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China Foods and its subsidiaries are committed to energy conservation, emission reduction, and overall environmental protection, and to fulfilling their social responsibilities by implementing environmentally friendly processes in all business and operational procedures. They have established a long-term management system that takes into consideration the responsible use of water resources, promotion of efficiency in energy consumption, and minimization of packaging, and in this way is realizing sustainable development. China Foods uses only the most advanced environmental management systems developed both domestically and internationally, and endeavors to standardize and rationalize environmental management across the board. To this end, all four subsidiaries are ISO14001 accredited.

All subsidiaries have implemented a water resources supervision mechanism so as to ensure responsible use of water. For example, water consumption per ton of wine in the China Foods wine subsidiary is lower than the industry average, as it makes effective use of recycled water. Water

conservation in the beverage division leads the industry.

China Foods subsidiaries have utilized special funding provisions in the company budget to complete technological adjustments and process optimization with a view to eliminating technology and processes that involve high levels of energy consumption, and have been able to bolster energy consumption efficiency with the use of new technologies and updated equipment. Overall, China Foods’ energy consumption per 10,000 yuan of added value dropped 44.6% over 2005. Operation costs decreased, and the direct and indirect emission of pollutants also fell.

China Foods focuses on minimal packaging, and requires all subsidiaries to realize a reduction in packaging materials, maximize recycling, and reduce environmental pollution.

Across all subsidiaries, improved technology has rendered equipment more efficient. In terms of logistics arrangements, China Foods ensures the use of the best transport routes with a view to reducing emissions of greenhouse gases and solid waste, and eliminating pollutants so as to better protect the environment.