Ping An has built a four-tier ESG governance structure:

• The Board of Directors bears full responsibility for the Group’s ESG strategy and information disclosure.
• Reporting to the Board, the Group ESG and Sustainability Office oversees and manages core ESG issues and initiatives, such as green finance, climate change, and carbon neutrality.
• The Group ESG Secretariat coordinates with all departments and subsidiaries to implement ESG initiatives.
• At executive level, each subsidiary and department has its own ESG personnel.

Ping An has identified two major risks for its business, demographic change and climate change, and has taken action in response to each.

1）Demographic change’s impact to customers

Due to lifestyle changes, people are facing more serious health problems, including obesity and diabetes. Customers need healthcare and senior care services that go beyond financial protection.

Ping An is striving to become the world’s leading integrated financial, health and senior care services provider.  As of the third quarter of 2024:

• Nearly 63% of 240 million retail customers used services from our health and senior care ecosystem

• Ping An had about 50,000 internal and external doctors, and partnered with more than 36,000 hospitals, more than 104,000 healthcare management institutions and more than 233,000 pharmacies

• The home-based senior care service covered 75 cities in China

2）Demographic change’s impact to agents

Traditional life insurance business relied on human interaction. As China’s population ages and the labor force shrinks, there is more competition for workers. New businesses such as Uber and Deliveroo are developing fast and attracting more and more young people as drivers or delivery riders.

• Life insurance reform. In response to these trends, Ping An Life is transforming its agent force to build a more sustainable team with "high productivity, high quality, and high income”. The company is focused on recruiting high-quality new agents through high quality existing ones. In the first nine months of 2024, Life & Health new business value (NBV) grew 34.1% year-on-year, and NBV per agent grew by 54.7%.

• Using AI to cover routine tasks. In order to enhance operation efficiency and productivity. Ping An Life is using artificial intelligence (AI) in insurance sales and the claim process. The company has developed a series of digital tools such as the Intelligent Visiting Assistant - AI Meeting Platform, which is used in a wide array of business scenarios, including agent recruitment, smart training, and digital sales management, to fully support the agent team to carry out recruitment, training and marketing management.

3）Climate change’s impact to business

Global warming has increased the frequency of extreme weather events, which can cause damage to assets and affect business operations. Also, natural disasters affect pricing, payouts and underwriting strategies. Investment needs to minimize exposure to industries and regions that are vulnerable to climate change.

• Ping An issued the Policy Statement on Coal Related Business and the Policy Statement on Responsible Investment, integrating ESG factors into underwriting and investment and financing processes, and proposing criteria for underwriting and investment and financing.

• Carbon neutral targets and roadmaps. The Group aims to be carbon neutral at the operational level by 2030 and at the portfolio level by 2060. in 2023, Ping An Group conducted an operational level carbon inventory of its divisions and 21 subsidiaries, and formulated short-, medium-, and long-term roadmaps to carbon neutrality.

• Technology advancement. Ping An Property and Casualty (P&C) Insurance developed a Disaster Risk System (DRS) for physical risk identification and management. The system has accumulated astronomical, geographic, and meteorological knowledge with historical big data. It can assess risks from 8 types of natural disasters, including landslides, floods, tsunamis, typhoons, tornadoes, lightning and snowstorms, and send 15 types of early warning messages to individuals and enterprises.

Yes. Ping An has integrated social responsibility indicators into the management's performance appraisal mechanism. Key performance indicators related to sustainability, such as rural revitalization and green finance, are linked to senior management compensation.

Ping An has a two-tier governance structure, including:

1）Board of Directors

2）Supervisory Committee

• Board of Directors

According to the requirements of the National Financial Reporting Authority (NFRA) and the Shanghai Stock Exchange（SSE）, the proportion of independent directors shall not be less than one-third of the total number. According to the Hong Kong Stock Exchange (HKEX), the Board of a listed company shall include at least three independent directors which should also represent at least one-third of the Board of Directors.

Ping An’s Board has 15 seats, including six Independent Non-Executive Directors. The proportion of Independent Directors is 40%, exceeding the requirements of the NFRA (1/3), SSE (1/3), and HKEX (1/3).

