Second-Party Opinion Download

Sustainalytics is of the opinion that the Xiaomi Corporation Green Finance Framework is credible and impactful and aligns with the four core components of the Green Bond Principles 2021 and the Green Loan Principles 2021. This assessment is based on the following: 

USE OF PROCEEDS

The eligible categories for the use of proceeds –Eco-efficient and Circular Economy Adapted Products, Production Technologies and Processes, Energy Efficiency, Green Buildings, Clean Transportation, Pollution Prevention and Control and Renewable Energy – are aligned with those recognized by the Green Bond Principles and the Green Loan Principles. Sustainalytics considers that investments in the eligible categories will help reduce carbon emissions of Company operations in China and advance the UN Sustainable Development Goals, specifically SDG 7, 9, and 12. 

PROJECT EVALUATION / SELECTION

Xiaomi Corporation’s internal process for evaluating and selecting projects will be carried out by the Green Financing Team, which consists of executive managers across different business units, as well as senior managers within the Company. This evaluation and selection process will be implemented on an annual basis. The Corporate Governance Committee will give the final approval on the projects selected. Sustainalytics considers the project selection process in line with market practice. 

MANAGEMENT OF PROCEEDS

Xiaomi Corporation’s Corporate Governance Committee and Group Financial Controller will use the Company’s internal information system to track the use of proceeds on an annual basis. Unallocated proceeds will be held in line with Xiaomi’s liquidity management policy, which will be in the forms of cash and cash equivalents, short-term bank deposits, short-term investments measured at fair value and long-term bank deposits. This is in line with market practice. 

REPORTING

Xiaomi Corporation intends to report on the allocation and impact of proceeds on its website or in the Green Bond Report on an annual basis until full allocation. Allocation reporting will include the aggregate amount allocated, the remaining unallocated balance, the proportion of net proceeds allocated to financing vs refinancing, and type of temporary investment and project examples where feasible. In addition, Xiaomi Corporation is committed to reporting on relevant impact metrics. Sustainalytics views Xiaomi Corporation’s allocation and impact reporting as aligned with market practice.