChina activated the
project of comprehensive risk management. By the end of 2010, it had essentially
erected the comprehensive risk management system, formulated the Measures of China
National Chemical Corporation for Risk Management, set up a risk database composed
of some 600 risk events and put forth a risk response strategy that includes the
“Researches on Promoting the Competitiveness of Business Divisions”. Meanwhile, the
comprehensive risk control experiment was conducted in China Bluestar (Group) Co.,
Ltd. and Shenyang Chemical Co., Ltd. and laid a good foundation for the full promotion
of risk management by the Group.
29
7. Acceleration of Informatization
Reflecting the efforts made to energetically push forward organizational changes
through informatization, ChemChina compiled and released the Guiding Opinions on the
Informatization of ChemChina to sort out its business through informatization and realize
the rebuilding of the enterprise on the basis of the advanced international management
ideas and methods as well as the best practices of global industry that have been
introduced. In 2010, seven informatization projects were completed, including the ERP
and the OA office platform.
China Bluestar Harbin Petrochemical Co., Ltd. speeds up its informatization
With APS, MES, ERP as core system, information portal as link, OA and contract
management software as expansion, independent software development as support,
informatization construction of Harbin Petro has formed its unique ecosystem, which plays
increasingly significant role in production and operation management. ERP system enables
technicians to accomplish the report and collection of equipment maintenance information;
production schedulers are able to easily create the production reports just by pressing
a button; general manager office can send and receive documents rapidly through OA
system; producing directors can monitor the flow fluctuation of various equipments through
network in real time, and then give their adjustment orders.
V. “4-in-1” Assurance for Lawful Operations
An effective supervisory mechanism is the foundation for ensuring the lawful operation of
an enterprise. Through the integration of departmental functions and optimized allocation
of resources, ChemChina has set up a “4-in-1” supervisory mechanism that fits in with the
modern enterprise system and has the characteristics of ChemChina to safeguard the
good, rapid, sustained and healthy development of the Group Corporation.
Operation Progress of the “4-in-1” Supervisory Mechanism of
ChemChina in 2010
The “4-in-1” Supervisory Mechanism
means the dynamic integration of the
four supervising functions of “Disciplinary
Inspection, Supervision, Auditing and
Legal Compliance” so that each function
can give a full play to its special roles and
achieve comprehensive results through
specialization and cooperation, and joint
implementation of various measures in a bid
to enhance supervision and auditing.
Audit &
Supervision
In 2010, 1,174 audit programs were implemented, involving a total amount
of RMB158.354 billion and recovering RMB25.892 million of losses.
Efficiency
Supervision
The entire sector registered 292 key supervision projects, involving
a total amount of RMB1.36 billion, avoiding RMB120 million worth of
direct economic losses and recovering RMB6.164 million of direct
economic losses.
Legal
Service
Anticorruption
In 2010, 31,062 contracts were examined, involving a total amount
of RMB53.319 billion.
Legal knowledge education was carried out to enhance the legal
awareness and knowledge of the enterprises and employees.
By the end of 2010, 27,567 people from the enterprises of the Group at
various levels received anti-corruption education and 553 statements of
anti-corruption responsibility were signed with the leaders at all levels.
30
Scientific & Technological Innovation
ChemChina regards scientific and technological innovations as the driver for its
sustainable development. It works hard to improve the mechanism of scientific and
technological innovations on the basis of scientific and technological orientation
and indigenous innovation to boost the conversion and application of scientific and
technological results, strengthen IPR creation and protection, expedite the scientific and
technological progress of the industry and turn scientific and technological innovations
into a powerful booster for the Group to face the “New Science, New Future”, change
toward a “3+1”industrial pattern and create a first-rate international enterprise.
Obtained
161 scientific
and technological awards at
the national, provincial and
ministerial levels and been granted
2,822 patents, leading the
central enterprises.
I. Performance of Scientific & Technological Innovations
Since its establishment, ChemChina has undertaken and completed some 1,600 major
scientific and technological projects under the National “863” Program and the Science
and Technology Supporting Program, developed a number of high-tech products and
technologies with independent IPR, obtained 161 scientific and technological awards at
the national, provincial and ministerial levels and been granted 2,822 patents, leading
the central enterprises. In 2009, ChemChina was approved to be a national experimental
innovation enterprise and included into the top three of the “100 Top Chinese Enterprises
of Indigenous Innovation”.
31
II. Optimizing the Scientific & Technological Innovation System
1. Improving the Science & Technology Management System
In its head office, ChemChina has a Department of Science and Technology, which is
responsible for the reform and development of the scientific and technological system
of the entire sector, building of the scientific research system, R&D of major scientific
and technological projects, guidance and management of IPR and standardization
endeavors. The specialized companies and the enterprises of research, development
and production all have organs responsible for the management of their scientific and
technological endeavors.
2. Building the Platform for Scientific & Technological Innovations
ChemChina has 24 national-level transformed scientific research and design institutes,
2 State key laboratories for comprehensive utilization of industrial gas omissions and
marine coatings respectively, 9 national-level engineering (technological) research
centers that focus on C-1 chemistry, reaction injection molding, organic silicon, force
structure engineering plastics and more than 40 engineering/technical research centers of
industries, provinces and cities. Additionally, ChemChina led the formation of 11 strategic
alliances for technological innovations in industries that include the pesticides industry.
Seven companies including Aeolus Tyres, Guilin Rubber, Yiyang Rubber, and Xinghuo
Organic Silicon Company have been certified as national-level enterprise technological
centers. Nine companies including Qingdao Huanghai, Tianhua Institute, Bluestar
Chenguan, Ocean Research Institute, Hebei Shenghua and others were approved by the
State to host post-doctoral R&D work stations, ranking high in central enterprises and the
chemical industry in terms of comprehensive strength of scientific research.
In the 11th Five-Year
Plan period, ChemChina
invested a total of RMB12.454
billion in science and technology,
averaging an annual increase
of 14.5% and accounting
for 2.14% of the sales revenues
on average.
3. Increasing Capital and HR Investment in Scientific & Technological
Innovations
Scientific and technological innovations are inseparable from stable support of
funds and personnel. In the 11th Five-Year Plan period, ChemChina invested a total
of RMB12.454 billion in science and technology, averaging an annual increase of
14.5% and accounting for 2.14% of the sales revenues on average. Meanwhile, it has
introduced and fostered outstanding scientific and technological personnel, and by
means of setting up post-doctoral R&D work stations, fostered a group of innovative
research talents in the chemical industry who possess strong capability, practicing
capability and foresight. In 2010, the Group had 5,649 R&D personnel and 17,796
engineers and technicians.
