Midea Building Technologies Commits to Science-Based Targets Initiative

SBTi is a globally recognized initiative launched by the UN Global Compact (UNGC), the Carbon Disclosure Project (CDP), the World Resources Institute (WRI), and the World Wide Fund for Nature (WWF). The organization empowers businesses to set emission reduction targets in line with scientific standards to combat climate change. It enables the private sector to take scientifically-based action that limit global warming to 1.5°C. As of today, more than 20% of global Fortune 500 companies have established their SBTi-validated emissions targets. 

Forming a Value Loop Through ESG-Driven Benefits

Over the next 24 months, Midea Building Technologies will develop emissions reduction targets grounded in climate science throughout its entire value chain, which will then be submitted to SBTi for validation.

Midea Building Technologies has been consistently exploring green and low-carbon initiatives in the past two years, emphasizing net-zero production lines, workshops, manufacturing campuses, and products. The company’s intensified commitment to its green transformation and ESG performance has been acknowledged on the national level through China’s “Green Factory” and “Green Supply Chain” certifications. Midea Building Technologies also established the Group’s first “Carbon-Neutral Production Line” and “Carbon-Neutral Building”, pioneered the industry’s first “Carbon-Neutral Heat Pump”, and has been listed in Guangdong province’s carbon-peaking pilot projects.

Following its official pledge to SBTi, Midea Building Technologies will further its sustainability transformation to address climate change. The company is reaffirming its ongoing use of green and renewable materials, including recycled plastics and sustainable raw materials, along with the adoption of low-GWP refrigerants like R454B and R290. Another key strategy is building a green supply chain system by adding environmental performance metrics into supplier evaluations, promoting eco-friendly transportation, and advocating for annual carbon reduction from core suppliers. In terms of resource efficiency, Midea will support a more circular economy, recover and recycle refrigerants, and implement wastewater recycling. Initiatives will extend to the construction of waste-free workshops and the reduction of plastic packaging.

On the equal development front, Midea will empower supply chains with green services, such as providing access to carbon management platforms and supporting suppliers to procure green supply chain certifications. Midea is also amplifying community engagement with sustainability-themed initiatives. These include extending carbon credits and low-carbon travel initiatives to employees and suppliers, hosting community events and volunteer schemes, and establishing annual sustainable training programs for suppliers. Regarding green design, an audit process will be introduced to evaluate the level of environmental compliance, carbon footprint, energy efficiency, and overall environmental impact of new Midea products.

Embracing the Green Transformation: Zero-Carbon Projects

Recognizing the imperative of its own digital and green transformation, Midea has been leveraging its existing advantages to navigate the current challenges of China’s industrial transformation. The company has embraced China’s dual-carbon goals and established several net-zero pilot projects. Anchored in Midea Building Technologies’ robust product ecosystem, the West District of Midea Industrial Park has deployed cutting-edge technologies to realize low-carbon operations production, transforming the area into a fully digitized, efficiently operated, and sustainable infrastructure. These implemented measures include distributed PV power generation initiatives, energy storage and cooling solutions, V8 VRF and other advanced HVAC equipment, LINVOL intelligent elevators, energy recovery modules, and automated electrical control box assembly lines. 

Another Midea pioneering pilot project, the Chongqing Midea General Refrigerating Equipment Co. Ltd (hereafter known as Chongqing Factory), has also forged an intelligent and net-zero path through continuous practice. By prioritizing green electricity while pushing for emissions reductions with carbon offsetting as a supplementary practice, the Chongqing Factory has introduced a robust zero-carbon planning initiative spanning various fronts. From innovations in energy-efficiency management to increased proportions of renewable energy usage, digital energy management progress, and explorations into carbon-free resources, the factory’s practices have enabled its zero-carbon factory milestone and attainment of the PAS2060 carbon neutral certification.

ESG Commitments to Drive Sustainability

Midea Building Technologies has also taken the lead in initiating the national standardization of “Energy Storage Thermal Management and Refrigeration (Heat Pump) Units” (20232479-T-604) and “Testing and Evaluation Methods for Thermal Storage Air Conditioning System” (20233591-T-604), both of which have been approved by the Standardization Administration of China. In particular, the “Energy Storage Thermal Management and Refrigeration (Heat Pump) Units” marks the very first national-level energy storage standard spearheaded by Midea Group. The establishment of the two standards is expected to bridge a significant gap within the industry and propel the development of standardized practices, playing a pivotal role in constructing China’s new energy system and carbon-peaking efforts.

The “Caijing China ESG Innovation Insight Report”, released in December 2023 by Caijing Magazine and Caijing Business Governance Research Institute, points out Midea’s trailblazer status in ESG transformation. Through innovative models, Midea has been “leading by example” in the realms of technology manufacturing, energy, internet, cloud computing, and healthcare, showcasing remarkable cross-industry ESG capabilities. Midea’s approach involves sharing its experiences, capabilities, and strengths with external partners. These collaborative efforts extend beyond the conventional digital transformation narrative in industrial manufacturing, encompassing services in carbon consulting and carbon management tailored for industrial and building-related sectors. The approach empowers collaborators by reducing costs, increasing efficiency, and propelling China’s manufacturing onto the global stage.

Looking ahead, Midea Group pledges to maintain a transparent disclosure of its climate actions and emissions reduction progress. On top of publishing its annual sustainability report, Midea will continue to uphold progressive corporate governance practices and remain dedicated to addressing key ESG issues. The company will establish an ESG execution team with specialized sub-committees to foster collaboration between divisions through matrix management. Midea is committed to driving continuous improvement of its sustainable objectives.