Key Drivers

1. Stringent Corporate Governance

Corporate governance is the backbone of our value system. We firmly believe that stringent

corporate governance is the key to ensure high level of management performance and sustainable

development of the Companies.

Corporate policy

To uphold the interests of different stakeholders, NWFB and Citybus adhere to the highest standard

of corporate governance for business practices. The corporate decision-making process is based on

transparency, integrity, fairness and professional supervision.

Management strategy

We value our employees, environment and society and have been integrating quality bus services,

staff and community cares, occupational safety and health and environmental protection into the

Companies’ operations with the most stringent corporate governance, striving to create shared

values for our stakeholders.

To enhance our customers’ experience, NWFB and Citybus have invested heavily in bus fleet

replacement. Also, by introducing new technology for workflow improvement and developing big

data solutions, the Companies are able to enrich provision of real-time operational information,

improve bus waiting environment for passengers and enhance bus safety, as a result giving

passengers a safer and more comfortable travelling experience, and building Hong Kong as a Smart

City.

Management team

To achieve the best corporate governance, NWFB and Citybus are served by a professional

management team upholding high ethical values in their code of conduct as well as acquiring

expertise in their respective fields.

NWFB and Citybus' stakeholders

With an aim to pursue service excellence, NWFB and Citybus are committed to communicating

with, listening to, and learning from our stakeholders such as:

* Employees

* Customers

* Government

* Legislative Council and District Councils

* Interest groups

* Media

* Suppliers

Procurement and tendering process

The Companies promote open competition for their procurement needs, with contractual

relationship based upon fair and reasonable contract terms. Procurement and tendering activities are

based on the following principles:

* Impartial selection of capable and responsible suppliers and contractors;

* Effective use of competition;

* Selection of appropriate contract types according to needs;

* Compliance with laws, relevant regulations and contractual obligations;

* Adoption of an effective monitoring system and other management controls to detect and

prevent bribery, fraud or other malpractices in the process of procurement and tendering;

* Prohibition of bribery and corruptive practices.

Stakeholders engagement

NWFB and Citybus actively establish open, interactive and sustainable communication channels

and maintain good communication with our customers and stakeholders. By listening to their

opinions towards our services, the Companies are able to realize opportunities ahead and perform

risk management for long-term business development and sustainable growth of the society.

External communication channels:

* Customer Services

Citybus NWFB

24-hour hotline 2873 0818 2136 8888

Hotfax 2857 6179 2136 2136

SMS enquiry service 9751 8282 9526 1111

Website www.citybus.com.hk www.nwfb.com.hk

E-mail webmaster@citybus.com.hk bus_ideas@nwfb.com.hk

* Publish the Companies’ information through the company website and social media platforms.

* Organize bi-monthly Passenger Liaison Group Meetings to gauge passengers' opinions.

* Well-established complaint handling mechanism and procedures are in place to follow up and

investigate customers’ complaints, and provide responses within a specified timeline.

* Maintain good communication and relationship with media by various means, such as press

releases, press conferences, press visits and feature stories, etc.

* Regular meetings with government departments and regulatory bodies (different natures of

meetings with the Transport Department, District Councils' Traffic & Transport Committee and

Public Transport Liaison Group meetings, Legislative Councils meetings, and Working Group on

Access to Public Transport by People with Disabilities meetings coordinated by the Transport

Department).

Internal communication channels:

* Two-way communication system with staff members has been set up to review operational

processes and to identify room for improvement. Various communication channels are in place to

converse with the employees, such as staff hotline, regular publication of newsletter, staff handbook,

staff Joint Consultative Committees ("JCCs") of Citybus, and regular meetings with unions.

* NWFB and Citybus' Intranet is available to all employees and includes a wealth of information

on company's news and activities.

* Orientation seminars/trainings, including lectures on corporate culture are provided for all new

join staff to quickly familiarize themselves with the Companies’ daily operations and policies.

Major CSR reporting system

We communicate with our stakeholders regularly with the following means:

* Fuller Disclosure

* Websites at www.nwfb.com.hk (NWFB) and www.citybus.com.hk (Citybus)

* Staff newsletter

* Policy and manual (procurement, occupational safety and health, sustainability, etc.)

* Brochure/ leaflet/ supplement of different themes

* Regular reporting to the Transport Department (e.g. monthly operating report, monthly bus

accident record)

* NWS Sustainability Report

2. Quality Bus Services

NWFB and Citybus are committed to providing the best possible public bus services in Hong Kong.

To achieve this, we have been making every effort and taking initiatives on different aspects.