• Supervisory Committee

The key responsibility of the Supervisory Committee is to monitor the performance of directors, balance the power of the Board and safeguard the rights and interests of the shareholders.

Ping An’s Supervisory Committee has five seats, including three Independent Supervisors and two Employee Representative Supervisors. Ping An is the first Chinese company in the industry to introduce Independent Supervisors.

• Ping An’s Board Diversity Policy recognizes not only gender, but also language, cultural background, education, professional experience, industry experience, skills, knowledge and tenure of service. The selection of candidates is based on a range of diversity categories with reference to the Company's business model and specific needs.
• Ping An conducts regular assessments of board diversity and discloses the information in its annual reports. We are committed to continuous improvement in governance practices.
• Ping An’s directors have high professional qualifications and rich practical experience, domestically and abroad, in corporate management, law, investment, actuarial science, insurance, banking, finance and accounting, technology, engineering, risk management and economics.
• Ping An has three female board directors, representing 20% of all directors, which exceeds the requirements of Hong Kong Listing Rules and leads other companies listed on the Hong Kong Stock Exchange.

The Board approved the establishment of the Co-CEO structure in 2018. After six years of practice, the Co-CEO model has proven to be effective. We believe this is the best leadership structure for Ping An. Ping An has transformed from the “founder model” to “collective successor team” model.

Ping An has a wide range of businesses, from insurance, banking, and asset management to health and senior care and technology. Each of our Co-CEOs has a different area of expertise.

• Co-CEO Xie Yonglin is responsible for the Group's finance business segment, including Ping An Bank, the corporate integrated finance business, and the development of subsidiaries related to the finance segment. Mr. Xie joined Ping An in 1994 and has worked in multiple subsidiaries and departments.
• Co-CEO Michael Guo manages the company’s insurance business, healthcare business, and oversees the group’s technology strategies. Before joining Ping An in 2019, Mr. Guo’s roles included Managing Director and Partner at The Boston Consulting Group, and Global Co-CEO of Capital Markets at Willis Towers Watson.

Ping An has announced targets to achieve operational-level carbon neutrality by 2030 and asset-level carbon neutrality by 2060. We are progressing towards these goals.

We have a roadmap to achieve carbon neutrality in our operations:

• The first step is measuring electricity consumption in the workplace and data centers, as well as to develop plans for energy conservation.

• The second step is using more renewable energy. We plan to increase renewable energy utilization rates each year, from 5% in 2024 up to 100% by 2030. Ultimately, we intend to utilize 100% renewable energy in our operations.

• Carbon offsetting would only be used as a last resort.

For carbon neutrality at the asset level, we have issued Policy Statement on Coal Related Business (2024) to set strict limits and criteria, covering all insurance, investment and banking business.

Climate change poses physical risks and transition risks to any company. Ping An has taken measures to reduce the risks and turn them into opportunities. The opportunities include product innovation, digital transformation, market expansion, green investment, transition finance, and industry collaboration.

Ping An conducted an asset-level carbon emission inventory project in 2022 and 2023, and identified a number of challenges to disclosure:

• Insufficient valid data. Even using authoritative data sources from a third party, a considerable amount of estimation was still required. In addition, there is poor data matching between domestic and international data.

• Lack of accounting methods covering complex asset classes. Ping An’s insurance fund investment is more than RMB5 trillion, covering complex asset classes. PCAF (Partnership for Carbon Accounting Financials) is the most common standard for calculating carbon emission for the finance industry, but it only covers six asset classes: listed equity and corporate bonds, business loans and unlisted equity, project finance, commercial real estate, mortgages, and motor vehicle loans.

• We will keep a close eye on the development of more comprehensive emission data and emission factors issued by government, and will continue to work with investees and partners to explore more accurate carbon accounting methods.

• China has set a target to reach carbon neutrality by 2060. This target was set based on China’s actual status in economic development, employment patterns, and industry structure.

• As a responsible company, Ping An has taken China’s economic and social conditions into consideration, and set targets aligned with the national target. The withdrawal of all investment and financing of high-carbon industries must be managed carefully to avoid high unemployment rates and shortage of residential electricity. The potential of social instability and an increased burden on society run contrary to the concept of sustainable development.

