Second-Party Opinion Download

Sustainalytics is of the opinion that the Redco Sustainable Finance Framework is credible and impactful and aligns with the Sustainability Bond Guidelines 2018, and Green Loan Principles 2020. This assessment is based on the following:

USE OF PROCEEDS

The eligible categories for the use of proceeds – Green Buildings, Energy Efficiency, Sustainable Water and Wastewater Management, Pollution Prevention and Control, Renewable Energy, Climate Change Adaptation, Clean Transportation, Affordable Basic Infrastructure, Access to Essential Services and COVID-19 Related Investments and Expenditures – are aligned with those recognized by both the Sustainability Bond Principles and the Green Loan Principles. Sustainalytics believes that the eligible categories are expected to improve the environmental performance the Company’s operations and advance the socioeconomic development of China while advancing the UN Sustainable Development Goals (SDGs), specifically SDG 3, 4, 6, 7, 8, 11, 12.

PROJECT EVALUATION/SELECTION

Redco’s Eligible Projects will be evaluated and selected by the Sustainability Taskforce, which will be reviewed semi-annually and is comprised of senior members from various departments: design management, human capital, procurement, operational and sales, branding as well as corporate finance. The Product Department Product Department will be responsible for identifying Eligible Projects and submitting them to the Sustainability Taskforce for review. Sustainalytics considers the project selection process as in line with market practice.

MANAGEMENT OF PROCEEDS

Redco will establish an internal tracking system which will be used to track the use of proceeds for each transaction associated within the Framework. Allocation of proceeds will be managed by Redco’s Sustainable Finance Management Team which is comprised of Financial Management, Treasury Management, Internal Risk and Control and Compliance departments. Pending allocation, proceeds will be invested according to the Group’s standard liquidity policy in short-term deposits or investments. The Group intends to allocate proceeds within two years of issuance. This is in line with market practice.

REPORTING

Redco intends to provide an annual allocation on its website on an annual basis until full allocation. The allocation report will include (i) a list of eligible green and social projects, (ii) the amount of proceeds allocated to each Eligible Green and Social Project category, (iii) descriptions of Eligible Green and Social Projects financed, (iv) selected examples of projects financed, and (v) the total amount of unallocated proceeds. In addition, Redco is committed to reporting on relevant impact metrics where feasible. Sustainalytics views Redco’s allocation and impact reporting as aligned with market practice.