Sustainability
Welhunt is a global trader of bulk materials, located in the middle of the value chain and trading on a business-to-business (B2B) basis. We work together with upstream commodity suppliers to provide downstream clients with high-quality and high-value products in sufficient quantities that help them achieve their business and production targets. The suppliers of energy products are distributed across countries such as Australia, Indonesia, South Africa, the United States, and Canada. Meanwhile, the suppliers of steel products are located in Taiwan, China, and Vietnam. Agricultural products come from Australia, while mung beans and cashews are sourced from Cambodia.
Product certification and regulations
In order to protect the safety of our customers and prevent potential hazards, Welhunt provides products’ Material Safety Data Sheet (MSDS) for our customers. This document provides recommendations for product use or storage to our customers, including a description of the appearance, composition, product characteristics and the hazards that the relevant components may cause to the human body, and suggestions for precautions and hazard prevention measures. In addition, due to the flammable nature of traditional energy, the MSDS also suggests storage methods and fire prevention measures.
Besides, Welhunt will appoint an independent and credible international inspection organization (such as SGS, BV, IOL, ALS, Sucofindo, and Geoservice) to conduct quality inspections and issue various inspection reports during the loading and discharging of traditional energy shipments. These reports include the certificate of sampling and analysis (COA), certificate of hold cleanliness (COHA), draft survey report (DSR), certificate of origin (COO), and certificate of weight (COW). It enhances transaction security by allowing both parties to verify compliance with contract requirements for the purchased goods.
As for steel products, Welhunt’s test results for all items are in line with the Chinese National Standards (CNS), which cover steel product information, mechanical properties, and chemical composition, among others. During a transaction, Welhunt will also ensure the quality and safety of each batch of products and provide standard certificates to clients to fulfill our corporate responsibility.
Counterparty’s ESG Assessment
The ESG performance of counterparties is a key aspect of Welhunt’s value chain management. While ensuring alignment with commercial interests, Welhunt expects its counterparties to adopt best practices in governance, environmental stewardship, and social responsibility. Below are Welhunt’s management measures regarding counterparties’ ESG performance:
KYC questionnaire design and distribution | Before establishing a business relationship with new counterparties or those with whom we have had no interactions for over a year, we issue a KYC questionnaire. This questionnaire covers detailed inquiries about their business operations, financial status, and commercial background to ensure a thorough understanding of their operational model and risk exposure. Starting in 2023, we officially incorporated questions related to Environmental, Social, Governance (ESG) factors and performance disclosure into the KYC questionnaire to more comprehensively assess counterparties’ sustainability performance and risks. In 2023, Welhunt distributed KYC questionnaires to 100% of new or long-inactive counterparties. |
ESG risk assessment and monitoring | By incorporating ESG-related questions into the KYC questionnaire, we can comprehensively evaluate our counterparties’ environmental impact, social responsibility, and governance performance. This includes their environmental policies, labor conditions, ethical business standards, and measures to prevent child labor and eliminate all forms of forced or compulsory labor. In addition to this, we closely monitor global market changes and regulatory shifts, as well as their potential impact on our counterparties, ensuring that we can respond promptly to any emerging risks. |
Welhunt analyzed the sustainability-related questions filled out by potential trading partners in the KYC questionnaire and found that the counterparties had better performance in the social and governance aspects, with over 75% of respondents indicating that they had relevant systems and measures in place for most questions. We speculate that this is primarily because they have already undertaken corresponding work in corporate social responsibility, establishing a relatively comprehensive social responsibility system and governance structure.
In terms of environmental aspects, 76% of potential trading partners indicated that they were implementing actions such as energy conservation, water conservation, waste recycling and reuse, and preventing air and soil pollution. Although currently, less than 20% of respondents have further conducted projects such as climate risk identification, product water footprint, and carbon footprint calculation, we have also found that some counterparties, like Welhunt, have made commitments to carbon reduction or achieving net zero.
We believe that this measure will help our future partners in the value chain to better understand the importance of ESG performance for sustainable business operations. In the future, Welhunt will continue to maintain close contact with trading partners to explore how to enhance their performance in ESG or assist in formulating sustainable development goals and corresponding action plans. At the same time, we will consider providing feedback on ESG assessment results to the trading partners who completed the questionnaire, to raise their awareness of ESG issues and further encourage them to take proactive actions to improve their sustainable performance. Through these efforts, we look forward to working hand in hand with trading partners to achieve sustainable development goals.