• Since the national target for China is set for 2060, most of the companies we invest in and finance have also aligned their goals to this timeline. As such, it would be difficult for Ping An to achieve portfolio-level carbon neutrality by 2050.

1）In insurance business

We have released our Policy Statement on Coal Related Business (2024) to set strict limits and criteria for all insurance subsidiaries. Underwriting for all new coal and thermal power projects abroad have been stopped Domestically, Ping An’s insurance subsidiaries have been asked to investigate each project’s environmental impact, including location, waste treatment and environmental protection measures. We will exit from projects that do not meet national standards.

2）In investment business

• We issued our Policy Statement on Responsible Investment (2024) and our Policy Statement on Coal Related Business to set strict limits and criteria for all our investment subsidiaries. For direct investment, we aim to divest from all thermal coal mining and thermal power generation projects by 2035, except for projects that can achieve net-zero emissions. For indirect investment, by 2035, we will exit from the holding of shares or bonds in companies which derive more than 30% of their revenue from thermal coal mining or thermal power businesses.

• Ping An was the first asset owner in mainland China to sign up to the United Nations Principles for Responsible Investment (UNPRI) and Climate Action 100+. We are engaging with some fossil fuel companies and steel companies on their decarbonization strategies and information disclosure.

3）In banking business

• Ping An Bank has incorporated green finance requirements into its Credit Business Policy. For high-emission industries like coal, the bank will enforce strict management in line with the Risk Manual for the Green Finance Business and conduct annual industry climate risk stress tests as required by People's Bank of China (PBOC), to reasonably control climate risk exposures, especially in high-carbon and high-emission industries.

• China has set targets to reach peak carbon emissions by 2030 and carbon neutrality by 2060. Against this backdrop, high-carbon emitting industries are in urgent need of transformation, and there is a huge financing gap. The current financial system has strict restrictions on the financing of traditional high-carbon industries, such as coal power, iron and steel, and cement. Even if these industries have the willingness and plans to transform, they often face funding problems. Some banks and investment institutions have even listed all activities related to high-carbon emission enterprises as “prohibited financing”, and this one-size-fits-all approach is not conducive to the low-carbon transformation of society.

In 2024, the National Development and Reform Commission (NDRC) released the Guidance Catalog for Green and Low-Carbon Transformation Industries (2024 edition), which encourages financial institutions to support seven categories of industries: Carbon Reduction Industry, Environmental Protection Industry, Resource Recycling Industry, Energy Green and Low-Carbon Transformation, Ecological Protection and Restoration Utilization, Infrastructure Green Upgrading, and Green Services.

Ping An Bank provides the necessary financial support in accordance with the guidance catalog, targeting projects with significant carbon emission reduction benefits, helping them to realize low-carbon transformation and upgrade environmental protection technology.

Ping An issued the Policy Statement on Employee Rights (2024), which prohibits discrimination on the basis of any non-professional competency factors, including age, gender, and race.

Ping An works to create a diverse and friendly working environment for employees. For example, we have accessible toilets and wheelchair-accessible desks available for employees with mobility issues to ensure everyone’s comfort and convenience. Translation assistance is available for non-Chinese speakers who require work information or important documents in English. 

In terms of gender diversity, as of the end of 2023:

• Senior management: 5 of 12 senior managers are female (42%)

• Employees： More than 50% of our 288,751 employees are female (147,408)

1）High employee satisfaction

• Since 2022, Ping An has sponsored an annual third-party survey of all employees in terms of their job satisfaction, job fulfillment, and willingness to recommend Ping An as an employer. In 2024, the results of the survey showed that the overall employee satisfaction score was 90 out of 100, showing two consecutive years of increases.

• Ping An was recognized in Forbes’ World Best Employers 2024 list, ranking 2^nd among China’s financial companies. The list was compiled from anonymous surveys of approximately 300,000 employees at multinational companies in 50 countries/regions and featured 850 companies globally.

• Ping An was also recognized in the 2024 MSCI ESG ratings for its strong efforts to attract and retain talent, relative to industry peers. Ping An’s Human Capital Development indicator is 2.8 points higher than the global industry average.

