On 30 December 2020, Shandong Energy held the 2021 Annual Work Meeting in Taian. By conscientiously implementing the spirit of the Fifth Plenary Session of the CPC 19th Central Committee and the Central Economic Work Meeting, and implementing the arrangements of Shandong CPC Committee’s Economic Work Meeting, the meeting summarized the reorganization and work since the 13th Five-Year Plan, and arranged for 2021 and the target tasks of 14th Five-Year Plan. The meeting mobilized entities and employees at all levels to embark on a new journey, take on new missions, seize new opportunities, and demonstrate new deeds in order to strive to achieve a good start to the "14th Five-Year Plan" and build a global clean energy supplier and a world-class energy group.
Chairman Li Xiyong attended the meeting and delivered a speech. He pointed out that since the 13th Five-Year Plan, through earnestly implementing the spirit of the CPC Central Committee’s instructions on deepening the reform and development of state-owned enterprises, and fully implementing Shandong CPC Committee’s and provincial government’s decision-making and deployment and the provincial SASAC’s work requirements, entities at all levels must bear in mind the importance of developing state-owned enterprises. The original mission is to scientifically grasp the macroeconomic situation and market development trends. Entities at all levels moved forward courageously, made breakthroughs, and completed the goals and tasks of the "13th Five-Year Plan" ahead of time, thus making positive contributions to ensuring the province's energy strategic security and promoting economic and social development. Shandong Energy has gone through an extremely difficult and extraordinary five years, and the overall work presents the following "Nine Highlights". First, we have completed the reorganization smoothly and efficiently to realize the strategic plan of Shandong CPC Committee and provincial government. Second, Shandong Energy's scale has risen sharply, and its comprehensive strength ranks in the forefront of the industry. Third, our major scientific and technological projects have achieved breakthroughs, and technological innovation has led the development of the industry. Fourth, a few key projects have been put into production and achieved results, and the potential for enterprise development has been significantly enhanced. Fifth, the development advantages of the replacement of old growth drives with new ones are concentrated, and Shandong Energy has taken solid steps in its transformation and upgrading. Sixth, our reform and restructuring are at the forefront of state-owned enterprises, and development bottlenecks are effectively solved. Seventh, the reorganization has expanded the space for development, and asset securitization has achieved remarkable results. Eighth, the construction of production bases outside Shandong Province has achieved fruitful results, and international development has become a global model. Ninth, the leading role of party work is fully demonstrated and corporate social responsibility is fully fulfilled. Especially since the reorganization, Shandong Energy are more courageous to face and solve problems and difficulties, and not back down. It has accomplished a number of key development matters, tackle down a number of urgent and difficult events constraining growth, and achieved remarkable development. These achievements are hard-won. This is the result of the correct leadership of Shandong CPC Committee and the Provincial Government, the result of the care and support of the Provincial SASAC, and the result of the unity and hard work of entities at all levels and all employees.
After comprehensively analyzing the current situation, Mr. Li Xiyong emphasized that in the new stage of Shandong Energy's development, opportunities and challenges are intertwined, and advantages and shortcomings coexist. In accordance with the policy of "base on a new starting point, grasp new opportunities, and achieve new development", we must work together, forward-looking thinking, strategic layout, and overall advancement, and comprehensively amplify the effect of the reorganization, so that we can create new glory and create new chapters.
We should bravely undertake the mission of "one guarantee and two optimizations", that is, to guarantee our province's energy security, optimize energy distribution and energy structure. We must make our "six pillar industries" better and stronger and maintain the first echelon of the coal industry. We must try our best to become a club of trillions of assets and trillions of revenue, so that we will become the "leader" of the innovation and development of Shandong's energy industry, the "demonstrator" of the deepening reform of the energy structure, and the "first mover" of the leap-forward development of emerging industries.
Our goal is to construct a "seven first-class" energy group. That is, the first-class energy group with strong economic strength and outstanding brand image; the first-class energy group with an efficient development model and leading quality and efficiency; the first-class energy group with a reasonable layout and comprehensive integrated development; the first-class energy group with leading core technologies and strong innovation capabilities; the first-class energy group with sound systems and mechanisms and standardized corporate governance; the first-class energy group with strong party leadership and open and inclusive culture; the first-class energy group with shared development results, safety, stability and harmony.