Barrier-free bus trip

Upholding the vision of “Accessibility for all”, NWFB and Citybus are committed to upgrading bus

facilities and enhancing our service standards to create a “barrier-free” travelling environment that

meets the transport needs for all passengers. There are coherent railings in bright colors in bus

compartment to ensure passenger’s safety. The entire fleet of low floor buses is equipped with a

braille plate with customer service information on it for the visually impaired. Besides, “priority

seats”, fixed ramps as well as one or two wheelchair parking spaces with backrest and safety belts

are available, uplifting the accessibility for the disabled. All bus captains receive comprehensive

trainings ranging from quality customer service to skills at serving the elderly and disabled

passengers.

NWFB and Citybus actively introduce new technologies for easy access of the Companies’

information by the public. “Next Bus” arrival enquiry service has fully covered all routes while

“Delay Indicator” and “Incident Mode” features were introduced in 2019, which provide additional

bus journey information. “Motion Bus Route Display Panel” is equipped at bus compartment,

providing bus stops information, bus fares as well as estimated arrival time at en-route bus stops

and common stop interchange routes. Besides, “Automatic Bus Stop Announcement System” is

upgraded to connect with the Octopus Fare Collection System, applying GPS location signal to

adjust route direction and section fares automatically.

To further improve bus waiting environment for our passengers, NWFB and Citybus have

completed installation of passenger seats at suitable bus stops on Hong Kong Island corresponding

to the government’s policy. Besides, the Companies have set up designated area at around 160

en-route bus stops on Hong Kong Island to facilitate wheelchair passenger for boarding the bus with

priority.

Fare concessions

NWFB and Citybus offer various fare concession schemes in response to passengers' needs,

including:

* Octopus Bus-Bus Interchange (“BBI”) schemes, in which most of the BBI schemes provide

free interchange

* Half fare discount for senior citizens and children

* Cityflyer Same Day Return Discount

* Section fare schemes

* Government Public Transport Fare Concession Scheme for the Elderly and Eligible Persons

with Disabilities

* Citybus passengers aged 60-64 may continue to enjoy the Sundays and Public Holidays $2

Concession and the Mondays to Saturdays half fare discounts on Citybus Hong Kong Island Routes

as well as Shenzhen West Express Routes (except Harbour Crossing Routes and Racecourse Routes)

on the condition that they pay with a Personalized Octopus.

(For detail of different fare concession schemes, please visit the section under “Fare Concessions”)

24-hour service team

NWFB and Citybus have established a 24-hour Operations Control Centre, together with a team of

professional outbound inspectors patrolling around, to monitor our bus services and daily operations

in all districts. The Operations Control Centre is responsible to collect, record and disseminate

instant traffic information, so as to make necessary arrangements to fulfil operational needs. It shall

timely notify the Company on any emergency to facilitate effective assessment and prepare for

possible emergency action. The Operations Control Centre could send message to buses on the road

through the instant communications device and bus captains can read the message from the bus stop

announcement system control unit available at the driving cab when they are not in driving, and be

notified of the most updated operational arrangement such as road diversion notices.

Stringent vehicle maintenance

It is our prime objective to maintain our buses in the safest and most reliable condition. Apart from

Certificate of Roadworthiness and Certificate of Fitness examinations required for the licensing of

buses, NWFB and Citybus also strictly follow the Transport Department's requirement of inspecting

every franchised bus at least once a month. Thorough inspection is carried out on every franchised

bus annually, ensuring the entire bus fleet in the safest and most reliable condition. Joining the

Vehicle Maintenance Workshops Charter launched by the Electrical and Mechanical Services

Department from 2012, we pledge to abide by the Practice Guidelines for Vehicle Maintenance

Workshops that stipulate service requirements in technical, environmental, safety, training, service

and documentation aspects, dedicating to improving the quality of vehicle maintenance and

ensuring vehicle safety.

Besides, the Companies have set multiple service indicators, including operational performance,

mechanical reliability and availability of well-functioning buses, and have achieved the target

standards. Company staff are provided with up-to-date safety tips and advice through staff

newsletter.

Bus safety measures

Safety is always the top priority of NWFB and Citybus. “Safety Committee” is set up to review and

oversee safety measures, including bus operations, maintenance of buses, staff training and

recruitment.

The Companies endeavour to enhance fleet management and bus safety with new technology. All

buses are equipped with speed limiting function, restricting the maximum speed on level ground to

70km/h. By strengthening the usage of GPS Tachograph, the Companies could generate records of

instances of harsh braking and excessive speeding for following up with bus captains. The

Companies also extended the speed monitoring scope to cover all road sections operated by our bus

routes and provide real-time sound alerts to bus captains, further improving safety in conjunction

with a random spot-checks system. Besides, safety messages are broadcast randomly through the

control panel at the driving cab to remind our bus captains to stay alert.