32
III. Promote the R&D and Application of Science &
Technology
After years of accumulation of technical innovations, the Group has made crucial
technical breakthroughs in six major business fields, including new chemical materials
and rubber products and formed a number of competitive technologies that reach the
advanced levels both at home and abroad. These technologies have been put into
fruitful industrialized application and expedited the common progress of the Group, the
industry and the society while supporting the development of the primary business.
The voltage transformation absorption separation technology developed by Sichuan
Tianyi Science & Technology Co., Ltd. has found widespread use in a number of
industries, such as chemical engineering, metallurgy and petrochemical engineering,
in more than 20 provinces, municipalities and autonomous regions. So far, over 1,300
plants have been sold at home and abroad. In particular, the large voltage transformation
absorption plant has replaced imported plants in petrochemical and other industries to
become the main force for gas separation in our petrochemical industry.
33
IV. Intensifying IPR Management
In 2010, the Group
825 patents,
including 503 invention
patents, and was granted 509
patents, including 313
applied for
invention patents.
Greatly valuing the role played by IPR in protecting the technical innovation of
enterprises, promoting the conversion of achievements and enhancing core
competitiveness, ChemChina has formulated its IPR strategy and established the
mechanism for IPR creation, application, management and protection. It set up the
“ChemChina Patent Award” to encourage the specialized companies to develop and
apply for patents. In 2010, the Group applied for 825 patents, including 503 invention
patents, and was granted 509 patents, including 313 invention patents.
V. Promoting Sci-Tech Progress of the Industry
ChemChina regards it as its own mission to boost the scientific and technological
progress of the chemical industry and has set up the “ChemChina Scientific &
Technological Fund” and the “ChemChina Scientific & Technological Award” that are
oriented toward the whole society and used to support and encourage the scientific and
technological innovation and application in the industry. They have played an effective
role in promoting and stimulating the scientific and technological progress of the industry.
China Chemical Science and Technology Fund
In June 2005, the Group established the China Chemical Science and Technology
Fund in a bid to support innovation projects in the chemical industry as well as related
industries. By the end of 2010, the Group extended its support to 36 projects with the fund,
including the “technology for the recycled use of the treated water from chloroprene rubber
production” of the Bluestar Engineering Company, the “project of treating waste water from
high concentration hyper saline acrylic acid production using biochemical method” of the
Shenyang Paraffin Wax Chemical Co., Ltd. These projects all focused on the research of
waste water treatment and recycled utilization, and made helpful explorations for reducing
pollution and emissions and cleaning development of the industry.
ChemChina Scientific & Technological Award
In October 2005, ChemChina launched the award with the approval of the Ministry
of Science and Technology. It is presented to the entities and persons who have
made significant contributions in chemical scientific research and technological
development, the application and promotion of the achievements of advanced
science and technology, and the completion of major scientific and technological
projects. In 2010, the Group presented the award to 39 winners for the 2009-2010
period after review, including 2 first awards, 14 second awards, 22 third awards and 1
special award.
34
Work Safety
During its development, ChemChina has always adhered to work safety as the
precondition, upheld the safety notion of “Cherish life, enjoy living. We don’t want
profits with blood”, explored the establishment of a perfect safety management system,
constantly strengthened safety management, focused on improving the occupational
safety and health of its employees and worked hard to create a first-rate international
chemical enterprise of intrinsic safety.
..... and lowered the accident
mortality rate per 1000 people
from
I. Performance of Work Safety
ChemChina has always put work safety at the top of the list, carried out operations
according to the work vision of “zero death” and “zero accident” and striven to build
a long-term mechanism of work safety. In the 11 th Five-Year Plan period, the Group
invested a total of RMB2.23 billion in work safety, experienced not a single major safety
accident and lowered the accident mortality rate per 1000 people from 0.09‰ in 2008 to
0.02‰ in 2010.
II. Improving the Safety Management System
1. Establishment of SHE Management System
For the purpose of system building, ChemChina established the SHE (safety, health,
environment) management system with its own characteristics in early 2010 on the basis
of the existing GB/T28001 Standard for Occupational Health and Safety Management
System and GB/T24001 Standard for Environment Management System and Guide to
Use by absorbing the successful practices and experience of the overseas enterprise
Qenos in combination with its informatization efforts, thereby laying a solid foundation for
improving safety management.
35
0.09‰ in 2008 to
0.02‰ in 2010.
Safety, Health and Environment Management System
2. Implementation of the Work Safety Responsibility System
ChemChina and its subordinate enterprises at all levels have set up the Safe Production
Committee, which is manned by full-time or part-time personnel. The Group has signed
the statement of responsibility for work safety objectives with the relevant principals,
which clarifies the persons responsible, responsibility objectives and accident control
indexes and incorporates the administrative responsibility for safety accident into review
and assessment.
3. Adherence to “Three Simultaneous” in Safe Production
ChemChina adheres to the “Three Simultaneous” examination system for the safety and
occupational health of projects in strict compliance with the relevant State regulations.
It has screened the in-progress chemical projects of the entire sector and requires that
all such projects must strictly implement the “Three Simultaneous” rule to move the
threshold of safety management up to the inception of project construction and enhance
the intrinsic safety of the projects.
III. Intensifying Work Safety Management
1. Standardization of Safety
ChemChina implements the Guiding Opinions on Further Strengthening the Safety
Standardization of the Enterprises of Hazardous Chemicals promulgated by the State
Administration of Work Safety, carried out safety standardization in an all-round manner
and improved its safety management procedures in 10 aspects, including management
rules, training and education, occupational hazards, etc. In 2010, 33 enterprises of
hazardous chemicals carried out safety standardization and 23 of them passed the
acceptance check of work safety standardization, showing a compliance rate that leads
all central enterprises.
2. Elimination of Hidden Safety Problems
General Manager Ren Jianxin conducts
focus research on work safety at the Bluestar
Chenguang Chemical Research Institute
ChemChina persists in treating the elimination of any hidden safety problem as an
important part of its daily safety management and has shaped a variety of inspection
forms, e.g. regular self-check, mutual inspection between the companies and selective
inspection by leaders. In 2010, the leaders of the Group Corporation led groups of people
in inspecting 42 key enterprises, where they discovered 3,076 hidden problems. The
enterprises organized 8,568 safety inspections and eliminated 12,570 accident potentials.
36
3. Reinforcement of Emergency Management
Emergency management is the most important line of defense in work safety.
ChemChina has set up files of major danger sources and the emergency management
system, compiled the site emergency rescue plan for the major danger sources,
provided emergency rescue equipment and conducted site emergency drills in a
planned way to enhance the accident-handling capability of the employees and sharpen
their safety awareness.