We must vigorously implement development strategy in three steps. The first step is the integration and optimization period (2021-2023), the second step is the integration upgrading period (2024-2025), and the third step is the high-quality development period (2026-2030). At the end of the three periods, total assets and operating income increased by more than 30%, profitability doubled, corporate scale strength and social reputation increased significantly, and the status of the Fortune Global 100 enterprises was consolidated and improved.
We will build a regional layout of "one core, three bases and four platforms". Namely: "One Core": Shandong Headquarters will be established a strategic core for the replacement of old growth drives with new ones and leading high-quality growth. "Three Bases": Shaanxi-Gansu-Inner Mongolia, Australia, and Xinjiang will be built industry-leading industrial support bases that help optimize the energy structure of our province. "Four Platforms": Jinan, Qingdao, Shanghai, and Hainan are innovative cluster platforms with leading business models and open cooperation.
Mr. Li Xiyong emphasized that the construction of "seven first-class" energy group and the implementation of the "three-step" strategy are a systematic deployment of Shandong Energy based on the reality of the reorganization, focusing on the "14th Five-Year Plan" and middle and long-term quality development. As long as we maintain strategic determination and strategic vision, keep our feet on the ground, work hard and concentrate our efforts, we will surely be able to turn the grand blueprint into a better reality and create a brighter future!
Mr. Li Xiyong pointed out that 2021 is a critical year for Shandong Energy to leverage its integrated advantages, accelerate structural adjustment, and improve development quality and efficiency. The goal of the whole year’s work is to follow the spirit of the 19th National Congress of the CPC and the spirit of the 2nd, 3rd, 4th, and 5th Plenary Sessions of the 19th National Congress of the CPC Central Committee, and earnestly implement the arrangements of the Economic Work Meetings of CPC Central Committee and the Shandong CPC Committee. Shandong Energy will closely follow the main theme of "based on a new starting point, grasp new opportunities, and achieve new development". Adhere to reform and innovation as the fundamental driving force, Shandong Energy will make the six pillar industries better and stronger. Shandong Energy will coordinate the "four major relationships", namely, pandemic prevention and economic development, real economy and capital operation, industrial management and regional management, security and stability, and reform and development. Shandong Energy will strictly adhere to the “four bottom lines” of safe production, environmental protection, stability and integrity. Shandong Energy will implement the "five major hedgings", namely, industrial hedging, product hedging, financial hedging, funding hedging, and cost hedging. Shandong Energy will promote the "three transformations" of development, management and control, and production organization. Shandong Energy will carry out the five "Annual Management Improvement" activities of safety rectification, slimming and strengthening, synergy, structural optimization, and cultural integration. In 2021, Shandong Energy strives to achieve a coal output of 300 million tons, an operating income of more than RMB700 billion, and a total profit of more than RMB20 billion, so as to celebrate the 100th anniversary of the founding of the CPC with excellent results in the year 2021.
Li Xiyong emphasized that in 2021, we will focus on seven key tasks: First, in order to promote the advancement of the industrial base, the modernization of the industrial chain, and create the "acceleration of the replacement of old growth drives with new ones", by making a "big article" on doing a good job in extending the production chain, supplementing the chain, and strengthening the chain, we will focus on the layout of the provincial top ten industrial advantage clusters, and focus on the six major industries, and we must resolutely eliminate lagging growth drives, transform and upgrade traditional growth drives, cultivate and grow new ones. Second, we must place innovation at the core of the overall development of the group, enhance scientific and technological innovation capabilities, enhance talent support capabilities, release the potential for digital transformation, and strive to win opportunities and initiative in a new round of high-quality growth. Third, we must conscientiously implement the three-year action plan on the state-owned enterprise reform of the CPC Central Committee and Shandong Province, focus on the shortcomings of the system and mechanism that restrict the development of enterprises, make up our minds and implement the "four reform breakthroughs" vigorously, namely, the management and control system, mixed ownership, human resources and remuneration, in order to truly restore vitality, motivation, and efficiency. Fourth, to revolve around the principle of subtracting inventory optimization and adding incremental leapfrogging, we must innovate the "resources + capital" development model to promote faster enterprise development, higher quality, better efficiency, and better structure. Fifth, we must benchmark the first-class management improvement action as the starting point. We must deepen the “Two Integration” of marketization and lean management. We will coordinate the three relationships of "quantity, cost, and profit", and do a good job in the three "production, supply, and sales" in order to build a full value chain management system. Sixth, by establishing a bottom line thinking and red line awareness, we must unswervingly build a safe production, ecological and environmental protection line, so as to consolidate the basic guarantee for enterprise reform and development. Seventh, by fulfilling the general requirements of party building in the new era, focusing on the implementation of the "14th Five-Year Plan" and next year's mission goals, we must shoulder the political responsibility of administering the party strictly, consistently upholding party leadership and strengthening party building, in order to provide political and organizational guarantees for the reform and development of the group.