To further enhance bus safety, all new buses are equipped with electronic stability control, active

speed limiting system and safety belt on all seats. Such devices have become the standard

specification for new buses. Besides, the Companies have conducted a trial of “Advanced Driver

Assistance System” on buses, utilizing visual intelligent technology to detect and analyze driver’s

attitude and bus driving condition, alongside a sound alert system.

For bus facilities, all franchised buses are equipped with seat belts on exposed seats while new

buses will have all passenger seats installed with 3-point seat belts, providing extra protection for

seated passengers. The Companies also broadcast safety messages through the Automatic Bus Stop

Announcement System on buses, reminding passengers of safety on bus. (For staff safety, please

refer to the section under “Occupational Safety and Health”)

In addition to setting up code of profession and guidelines for employees to strictly comply with,

comprehensive induction and on-the-job trainings are provided for bus captains, including

classroom training, on-the-wheel road training as well as bus model training, ensuring that their

driving skills, safety awareness and route familiarity could meet the Companies’ requirement as

well as the “Practice Note on Training Framework for Franchised Bus Captains” issued by the

Transport Department. Besides, the Companies have Initiated “Buddy Bus Captain” and “Back to

School” schemes to provide tips and reminders for new bus captains on emergency handling skills,

speeding up familiarization.

3. Care for Staff

Our belief: “To have happy customers, we should firstly have happy staff.” NWFB and Citybus

engage various Human Resources ("HR") practices to promote personal and professional employee

development. We respect our employees' right to fair labour practice and a safe, harassment-free

work environment.

Privacy of employees

NWFB and Citybus believe the dignity and individuality of each employee shall be respected and

the privacy and confidentiality of employee records shall be safeguarded. We protect the privacy of

employees at all times and their personal problems or records are treated with utmost

confidentiality.

Equal opportunity

NWFB and Citybus support equal opportunities for all their employees in recruitment, promotion,

job transfer, training, etc. NWFB and Citybus uphold anti-discrimination practices while all

employees are assessed by their ability and suitability to meet the job requirements instead of any

other individual status.

“Anti-discrimination Committee” is set up to formulate and implement “Equal Opportunities Policy”

to ensure compliance with the Sex Discrimination Ordinance, the Disability Discrimination

Ordinance, the Family Status Discrimination Ordinance, and the Race Discrimination Ordinance;

“Sexual Harassment Prevention and Handling Policy” is also established to ensure that complaints

will be handled seriously and prudently with fairness, impartiality and confidentiality.

Employee morale

* The Companies provide staff with some generous welfare and benefits that are rarely available

in other private local enterprises.

* Organize Outstanding Employee Award nomination annually to encourage best practice among

staff.

* Offer professional counseling service to any staff members requiring guidance in their personal

endeavours.

Family-friendly measures

We care for employee’s personal and family needs. In addition to providing medical and insurance

protections which are higher than that of required by law, the Companies also provide travel

allowances to eligible staff’s family members and have set up mechanism and policy for employees

to deal with emergent family affairs. Family-friendly employment policy is established to provide

support for employees in need. In addition to providing statutory paternity leave to eligible staff,

pregnant employees can apply paid leave for prenatal check-up while special job arrangement will

be provided for pregnant bus captains. Besides, lactation room is in place to facilitate breastfeeding

for office staff. The Companies organize health talk and recreation activities for employees and

their families regularly, promoting work-life balance.

Open communication and consultation

NWFB and Citybus are committed to pursuing open communication and consultation in order to

foster mutual trust and respect between the management and staff. The well-established consultative

mechanism includes regular meetings with JCC representatives and unions respectively.

Employee development

NWFB and Citybus attach great importance to the sustainable development of their staff and offer

various industry endorsed programmes, such as “Inspector Graduate Trainee Programme”,

“Engineer Graduate Trainee Programme” and “Apprentice Training Programme”, providing fresh

graduates with comprehensive, systematic and professional trainings as well as a clear career path

to nurture elites for bus industry. The Companies organize courses of multiple disciplines regularly

to enhance employees’ work skills, such as induction and on-the-job trainings for bus captains to

promote good service attitude and safety driving. A new employee training policy (credit-based) has

been introduced; diversified courses are offered to office staff to promote continuous learning.

Besides, “Occupational Safety and Health Quiz” is organized annually for engineering staff to

refresh their knowledge on work safety and efficiency.

Community involvement

NWFB and Citybus are committed to fostering and cultivating relationship with the community and

are sensitive to the community's culture and needs.