Emergency Management of the Group in 11th Five-Year Plan Period
Liquid chlorine leak emergency drill site of
Haohua Yuhang Chemical Co., Ltd.
4. Innovations in Safety Control Measures
ChemChina has innovated in the safety control measures and worked hard to improve
the scientificity and degree of all-member participation of safety management through
HAZOP analysis experiment, reporting of minor safety accidents and other measures to
effectively prevent risks and accidents in work safety.
IV. Focus on Occupational Safety & Health
The engineers of Tianjin Bluestar Refinery
are inspecting the safety of major production
devices
ChemChina pays close attention to the occupational safety and health of its employees,
earnestly implements relevant State laws and regulations, improves the occupational
safety and health management system, steps up labor protection, organizes regular
checkup and takes out health insurance for the employees so that great progress has
been made in the occupational safety and health of the employees.
Occupational safety warning sign on the
worksite of ChemChina Agrochemical
Corporation
37
Employee checkup organized by ChemChina
Rubber Corporation
2010
V. Building a Corporate Safety Culture
The building of a safety culture is a consistent effort of ChemChina. By continuously
carrying out education, training and publicity activities, it has infused safety awareness
into the daily work of the employees and formed a distinctive safety culture.
38
Environmental Protection
ChemChina attaches great importance to the major environmental issues of the world,
such as ecological protection and climatic changes, and vigorously carries out the
building of a resources-saving and environment-friendly enterprise under the guidance
of the “Zero Discharge” concept and on the basis of systematic, informatized and
benchmark-based environment management. It has given full play to its advantages in
scientific and technological R&D, opened up a new market for environmental protection
and formed new business growth platforms, thus promoting the coordination between
the development of the Group and environmental protection.
I. Management Concept of “Zero Discharge”
By putting forward the “Zero Discharge” management goal to the whole society, we aim to
change the impression that the “chemical industry is equal to pollution and vice versa” in
people’s mind through self-driving, self-stimulation and self-restraint so as to exhibit the new
concept and social values of ChemChina as a central enterprise for environmental protection.
——Ren Jianxin, General Manager of ChemChina
As a backbone enterprise of China’s chemical industry, ChemChina deems the
promotion of the green transformation of the industry as its unshirkable responsibility. In
January 2008, ChemChina took the lead in the industry to advance the “Zero Discharge”
management notion to commit itself to achieving maximized resources benefits and
minimized pollution emission with advanced management and technology. The Group
has established a strict project exit mechanism to gradually phase out devices of high
energy consumption and high emission from the production field. Meanwhile, it has
actively explored the technology for chemical “Zero Discharge” and built a number of
projects of “Zero Discharge” of wastewater, including Aeolus, playing an exemplary role
for the other enterprises in the industry in saving water resources and protecting water
environments.
39
Wastewater “Zero Discharge” Project of Aeolus
Tyre Co., Ltd.
II. Intensifying Environmental Management
1. Systemized Environmental Management
On the basis of the ISO14000 environmental management system, ChemChina has
initially formed the SHE (safety, health, environment) management system that has the
characteristics of ChemChina and meets the requirements of State laws and regulations
by studying and drawing on the merits of the SHE management system of advanced
enterprises, which is implemented throughout the Group, promoting the systemization of
environmental management.
2. Informatized Environmental Management
ChemChina is one of the central enterprises that are the first to achieve the online access
to modules of the SHE management information system. It has set up a network platform
that covers the head office, secondary specialized companies and tertiary subsidiaries
and integrates the collection, summarization, statistical analysis and daily management
of environmental information, realizing the fast and accurate submission and feedback
of information on environmental protection and greatly improving the efficiency of
environmental protection management.
3. Benchmark-based Environmental Management
Environmental benchmarking management is an important task that ChemChina
has always adhered to. Under the guiding idea of “aligning the benchmark with the
advanced international level” in regard to the consumption of energy and raw materials,
the Group has set up a long-term benchmarking management mechanism to “compare
with advanced practices, analyze gaps, make constant improvements to surpass these”.
The direction of improvement has been further clarified and the mode of environmental
management has been optimized through the benchmarking.
In 2010, Cangzhou Dahua Group Co., Ltd. promoted energy efficiency benchmarking,
fixed benchmarking values, took measures for energy saving and consumption
reduction, caused the decline in the consumption of energy and materials of primary
products and achieved satisfactory results in benchmarking management.
40
III. Building an Resource-saving and Environment-friendly Enterprise
1. Promoting Energy Saving and Emission Reduction
ChemChina set up a leading group for energy saving and emission reduction led by
the general manager of the Group Corporation and formed a management system of
energy saving and emission reduction that features unified leadership and collaboration
among functional departments based on distribution of responsibilities. The enterprises
at all levels sign annual statement of responsibility for the objectives of energy saving
and emission reduction to incorporate the indexes for the two tasks into the performance
examination of the leading bodies of the enterprises. While premier support is given to
projects of energy saving and emission reduction in newly launched projects, strong
efforts have been made to implement the technical transformation for energy saving
and emission reduction. In 2010, the comprehensive energy consumption of every
RMB10,000 of output value fell by 47.76% and the emission load of wastewater, COD
and SO2 dropped by 17.9%, 28.8% and 22.1% respectively from 2005, reaching the
objectives for energy saving and emission reduction set in the 11th Five-Year Plan period.
Shenyang Chemical is a participant in the “National Energy Saving Campaign
Involving 1000 Enterprises” designated by five ministries/commissions, including
the National Development & Reform Commission. For complete attainment of the
objectives for energy saving and emission reduction set in the 11th Five-Year Plan
period, it invested more funds and used technological innovation to push forward
energy saving and emission reduction. In 2006~2010, it invested RMB120 million in
completing 45 key transformation projects of energy saving and emission reduction,
creating RMB24.68 million of annual benefits on average.
2. Implementing Clean Production
ChemChina treats the examination of clean production as an important part of its
energy saving and emission reduction efforts and has drawn up the “Three-Year Plan for
Examination of Clean Production” to enable all the subordinate enterprises producing
hazardous chemicals to pass the examination of clean production by 2012. By the end
of 2010, 74% of such enterprises passed the examination of clean production at the
provincial/city level.
3. Developing the Circular Economy
Adhering to the principle of reduce, reuse and recycle, ChemChina promotes the
comprehensive utilization of wastewater, waste gas, waster residues and byproducts
and has created a large number of model enterprises of the circular economy, including
Hunan Xiangwei Co., Ltd., Hebei Shenghua Chemical Co., Ltd. and Jiangxi Xinghuo
Organic Silicon Factory. At the same time, it took advantage of the relocation and nonlocal reconstruction of the enterprises to optimize industrial layout, introduce resources
regeneration projects and form the industrial park of the circular economy for mutual
benefit and intergrowth.