Mr. Li Xiyong also put forward clear requirements, involving the construction of the quality, ability and style of management, and coordinating various tasks at the end of the year.
Mr. Man Shengang, General Manager of Shandong Energy and Deputy Secretary of CPC Shandong Energy Committee presided over the meeting. He asked entities at all levels to stand at the height of the group's development, continue to optimize the "14th Five-Year Plan" and work ideas for 2021, further mark key and difficult points, clarify work ideas and the way forward. It is necessary to focus on comparative advantages, carry on the new mission of leapfrog development, unify thinking on the decision-making and deployment of energy groups, unify the goals and requirements for next year, strengthen confidence, seek advantages and avoid disadvantages, make precise efforts and act actively. Entities at all levels must focus on their comparative advantages, take up the new mission of leapfrogging development, unify their thinking to the group's decision-making and deployment, unify the goals and requirements for next year, strengthen confidence, seek advantages and avoid disadvantages, make precise efforts and act actively. Entities at all levels must focus on additive increments, promote new breakthroughs in scale equivalents, resolutely fight safe production defenses, speed up mine procedures, focus on the relocation of villages on the coal mines, and promote in-depth coordination of production and sales. Entities at all levels must focus on cost reduction and expand new space for cost control. At the same time, the implementation of cost reduction for controllers, cost reduction for management, cost reduction for finances, and cost reduction for policies are implemented to open up "blocking points" and "pain points" to stop "bleeding points". Entities at all levels should focus on multiplication to create benefits and stimulate new vitality in economic operations. In particular, in terms of operation and management, we should focus on the six major synergies, fundamentally break the institutional constraints and control boundaries of synergy, and continue to amplify the effect of synergy. Entities at all levels should also focus on division and weight reduction in order to reshape value and create new advantages. At the same time, we need to highlight the advantages of resources to gather in the six main businesses, by promoting loss-making companies to turn losses and reduce losses, clean up non-main business assets, inefficient and ineffective assets, and promote comprehensive risk management so that companies can achieve more efficient, higher quality and more sustainable growth. In addition, we must also focus on supervision and assessment, and improve the implementation of new results. We must keep an eye on the goals and implement them, clarify responsibilities and implement them, strengthen supervision and assessment, and force the work to achieve results. We should focus on the typical lead, consolidate the pioneering efforts to strive for excellence, strive to build a global clean energy supplier and a world-class energy group, and greet the CPC's centennial birthday with outstanding results!
At the meeting, Mr. Li Xiyong and Mr. Man Shengang respectively signed the 2021 safe production target responsibility letter and business target responsibility letter with relevant entities. Mr. Yue Baode, director of Shandong Energy and deputy secretary of CPC Shandong Energy Committee conveyed the key points of safe production and performance evaluation policies in 2021. Mr. Wang Qian, General Manager of Yongfeng Steel and Secretary of CPC Yongfeng Committee shared experience on business operation.
During the meeting, the participants had a group discussion around the speech of Mr. Li Xiyong. Everyone agreed that the meeting is an event that sets direction, goals and ideas. It is a meeting that boosts confidence, enthusiasm, and morale, with responsibility, mission, and feelings. Everyone unanimously expressed that they would put their own enterprises’ development in the overall situation of Shandong energy to plan, promote, and implement, firmly translate the group's requirements into specific results of production and operation, and ensure that various objectives and tasks are implemented and completed on schedule.
The meeting was held in video format. Members of CPC Shandong Energy Standing Committee Mr. Zhang Baocai, Mr. Zhang Ruoxiang, Mr. Zhou Hong, Mr. Liu Yuanchao, Mr. Le Jianghua, Counselors, deputy chief officers of the group level and above, heads of the headquarters department (center), heads of the party and administration of the secondary companies (subordinates), leaders in charge of safe production, finance and technology attended the meeting in the main venue.