2）Measures to support employees’ development, and safeguard their rights, interests and welfare

Protection of employees’ rights and interests – The company issued a Policy Statement on Employee Rights and a Business Code of Conduct. Both have stated that employees can express their opinions to the Company through various channels. The Company has set up a whistleblowing hotline and email to receive non-consumer customer service-related complaints from internal and external parties (including, but not limited to, company employees, customers, suppliers, government and regulatory units) about the Company, its employees and agents. Whistleblowers can report anonymously.

Employee training courses – The Group has developed 375 online and offline courses for employees. In 2023, the annual average training hours per employee reached 45 hours.

Employee loyalty program – Ping An offers an Employee Stock Ownership Plan and the Long-term Service Plan. As of the end of 2023, a total of 103,232 employees participated in these plans, a coverage rate of 36%.

Protection of employees’ safety and health –Ping An has taken a number of steps to build a heathy workplace environment for employees:

• All employees are entitled to medical and insurance coverage
• Ping An organizes regular medical examinations for employees and invites professional medical teams to interpret the results for employees：
• All employees are entitled to medical and insurance coverage
• Ping An organizes regular medical examinations for employees and invites professional medical teams to interpret the results for employees
• We encourage our employees to exercise. Every morning and afternoon, Ping An TV broadcasts a fitness video for employees to do light exercise
• Ping An renovated office buildings for high air quality. In 2021, Shenzhen Ping An Financial Center received Platinum certification for LEED (Leadership in Energy and Environmental Design) v4.1 O+M (Operation and Maintenance). The LEED certification recognizes excellence in energy conservation, environmental protection and sustainability.

• Focusing on quality over quantity – Traditional life insurance business relied on human interaction. As China’s population ages and the labor force shrinks, there is more competition for workers. New businesses such as Uber and Deliveroo are developing fast and attracting more and more young people as drivers or delivery riders. In response to these trends, Ping An Life is transforming its agent force to build a more sustainable team with "high productivity, high quality, and high income". Although the number of agents is declining, productivity is increasing. Ping An Life is recruiting high-quality agents through recommendations from current high-quality agents. From January to August 2024, 60.9% of new hires had a college degree or above (Talent+).  In the first nine months of 2024, Life & Health new business value (NBV) grew 34.1% year-on-year, and NBV per agent grew by 54.7%.

• Established an incentive mechanism – Ping An Life has developed a set of incentives according to the level of the agent. 

• Protecting agents’ rights and interests – Ping An issued the Agent Welfare and Management Policy to protect agents’ rights and benefits. Ping An Life provided agents with various welfare benefits, including a pension fund, long-term service award, and medical check-up services.

• Using AI to support agents – In order to enhance operation efficiency and productivity, Ping An is using AI in insurance sales and the claim process. Ping An Life has developed a series of digital tools such as the Intelligent Visiting Assistant – AI Meeting Platform, which is used in a wide array of business scenarios, including agent recruitment, smart training, and digital sales management, to fully support the agent team to carry out recruitment, training and marketing management.

Ping An hired a third party to conduct a customer satisfaction survey in 2023. The result showed a Net Promoter Score (NPS) of 59, representing three consecutive years of growth (The NPS range is -100 to +100. Scores above 50 are considered “excellent”).

1）Group level

• Management structure – Ping An established a Consumer Rights Protection Committee under the Board of Directors. The main duties of the committee include studying consumer rights protection topics, determining policies, and overseeing the rules governing the legal rights of consumers.

• Policy statement – Ping An issued its Policy Statement on Employee’s Code of Conduct, and Policy Statement on Responsible Product Management. The Group Internal Control Center, in cooperation with subsidiaries, conducts an annual internal audit on the implementation of the above-mentioned policies.

• Employee training – Ping An regularly organizes consumer protection seminars and online courses for its employees.

• Customer complaint hotline – Ping An Group has a 24-hours-a-day, seven-days-a-week service hotline, 95511, to receive consumer complaints regarding insurance, banking or investment business. The operators refer cases to specialized personnel for follow-up.

2）Subsidiary level

The subsidiaries have formulated their own policies and management mechanisms in accordance with the Group's requirements. For example, Ping An Life has taken measures on multiple fronts:

• Improved the team structure, focusing on recruiting new high-quality agents recommended by current high-quality agents – Strict measures are taken to enhance the quality of new recruits.