We encourage employees and their families to join the volunteer team, and have established the

“Volunteer Alliance Steering Committee” to organize a wide range of volunteer activities, which

have benefited the seniors, teenagers, people with mental disabilities, ethnic minorities and

grass-roots families over the years. With Hong Kong’s ageing population, our community services

mainly target at the elderly in recent years. We co-organized the “Fruitful Tour for Senior Citizens

Volunteer Scheme” with Wan Chai Methodist Centre for the Seniors for five consecutive years since

2013, and launched an IT ambassador team at the end of 2018 to share tips of using NWFB &

Citybus Mobile App with seniors, encouraging them to get exposure to new technology and

facilitating their mobility. In 2019, we introduced a volunteer programme with the theme “bus

safety” to promote bus safety tips to our service targets.

We are also keen to sponsor activities of charitable organizations and government departments,

including participating in fund-raising activities, providing cash donation and free or discounted

shuttle bus services, and sponsoring free media space on bus shelters and bus bodies. We support

road safety events organized by the Transport Department, police and/or District Councils through

sponsoring bus displays, open-top bus and distributing leaflets, etc.

In addition, we have been offering free rides to the disabled and seniors on International Day of

Persons with Disabilities and Senior Citizen's Day respectively. We also organize depot visits for

community centres and academic institutions to enhance public understanding of bus safety and

public transport operations.

4. Occupational Safety and Health

NWFB and Citybus are committed to providing a safe working and travelling environment for our

staff, contractors and passengers. We have set out and strictly enforced our stringent Health and

Safety Policy.

Stringent safety requirements and trainings

NWFB and Citybus enforce stringent safety requirements to meet our very high standards. We offer

our staff a wide range of training programmes, and explain in-house safety rules to our contractors

to raise safety awareness. Besides, NWFB and Citybus undertake ongoing programmes to raise

safety awareness amongst our passengers. In particular, greater emphasis has been placed on

promoting road safety messages to other road users along with in-bus safety messages to passengers.

Between July 2018 and June 2019, our staff received over 6,000 hours of training regarding

occupational safety and health. All frontline management of depots have attended Courses for

Certificate of Safety and Health Supervisors at the Companies’ expense.

Besides, NWFB and Citybus have fully implemented the “Practice Note on Training Framework for

Franchised Bus Captains” issued by the Transport Department. Comprehensive training courses are

provided for all new and existing bus captains to cultivate a safe driving mind-set. Courses include

defensive driving skill, quality customer service, traffic rules knowledge and accident analysis,

practical and bus type training, emotion management and emergency handling skill. Moreover, we

have initiated “Buddy Bus Captain” and “Back to School” schemes to provide new bus captains

with tips and reminders on emergency handling skills, speeding up familiarization. We have an

effective mechanism to monitor our bus captains’ driving performance. To ensure bus captains’

proper driving skills, we have strengthened the usage of GPS Tachograph and extended the speed

monitoring scope to cover all road sections operated by the Companies’ bus routes, alongside a

speed limit sound alert system. (For more details of passenger safety, please refer to the paragraph

of “Quality Bus Services”)

Operations Safety and Administration Department

To reinforce bus operations safety, the Companies have established Operations Safety and

Administration Department which is directly supervised by the Head of Operations and Safety. The

department has set up a series of effective policies and measures in bus facilities as well as bus

captain driving performance.

Engineering Administration and Safety Department

NWFB and Citybus have set up the Engineering Administration and Safety Department to stipulate

safety rules and work procedures, undertake spot checks and regular inspections inside the depots

and office areas. The Companies maintain and constantly review the condition of facilities,

equipment and buses to ensure safety and efficiency of bus services.

Safety Committee

We have also established the “Safety Committee” to review and oversee safety measures, including

bus operations, maintenance of buses, staff training and recruitment.

Caring for staff health

To ensure our bus captains are physically fit to provide passenger service, the Companies provide

pre-employment health checks for all new bus captains, while medical checks are arranged annually

for bus captains aged 50 or above. Besides, all NWFB and Citybus full-time staff are entitled to

medical benefits provided by the Companies.

The Companies have fully adopted the revised “Guidelines on Bus Captain Working Hours, Rest

Times and Meal Breaks” guideline by the Transport Department, and continued to improve the

resting facilities for frontline staff, so as to allow sufficient rest time and safeguard safety. We also

prohibit the use of illegal drugs and alcohol at the Companies' premises. Alcoholism and drug

dependence that affect work performance shall not be tolerated.