41
Hunan Xiangwei Co., Ltd. --- Circular Economy Leading to Win-win Outcome in
Environmental Protection and Economic Benefits
For a long time, the company has actively responded to the State call for energy
saving and emission reduction, made innovations in its development thinking,
expanded recycling economy and markedly reduced the consumption of resources
and the emission load of pollutants. The “three wastes” have become regenerated
resources that can be utilized, obtaining a win-win outcome in both environmental
protection and economic benefits.
4. Boosting Low-carbon Innovations
......
reduce the emission of nitrous oxide by
500
tons each year in five
years’ time, equal to
155,000
more than
tons of carbon dioxide.
ChemChina focuses on technological and managerial innovations as breakthrough point
in its vigorous pursuit of clean development projects. In 2007, Heilongjiang Heihua Group
Co., Ltd. signed a CDM project agreement with Mitsui & Co. to reduce the emission of
nitrous oxide by more than 500 tons each year in five years’ time, equal to 155,000 tons of
carbon dioxide. The Group also promotes the experiment of carbon footprint calibration to
lay a foundation for the carbon reduction efforts of the entire sector.
“Carbon Footprint” Initially Measured & Calculated by
Hebei Shenghua Chemical Co., Ltd.
This is the only pilot unit carbon footprint survey of the national chlor-alkali industry.
In 2008, thanks to the joint efforts made by the experts and technical personnel
of related fields, the carbon footprint of each ton of PVC resin has been initially
measured and calculated, and was found to be equivalent to 1,467.79kg of carbon
dioxide. The result provides a measurement and calculation benchmark for the lowcarbon development of the chlor-alkali industry.
42
5. Practicing the Green Offices Solution
ChemChina promotes green offices in its everyday work. In its head office, an energysaving group was set up for the economized use of water, electricity and gas in the
building. While effectively reducing the consumption of energy and materials in the
offices, it also pays attention to cultivating the awareness and habits of the employees
for economization and environmental protection.
Major Measures for Green Offices in the Head Office of the Group
IV. Opening up Environmental Protection Market
1. Developing New Technologies for Environmental Protection
ChemChina carries out the R&D of technologies for environmental protection at all levels
that cover the sources, processes and terminal control and has formed a number of
competitive technologies for environmental protection with satisfactory environmental
benefits and promising application prospects, including the technologies for industrial
cleaning, water treatment and seawater desalination. These technologies have found
extensive industrialized use, enabling the Group to occupy a place on the environmental
protection market and make enormous contributions to the environmental protection
undertaking of the whole society.
Liquid separation membrane and water treatment technology
These have been used successfully in the rainwater drainage works of the “Bird’s
Nest”, one of the buildings for the Olympic Games, the steel-making wastewater
recovery project of Taiyuan Iron & Steel Works and other renowned water resource
utilization projects of China, representing the helpful explorations made for
developing the circular economy of the whole society.
Anti-osmosis seawater desalination technology
The technology was used in more than 70% of China’s seawater desalination
devices, including the first 100-ton-class project and all the way to the 50000 ton/day
Caofeidian project, so far the largest membrane seawater desalination project in
China.
43
Roof-top view of ChemChina’s Head
Office building
Technology of comprehensive use of yellow phosphorus tail gas
The model installation for purifying and utilizing yellow phosphorus tail gas built in
Kaiyang, Guizhou, the first of its kind in the world. After its capacity extension, the
installation will utilize more than 65 million Nm3, and reduces approximately 356 tons
of phosphorus, sulfur, arsenic, and fluoride each year. The technology was included
in the 2009 China List of Advanced Model Technologies for Pollution Control.
2. Developing Products for Energy Saving and Environmental Protection
These products have the merits of lowering energy consumption and reducing
emission and represent an important direction for future restructuring and industrial
development. ChemChina has intensified the development of products for environmental
protection, formed a product family that includes ionic membrane electrolyzers, green
environmentally-friendly tyres and reverse osmosis membranes, optimized product mix
and promoted the formation of the “3+1” strategic pattern.
Membrane Polar Distance Ionic Membrane Electrolyzer Included into the New
Products of the Year by the Ministry of Science & Technology
Beijing Bluestar Chemical Machinery Co., Ltd. has developed the NBZ-2.7
membrane polar distance bipolar ionic membrane electrolyzer, which saves
3~5% energy compared with other similar products and can compete with
similar foreign products. Its promotion and application has great significance
for eliminating the backward production capacity of our chlor-alkali industry and
lowering energy consumption.
3. Providing Environmental Protection Consulting Services
ChemChina has integrated its managerial and technological advantages to provide
environmental protection consulting service in the fields of the audit of energy saving
and emission reduction and the management of energy resources under contract. It has
made helpful explorations for enhancing the environmental protection of the chemical
industry.
ChemChina Information Center Serving Low-carbon Development
2010
ChemChina Information Center is the largest organization of China’s chemical
industry for the collection, study and service related to comprehensive information
resource. Enthusiastically answering the strategic requirements of the State for
energy saving, emission reduction and low-carbon economy, the center set up
ties of strategic cooperation with the China National Institute of Standardization
and BSI in 2008 to carry out the calculation and evaluation of carbon footprint in
chemical enterprises. Starting from 2009, it set about conducting energy audit
and pooled domestic and foreign experts for gradual expansion of the domestic
market. By now, the center has successfully completed the energy audit and
planning for two enterprises to become the pioneering enterprise of the Group for
environmental protection consulting services.
44
Employee Care
Employees are the most important asset and resource with which ChemChina achieves
sustainable development. The Group has firmly established the notions of “People Oriented
Approach” and “Everything is Good for Something”. It safeguards the rights and interests of
its employees and pays much attention to their sustained growth and career development.
It has brought up a group of employees that is talented, efficient, high in quality and rational
in structure. By the end of 2010, ChemChina had 140,692 employees.
I. Safeguarding the Rights and Interests of the Employees
ChemChina conscientiously implements labor laws, regulations and policies,
strengthens the management of labor contracts, improves the employment system,
opposes discrimination and forced labor of any form, and pays social insurance
premiums and public accumulation funds for employees in full and on time. The entities
with the necessary conditions also take out supplementary medical insurance for their
employees.
ChemChina safeguards the right of its employees to take part in democratic
management, continuously improves the supervisory mechanism for democratic
management in the basic form of the Employees’ Congress, holds various kinds of
symposiums for employees on a regular basis, widely solicit their opinions, and gives
full scope to the role played by the employees in democratic participation, management
and supervision during the reform and development of the enterprises.