• Developed courses to guide agents in compliant sales – To address sales misguidance, Ping An Life introduced 15 courses in 2023.

• Providing various channels to receive customer feedback, such as official websites, company’s WeChat account, WeChat mini program, Weibo, and TikTok. The insurance agents’ working platform app, Pocket E, can also log customer complaints.

• Penalties for violators – Ping An Life formulated The Quality Management Measures for Individual Life Insurance Sales Personnel, to provide guidance to agents on doing business ethically. Agents who engage in sales misguidance are penalized.

Ping An pays close attention to social trends, including the aging population and other demographic changes. In order to better understand their impacts on the insurance business, we conducted research on both risks and opportunities related to the social trends. After evaluation of the risks and opportunities, Ping An launched products and services to fulfill rising demands of the market:

1）Integrated finance + health and senior care services

Ping An aims to become a world’s leading integrated financial, health and senior care services provider. As of the third quarter of 2024:

• 63% of 240 million retail customers used services from the health and senior care ecosystem

• Ping An employed 50,000 doctors, and partnered with more than 36,000 hospitals, more than 104,000 healthcare management institutions, and more than 233,000 pharmacies

• Ping An’s home-based senior care service covered 75 cities in China

2）Life insurance reform

• The traditional life insurance business model relied on human interaction and an agent sales force. As China’s population ages and the labor force shrinks, there is more competition for workers. With the demographic changing, Ping An focused on increasing agent productivity. The company is recruiting high-quality new agents recommended by current high-quality agents, and assigns basic work tasks to AI.

• In the first nine months of 2024, Life & Health new business value (NBV) grew 34.1% year-on-year, and NBV per agent grew by 54.7%.

Ping An has leveraged its integrated finance advantages to expand its rural network channels and deliver financial services to residents in rural regions.

As of the end of 2023:

• P&C provided services to nearly 2.3 million small and medium-sized enterprises (SMEs)

• Ping An Bank granted loans to more than 1.3 million small and micro-businesses.\

In 2023:

• Ping An’s inclusive banking business reached RMB718 billion, an increase of 10% year-on-year

• Inclusive investment reached RMB22.9 billion, an increase of 180% year-on-year. Premium income of inclusive insurance reached RMB14 billion

Case 1: IoT and RS satellites help MSMEs get credit

Due to a lack of loan collaterals and reliable credit information, micro-, small and medium-sized enterprises (MSMEs) face challenges in raising funds required for business expansion and production upgrades. It is difficult and risky for financial institutions to review financing applications from MSMEs due to long industrial chains, numerous cross-regional businesses, difficulties in due diligence, and receivables that are small amounts and high frequency.

Ping An Bank built a satellite network platform to support the development of inclusive finance. The Internet of Things (IoT) satellites Ping An-1 and Ping An-2 can improve the data communication in forests, grasslands, deserts, oceans and other areas where ground signals are missing. The Remote Sensing (RS) PingAn-3 can obtain high-resolution image data. These satellites work together to help the Bank grasp real operational data in the upstream and downstream of the supply chain more effectively upon corporate authorization and also help the Bank to assess loan risks.

Case 2: Insurance for new urban workers

Urbanization is a substantial trend in China, with the population growth of new urban residents. These new urban residents immigrate to cites from rural areas and pursue low-income labor work, such as construction, food delivery, and car-hailing drivers. To address the emerging demands of insurance from this urbanization trend, Ping An has launched a series of exclusive products for new urban residents. For example, Ping An Property & Casualty (P&C) launched a series of work accident insurance products.

Our social responsibility initiatives are based on a combination of business logic and social benefits, not only financial donations or philanthropy.

Ping An’s efforts in rural revitalization is a good example of this combination. Ping An has been providing more accessibility to financial services for communities in rural areas by issuing Rural Revitalization Debit Cards, and linked value-added benefits to the cards, including personal accident insurance, and 24/7 online medical consultations. By 2024, Ping An issued more than 240,000 cards for rural communities, which supported inclusive finance and brought customers to Ping An Bank.