In addition, the Companies organize leisure activities and interest classes for staff to encourage

them exercise more, keep and improve health and well-being. The Companies also take care of

mental health of staff with provision of professional employee counselling service and hotline.

5. Environmental Protection

Upholding the principle of sustainable development, NWFB and Citybus comply with all

environmental protection laws and regulations in Hong Kong and have set out an environmental

protection policy. We strive to incorporate green measures into our daily administration and

operations as far as practicable.

Advocacy of sustainability

NWFB and Citybus set out and implement green policies and measures by the “Sustainability

Committee” through regular meetings and task force.

Introducing green buses

As of February 2020, over 97% of the NWFB and Citybus fleet are of Euro 5 or above emission

standard, and there are more than 180 Euro 6 buses. The entire fleet of NWFB and Citybus has long

adopted Euro 5 Diesel, to ensure the lowest emissions. Regular checks on the carbon dioxide

(“CO2”) level of bus compartment are conducted to ensure good air quality on board. In 2019,

100% of buses checked had reached the “First Class of Good Air Quality” stipulated in the

“Practice Note for Managing Air Quality in Air-conditioned Public Transport Facilities – Bus”

published by the Environmental Protection Department. All NWFB and Citybus buses receive

emission tests regularly. We have set a very stringent emission standard for our fleet, which is much

more demanding than the emission standard set by the Environmental Protection Department and

the Transport Department (current official upper limit is 50 Hartridge Smoke Unit i.e. HSU).

Moreover, NWFB and Citybus had completed trial of electric single deck buses. With the

experience gained from the trial of electric single deck buses, we will seek the Government’s

support to carry out trial of electric double deck buses.

Realizing sustainable development concepts in bus depots

NWFB Chong Fu Road depot and Citybus Chai Wan depot have undertaken a full Environmental

Impact Assessment, on top of a well-developed Environmental Management Plan and

Environmental Management Systems, which conform to stringent international standards. NWFB

and Citybus are committed to protecting the environment and minimizing the use of energy, natural

resources and harmful emission. Effective measures include: retrofitting sprinklers for cooling

effect and frequency conversion device into central air-conditioning system, reconditioning

compressors and switching to more energy efficient lubricant to lower power consumption;

replacing Halogen spotlight with energy efficient LED spotlight, and installing motion sensor

controlled LED fluorescent tubes in office and bus depots; carrying out stringent disposal of

chemical waste, separating and storing chemicals, categorizing chemical wastes include waste

lubricating oil, waste oil filters, fluorescent tubes, waste battery and degreaser; implementing

recycling schemes for disposed fluorescent tubes, used water in bus washing, waste oil and used

paper.

To further reduce carbon footprint, NWFB and Citybus have widely adopted renewable energy at

bus depots. In 2019, the Companies joined “Feed-in Tariff Scheme” and installed over 200 solar

panels at Chong Fu Road depot and Chai Wan depot. Also, the lightings of some carriageways,

parking sites and traffic signal display boards in depots are powered by solar energy and wind

power. We are gradually installing rainwater harvesting system at various depots to collect

rainwater for bus washing and floor cleaning at depots in order to save water. Besides, we also use

solar energy to provide lighting at bus stops and staff resting facilities.

Moreover, the Companies converted the rooftop of Chai Wan depot into an organic garden. We

modified seat mountings of retired buses and bus detergent containers to make planting containers,

and made use of wind power and solar energy to generate electricity for the automatic irrigation

system. Food waste from staff canteen is regularly collected to be converted into organic fertilizers.

Green education and training

Upholding green concept in our management and operations, we train our bus captains with the

“Safe, Comfort and Eco-friendly” driving skills. Bus captains are required to turn off engines when

stopping at bus termini. They are encouraged to reduce usage of in-bus lighting system when

daylight is rich, and are instructed to increase speed gradually and brake smoothly when driving to

reduce emissions and noise.

Sharing environmental protection concepts with suppliers and contractors

NWFB and Citybus use environmentally friendly goods or components where possible. We have

specified Forest Stewardship Council (“FSC”) or equivalent certification for procurement of new

buses. Starting from December 2013, we have partnered with a spare part supplier to switch to

reusable plastic pallets for goods delivery which saves up to 120 pieces (10%) of wooden pallet

consumption, i.e. around 2,400kg, each year. Besides, our staff canteen is encouraged to reduce

distributing of disposable tableware.

Promoting environmental protection

NWFB and Citybus spare no effort to promote environmental protection by sponsoring green

groups in various forms. We also raise public awareness on green concepts through staff events,

voluntary activities and depot visits. In recent years, we have donated retired bus facilities to

schools to set up “NWFB and Citybus Classroom” in bus theme for learning.