In 2010 the Employees’ Congress of
ChemChina was convened in Beijing
II. Increasing the Introduction of Talents
ChemChina actively creates job opportunities for the society to alleviate employment
pressure. Upholding the notion that “employees are a strong support of an enterprise”,
it focuses on optimizing the structure of personnel through the introduction of talents
by increasing the employment proportion of master’s degree holders or higher-level
talents and has established a complete mechanism for the introduction and employment
of talents under an open, fair and just principle. In 2010, the Group employed 953
university graduates through campus recruitment.
45
Expatriate senior executives and heads of
overseas companies attending the 2010
working conference of the Group
Introducing the global best practices is an important initiative of ChemChina
for promoting sustainable development, while the energetic introduction of best
international talents is the key in this regard. Since 2008, the Group has introduced
professional innovative talents and senior professional managers by appointing them as
the CXO (Chief X Officer) of the Group or its subordinate enterprises and also working
as “tutors” or “coaches”to cultivate their successors. By the end of 2010, 21 overseas
professional managers had been introduced, with 7 being included into the State “1000elite Program”.
III. Promoting Employee Development
1. Strengthening the Training of Employees
ChemChina has set up a fairly complete personnel training mechanism and persists in
carrying out systematic, all-round and multi-level employee training through basic level
training plan, young and middle-aged cadres training program, orientation training of new
employees, remote online training of job foremen, participation in remote education through
advanced business management classes held jointly by SASAC and the Open University of
Hong Kong to enhance the vocational quality and knowledge of the employees.
“5 Half-Year” Grassroots Training
Program
To make sure that the employees of
the Group have rich experience in
grassroots work, ChemChina started
the “5 half-year” grassroots training
program for graduates in 2004,
meaning that the graduates who are
new entrants into the Group should
work for half a year in the head office
of the Group or any ssubsidiary and
for half a year in a grassroots unit
in each of their first 5 consecutive
years.
Route of “5 Half-Year”
Grassroots Training
All-round Training System of ChemChina
Recipients of
Training
Type of Training
Content of Training
Comprehensive
Quality Training
Enterprise profile, corporate culture, enterprise
specifications, industrial knowledge, language
skills, orientation training of new employees
Young
employees
Business Skill
Training
Onsite management of teams, knowledge about
corporate strategy, technical renovation and team
innovation, time management, remote online
training of job foremen of Central State-owned
Enterprises for management capability certification
Frontline
employees
and business
backbones
Management
Capability
Training
Leadership and implementation capacity,
change management, Six Sigma training
Middle and
high-level
managerial
personnel
“By modestly learning and seeking advice from
the experienced veteran workers, we can learn
a lot that we cannot learn from textbooks to
combine theories with reality.”
“Get adapted first before creation; blend in first
before harvest.”
--- Department of Science & Technology
Zhang Li
--- Planning & Development Department
Wu Zhenhua
46
Training Class of Young and Middle-aged Cadres
In March 2008, ChemChina teamed up with the Party School of the Central Committee
of C.P.C. to launch the training class of young and middle-aged cadres, providing its
managerial personnel with the opportunity for a half-year of off-job study, foster their
strategic thinking and increase their development potentials. By the end of 2010, the
class had been held 6 times and 450 people had received the training.
2. Valuing Career Development
“Training and bringing up a large number of talents fit for international competition is the
foundation and guarantee for reaching the goal of building a century-old chemical enterprise.”
——Ren Jianxin, General Manager of ChemChina
ChemChina works hard to provide its employees with a career platform and
development space by broadening the channels of occupational development and
making multi-level and all-round improvement of the mechanism for the development
and stimulation of talents, including benefits, career and spirit. The measures taken to
inspire the work enthusiasm of the employees and ensure the sustainable development
of talents include the program of human resources change and career planning,
successor program, leadership development program, backup talent fostering project
and selection of “ChemChina People”.
Group employees attending a Six Sigma belt
training session
3. Persisting in the Localization of Overseas Employment
In the operation of its overseas companies, ChemChina persists in using local
employees and safeguards their rights and interests. It also increases the
communications and exchanges with overseas employees in various ways, e.g. holding
employee symposiums and inviting trade union representatives to visit China, which
have strongly pushed forward local social employment and economic development.
IV. Focusing on Care for Employees
1. Proper Settlement of Employees
In the course of M&A, reorganization and management changes, ChemChina persists in
the notion of “never pushing a single employee out to the society”, combines the strict
observance of relevant State policies with the respect for the personal desire of the
employees and provides proper settlement for redundant employees in a variety of ways.
The people needed for new projects should be sourced from the existing employees of
the enterprises as far as possible so that reemployment is possible within the enterprises.
“Malan Noodles”—Embodiment of a Distinctive Way of Settling the Employees
In 1995, Bluestar Cleaning Company (predecessor of China Bluestar (Group) Co.,
Ltd.) created Malan Noodles to solve the settlement of redundant employees, which
the laid-off employees enjoy priority in operating. As a mode of employee settlement
peculiar to Bluestar, more than 400 chain outlets of Malan Noodles have been set up
across the country, creating more than 10,000 jobs. While boosting the development
of the enterprise, these outlets have also contributed to the building of a harmonious
society by providing job opportunities.
47
Scene of the assembly held in June 2009
marking the activation of the Successor
Program and Leadership Development Project
of Bluestar and CHC
2. Helping Needy Employees
ChemChina works hard to create a harmonious working atmosphere, values the
help given to its employees and increases the cohesion of the enterprise among the
employees in diversified ways, e.g. providing the needy employees with schooling
subsidies for their children, paying support money to needy employees and retired
workers, and setting up aid funds for those in exceptional poverty.
Xiao Xie, one of the aid recipients, is now a
student of Xiamen University
Fujian Sanming Doublewheel Chemical Machinery Co., Ltd. kicked off its “Student
Aid” program in 2001, which provides financial aid for the children of needy
employees studying at university. By the end of 2010, the program allocated
RMB160,000 to such students.
Taizhou No. 7816 Factory carries out a wide range of activities to enhance the
ideological and cultural quality and skills of the employees, relieve them of
psychological pressure, solve their conflicts and difficulties, and provide support
for the building of a harmonious and stable group of employees. In May 2010, the
factory was granted the title of “National Model Home of Employees” by the AllChina Federation of Trade Unions.
V. Building Corporate Culture
ChemChina holds that corporate culture is the core competitiveness of an enterprise.
In prolonged practices and development, it has extracted a number of distinctive and
easily transmittable ideas of corporate culture and built a culture system of credibility
and honesty peculiar to ChemChina, thereby providing ideological support and power
for the sustainable development of the Group.
The Group attaches much importance to the life quality of employees and enriches
their recreational and cultural life by building the employee reading room and holding
cultural and sports activities. It has also created a website using the three languages of
Chinese, English and French, opened a mail service for overseas employees and sends
the English newsletters of the enterprise to strengthen the exchanges and fusion with the
overseas enterprises and increase the understanding and recognition of the corporate
culture of the Group by the overseas employees and communities.
Above: On August 20, 2010, Aeolus Tyre held a
line dance contest for its employees
Below: The employees of Daqing China Bluestar
Petrochemical Company performing the program
Song & Dance, which they had compiled by
themselves, at the art festival entitled “I grow up
together with the enterprise” in celebration of the
50th anniversary of the factory
Library of Bluestar (Beijing) Chemical
Machinery Co., Ltd.
To widen the perspective of the employees and
broaden their minds, ChemChina has built the
“Employee Reading Room” and encourages
them to pursue lifetime study, read more books
and read good books, and adapt themselves
for the development of the times through
continuous innovations and studies.
48
Social Contributions
Based on its own cutting-edge developments, ChemChina makes great efforts to fulfill its
social responsibility as a corporate citizen, improves the service system, works closely
with the stakeholders, and blends into local communities to achieve the sustainable,
coordinated and joint development between the enterprise and the society.
I. Improving Customer Service
As an enterprise located at the middle part of the product chain, ChemChina upholds
the idea that “Product Quality is as Important as People’s Morality”, continuously
improves the quality management of its subordinate enterprises, strengthens customer
service and assists customers in standing out amid fierce market competition. Some
enterprises have gradually established a scientific and standardized customer
management system to promptly find out about customer needs, develop new products
from the perspective of satisfying customers, realize personalized customization,
increase the added value of products and achieve life-time customer satisfaction.
The purchasing change project of China
Bluestar Group won the award nomination of
Chartered Institute of Purchasing and Supply
(CIPS), the world’s largest purchasing
organization, for 2009 best purchasing
operation. This is the first time that a
Chinese enterprise has ever been
nominated.
II. Implementing Responsible Purchasing
Persisting in fair, open and just purchasing, ChemChina introduces strategic suppliers
and signs strategic agreements for products of high universality, carries out centralized
bid invitation and strategic purchasing, performs purchasing contract in good faith,
strengthens the monitoring of suppliers in respect of safety and environmental
protection, brings in third-party quality inspection and testing institutions and has
preliminarily realized effective control over the purchasing business of its subordinate
enterprises for mutual benefits and win-win common growth.
III. Strengthening Cooperation with Multiple Parties
ChemChina vigorously cooperates with the stakeholders, improves the mechanism for
enterprise-government communications and collaboration, intensifies bank-enterprise
cooperation, deepens the cooperation among the industry, universities and research
institutes and expands the cooperation in the industry for a mutually-beneficial and winwin result and promotes the common development of itself, the industry and the society.
49
On July 7, 2010, the People’s Government of
Gansu Province signed a framework agreement
for strategic cooperation with China National
Chemical Corporation
IV. Being a Global Citizen
1. Construction of Overseas Communities
The overseas enterprises under ChemChina have inherited the consistent goal of the
Group for carring out social responsibility. They value environmental protection, use their
best efforts to safeguard the legitimate rights and interests of employees, take an active
part in social welfare programs, work hard to realize safe and healthy development,
clean production development and environment-friendly development, effectively handle
the relationship between the internationalization and localization of the enterprises, solve
cross-cultural conflicts, and promote the harmonious development of the enterprises
and the overseas communities.
Qenos often sends its employees to public good activities, including the Run for
the Kids, a donation campaign in Melbourne, the City to Surf in Sydney, the “Ride
to Work Day” and other community activities. Through the “Scientists in Schools”
program, it provides young students with employment guidance or academic help,
thereby contributing to the local communities.
Employees of Qenos taking part in the “Run
for the Kids” donation campaign in Melbourne,
Australia
2. Exchanges of Diversified Cultures
ChemChina strongly pushes forward the communications and exchanges with overseas
enterprises and employees by inviting their trade union representatives to visit China,
holding the Bluestar Summer Camp and jointly carrying out cultural and sports activities
to expose overseas employees to the profound traditional Chinese culture and the
affinity of ChemChina, which increase mutual understanding and trust, boost the organic
fusion between Chinese and western cultures and help give play to the synergy of
overseas M&A.
V. Going All Out to Contribute to the Society
Chinese and foreign employees of Jiangxi
Spark Organic Silicon Factory carrying out
cultural and sports activities
1. Responding to Natural Disasters
As a responsible corporate citizen, ChemChina reacted instantly when natural disasters
struck and contributed to the society by organizing donations within the Group. In 2010,
the Group donated a total of RMB5 million to help fight against natural disasters such as
the drought in the southwest and the earthquake that hit Yushu, Qinghai Province.
Several enterprises affiliated ChemChina are located in Sichuan and Gansu. At the time
of the natural disasters, they organized self-rescue and tried hard to calm the residents
in the stricken areas. ChemChina also organized the enterprises affiliated it to produce
and transport materials and daily necessities that were urgently needed for the stricken
areas, including purified water, disinfectant, tyres, gloves and prefabricated houses,
strongly supporting the relief efforts of the governments at all levels.
50
Unyielding Spirit --- Earthquake Relief Work of Qingping Phosphorus Mine
Deyang Haohua Qingping Phosphorus Mine Co., Ltd. is less than 40km away
from the epicenter of Wenchuan earthquake, which caused casualties of nearly
300 people and RMB410 million of direct property losses to the mine. After the
occurrence of the earthquake, the mine immediately activated the response plan to
sudden disasters, made utmost efforts to find and rescue the buried employees and
the people in surrounding areas, quickly set up makeshift plastic sheds and shared
with the victims the anti-flood food reserves to tide over the difficulties. After learning
of the disaster, the Group immediately contacted the related authorities to airdrop
drinking water, food and drugs and conducted coordination for the rescue troops
to get into the mine, where they evacuated all the trapped employees and their
dependents and villages down the mountains, including 221 employees and their
dependents and more than 3,000 local villages.
In the post-disaster reconstruction, the Group carried forward the spirit of “unite and
work together to tide over difficulties” and provided the employees of the disasterstricken enterprise with temporary employment within the Group or opportunities
for remote training so as not to increase the burden of the local government in the
settlement of the employees. By August 2010, 212 employees of the mine had been
transferred to more than 60 enterprises under the Group.
Qingping Phosphorus Mine resumed normal
production on November 22, 2008
“Fulfillment of social responsibility not forgotten in rescue efforts; true quality of central stateowned enterprises revealed in the disaster.”
--- Party Building Work Bureau, SASAC “Earthquake Relief Deeds of Sichuan Qingping Phosphorus
Mine under China National Chemical Corporation”
“You deserve the title of central enterprise. In normal times, you show care for our production and life;
in the disaster, you treat us as family members.”
--- A victim near Qingping Phosphorus Mine after 5.12 earthquake
2. Enthusiasm for Social Welfare
ChemChina enthusiastically takes part in public good programs, persists in alleviating
the poverty of designated recipients and organizes its employees to take part in
voluntary services, e.g. blood donation, assistance in traffic control and nursing the
elderly without family in the communities, doing all it can to repay the society.
CHC Assisting Poverty-stricken Old Revolutionary Base Area in Economic
Development
In 2002, China Haohua Chemical (Group) Corporation set up the Poverty Relief
Office to focus on helping Pingshan County, Hebei Province, which is the object of
its poverty alleviation efforts and an old revolutionary base area. It invested RMB1
million in building a pig farm for Beigunlong Village and Taya Village. With a scale of
2,000 pigs/year, the pig farm can bring RMB100,000 ~ 200,000 of revenues to the
poor villages, causing great changes in their appearance.
Bluestar Group Tied up with Poverty Relief Area to Help Gulang County Develop
Capacity for Growth
Since 2003, China Bluestar Group has tied up with Gulang County in Gansu
province to help it relieve poverty. It focused on helping the area develop its own
capability for growth and relieve the local residents' poverty by providing financial
support, materials and intellectual resources. On October 21, 2010, Bluestar Co.
Ltd. donated 20 tractors to the county on behalf of the Bluestar Group for farming.
51
In August 2010, Guilin Rubber Machinery
Factory donated RMB30,000 of cash to its
object of poverty alleviation efforts, Mengdong
Vi l l a g e ( D o n g e t h n i c g ro u p ) , P i n g d e n g
Township, Longsheng County, Guilin, Guangxi
Province as funds for fixing up its cultural
facilities
2010
3. Wholehearted Contributions to the Communities
As a responsible central state-owned enterprise, ChemChina together with its subordinate
units has actively performed the responsibility of creating a harmonious society. While
focusing on its own development, it also pays great attention to its CSR, advocates
responsibility-guided care and satisfies the development needs of the local community.
Haohua Yuhang Chemical Co., Ltd. Ensuring Heat Supply to Residents Despite Its
Own Operation Difficulties
The company undertakes the supply of most of the heating for Jiaozuo, Henan
Province. In the second half of year 2008, the financial crisis inflicted a strong impact
on its business operations --- production equipment was running far below capacity
and funds were in serious short supply. In spite of the impasse of all-round loss and
forced restriction or even halt of production, it still ensured the heating gas supply to
the residents at the existing price by adjusting its operation mode, strengthening the
inspection of the heating pipelines and improving energy utilization efficiency from
the perspective of safeguarding social stability and performing social responsibility,
winning the praise of some 10,000 households in the heat-supplied areas.
4. Promoting the Development of the Industry
ChemChina and its subordinate units treat it as their own mission to promote the
development of China’s chemical industry. By taking part in the formulation and revision
of the standards of the State and the industry, holding exhibitions and forums, building
the Chemical Industry Museum of China and archives, they have set up a platform for
industrial information exchange and cooperation to increase the overall competitiveness
and development potentials of China’s chemical industry.
386
43
By the end of 2010, the Group participated in the formulation and revision of
standards, including
1
international standard,
standards of the industry and
260
82
national standards,
corporate standards.
ChemChina held the International Summit Meeting on Advanced Chemical
Materials three times, providing our new materials industry with a platform for
application and exchanges through cooperation among the industry, universities
and research institutes.
52
Prospects for the Future
2011 is the first year of the 12th Five-Year Plan and also the foundation-laying year when
ChemChina will work hard to create a first-rate international chemical enterprise. We will implement
the scientific outlook on development, and focus on good performance of the following:
With restructuring as the main line, we will continue boosting our capability to create economic
value. Further efforts will be made to expand the market, and further advance the continuous
improvement activities to achieve lean production and business excellence. Based on ERP
information system, we will implement “world class manufacturing” on a full scale. We will push
the industrial structure further toward “3+1” and take opportunities for strategic and emerging
industries while upgrading the competitiveness of traditional industries. We will deepen our work
on cost reduction and efficiency improvement, optimize capital structure, and lower debts level.
Efforts will continue to be made to optimize the business organizational structure and improve
centralized management of legal persons. IT construction will be accelerated and EVA system and
cultural cultivation will be promoted.
We will increase investment in scientific and technological innovations, and work hard to achieve
the goal of 3.5% investment in science and technology during the 12th Five-year Plan period. We
will work for zero major production accident and environmental pollution accidents; lower the
comprehensive energy consumption of every RMB10,000 of output value by 3% from last year
and achieve a reduction of more than 2% in the emission load of wastewater, COD and SO2.
We will deepen the strategy of strengthening the enterprise with talents, optimize the structure
of human resources, vigorously introduce professional managers, improve the system and
mechanism for personnel training and growth, perfect the personnel incentive policy and care
mechanism, create an environment favorable for the fostering, attraction, growth and use of talents
to enhance the soft power of the enterprise.
We will continue enhancing the business concept of legal compliance and good faith, advance
the construction of the Party's working style and a clean & honest administration. We will continue
strengthening the communications and cooperation with the stakeholders, promote a mutually
beneficial and win-win partnership with the government, banks and suppliers, persist in the notion
of serving the society, and take an active part in social welfare undertakings.
We will practice the responsibility of a global citizen, deeply promote domestic and overseas
cultural exchanges, take various approaches and methods to boost the local development and
construction in the areas where we operate. We will also learn the advanced experiences of
overseas enterprises in sustainable development and promote social harmony and development.
53
Appendixes
Glossary
“World class manufacturing” is a notion pioneered by American scholars Hayes and
Wheelwright in 1984. A world class manufacturing enterprise is an organization of highlevel customer service that can quickly and flexibly respond to customer needs to
provide customers with products and services of better quality and lower prices. It can
also continuously and quickly improve these capabilities.
“ERP (Enterprise Resource Planning)” was first advanced by Gartner Group Consulting
Inc. As one of the most advanced enterprise management modes in the world today, it
embodies the world’s most advanced enterprise management theories and, at the same
time, provides the best solution to the integration of enterprise information. It integrates
the management of material flow, human flow, cash flow and information flow of an
enterprise for purpose of maximizing the use of the existing resources and economic
benefits of the enterprise.
“Intrinsic safety” means the use of design and other methods to cause production
equipment or production systems to be safe in themselves and provide the function
of preventing accident even in cases of a misoperation or failure, including fail-safe
functions (where no accident will occur in case of misoperation or the misoperation can be
prevented automatically), fault-safe function (which supports temporary normal operation
or automatic change to safe status in case of any equipment and/or process fault).
“HAZOP (Hazard and Operability) analysis” means the prior identification, analysis
and evaluation of the latent hazards in any engineering project or production device
conducted with scientific procedures and methods from a systematic perspective to
discover defects in the design, operation and maintenance procedures of production
devices, offer improvement comments and suggestions, enhance the safety and
operability of the devices and technological processes, provide a basis for formulating
disaster prevention measures and emergency plans.
“CXO (Chief X Officer)” is a representation of the system that separates ownership
from the power of management under the modern corporate system, e.g. CEO (Chief
Executive Officer), CFO (Chief Financial Officer) and CIO (Chief Information Officer).
“Lean Six Sigma management” means the combination of lean production and the Six
Sigma management. Its essence is to eliminate waste and its purpose is to absorb the
merits of both production modes through a combination of the two to make up for the
deficiency of each and obtain better management effect. It is by no means a simple
overlapping of lean production and Six Sigma. Rather, it is the mutual complementation
and organic marriage of the two.
“DMAIC” refers to the process improvement method composed of the five phases of
Define, Measure, Analyze, Improve and Control, which is generally applicable to the
existing processes, including manufacturing, service and work processes.
“Responsible purchasing” means the full blending of the notion and requirements for
performing social responsibility into the whole process of purchasing to ensure that
the products and services so purchased are invested with “responsibility” and that
the purchasing transaction behavior of the enterprise is responsible. Responsible
purchasing includes two parts: the requirement for the enterprise to perform its social
responsibility for all the suppliers on the supply chain and the requirement for the
enterprise to perform its own social responsibility during purchasing transaction.
We refer to the former as supply chain responsibility and the latter as responsible
transaction.
54
Expert Evaluation
After carefully reading the 2010 Sustainability Report of China National Chemical Corporation (the “Report”), I offer the following
remarks:
China National Chemical Corporation (“ChemChina”) is a backbone enterprise of China’s chemical industry. Since its establishment in
2004, keeping the scientific outlook on development as its orientation, and adhering to its corporate philosophy of “To increase values
for shareholders, To create job opportunities for the society”, ChemChina has actively implemented mergers and acquisitions of Stateowned enterprises during its development and turned many financially troubled enterprises into profit makers and pillar businesses,
thus achieving optimized integration of resources in the chemical industry. The Group has also made remarkable efforts in overseas
acquisitions, employee care and the promotion of China’s chemical industry, and has won praise from all sectors of the society.
According to the requirements under the Guidelines on CSR Fulfillment by Central Enterprises issued by the State-owned Assets
Supervision and Administration Commission of the State Council, the Group incorporates the concept of sustainable development into
its strategy and operations, strengthens social responsibility management and furthers its sustainable development. In its proactive
response to the expectations and demands of the stakeholders, the Group released its first sustainability report, as a way to sort out
and summarize its social responsibility work over the past years, constituting an important milestone in its path to achieving sustainable
development. The Report's major features are as follows:
An emphasis on logic as the central focus. With the Group’s efforts to achieve coordination between sustainable business development
and sustainable economic and social development, the Report is built upon the six key areas of corporate social responsibility, namely
scientific development, scientific and technological innovation, work safety, environmental protection, employee care and social
contributions, and gives a full description of the Group’s philosophy, system, and measures for sustainable development as well as its
positive social and environmental performance.
Distinctive characteristics of the enterprise. The report focuses on some social activities that show the distinctive characteristics of
the enterprise, such as the Group’s promotion of management reform, implementation of world class manufacturing, proposal of the
concept of “Zero Discharge”, construction of the SHE management system, organization of the Bluestar Summer Camp, and the
opening of the Chemical Industry Museum.
Brief but descriptive contents. The Report is rich in content, and concise in description. It discloses a huge amount of data, charts and
cases for the benefit of the readers, who will find it very readable.
In summary, the Report displays rich content, clear logic, full and accurate data, and fully reflects the philosophy and practices of
ChemChina for sustainable development and fulfillment of social responsibilities. It meets the requirements of the UNGC for the
disclosure of information related to social responsibility, and is a sustainability report of high quality.
To further promote the social responsibility work of the Group, I offer the following suggestions:
1. To continue to make concerted efforts to promote the Group’s publicity and training work for social responsibility, and improve the
awareness and capability of all employees for social responsibility.
2. To further enhance construction of the social responsibility management system, and develop strategies and implementation plans
for social responsibility to advance the Group’s social responsibility work in an orderly and systematic manner.
3. To participate actively in important domestic and overseas events in the social responsibility area, increase the Group’s influence
with regard to social responsibility and enhance the soft power of the Group.
Previous United National Global Compact Board Director
Director of Beijing Rong Zhi Institute of Corporate Social Responsibility
Director of the Global Compact Network China Center
55
Form of Feedback on Report
Respected readers,
Thank you for reading this report. This is the first sustainability report we have released.
To improve our efforts relating to corporate social responsibility and enhance our
fulfillment thereof, we hope very much that you could spare some time from your busy
schedule to comment on this report and make suggestions to help us improve it.
1. What is your overall evaluation on the 2010 Sustainability Report of ChemChina?
□ Very Good
□ Good
□ Fair
□ Poor
2. Do you think this report is a complete reflection of the work we have undertaken
in promoting economic, environmental and social coordination and sustainable
development?
□ Complete
□ Quite complete
□ Fair
□ Poor
3. What do you think about our work in saving energy and environmental protection?
□ Very Good
□ Good
□ Fair
□ Poor
4. What do you think about our work in caring about employees?
□ Very Good
□ Good
□ Fair
□ Poor
5. What do you think about our work in making social contributions?
□ Very Good
□ Good
□ Fair
□ Poor
6. Do you think this report has disclosed sufficient data and information?
□ Sufficient
□ Quite sufficient
□ Fair
□ Poor
7. What do you think about the design of the contents and the layout of this report?
□ Very Good
□ Good
□ Fair
□ Poor
8. You are welcome to give your comments and suggestions about the 2011
Sustainability Report of ChemChina in the following space:
You can submit your feedback in any of
the following ways:
Tel: 0086-10-82677359
Fax: 0086-10-82677088
Add: No.62 West Road North 4 th Ring
Road, Haidian District, Beijing 100080
Department of Social Responsibility,
Production and Operation Office, China
National Chemical Corporation
56

2010

Transcription

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