In ND Paper, quality is our priority. From raw materials, production process, packaging to transportation, we always do our best to deliver quality products and services to our customers. We use premium raw materials, advanced machineries and matured skills and technology. Enhanced with a rigorous management system, we can always assure the quality of our products. In addition, we hire experts from overseas to improve our production process so that we can enhance our quality continuously.

The Group considers that the implementation of environmental protection practices and maintaining high environmental standards are valuable assets and competitive strengths of the ND Paper. The Group obtained ISO14001 certification for its environmental management standards. As part of its commitment to environmental protection, the Group has invested in environmental facilities which include the water recycling and conservation system that significantly reduces its water consumption at each of its production lines, the circulating fluidized bed incinerators which minimized waste products, and the coal-fired cogeneration power plants that are equipped with particulate filtration and wet desulphurization equipment to allow their emission levels well below the permitted emission levels under applicable PRC regulatory requirements. These measures significantly reduce the impact of its operations on the environment and the risk of exposure to liabilities under environmental protection laws and regulations.

Based on its production know-how and technologies, the Group also further increased the percentage of fiber derived from the recovered paper in the Group's products by installing new paper machines: PM12 and PM13, to manufacture linerboard which adopted the use of recovered paper only as raw materials for its default mode.

In December 2006, Guangdong Environmental Protection Bureau conducted an environmental credit rating on Dongguan Nine Dragons and Dongguan Sea Dragon, both being members of the Group, and granted the Group with the honour of Green/Environmental Creditable Enterprise, which is the solid evidence of the Group's record of compliance with environmental protection.

The Group has over 800 maintenance personnel who have undergone trainings provided by the original equipment vendors and are responsible for periodic repair and maintenance of paper machines. The paper machines are regularly inspected and maintained by the Group's maintenance teams to ensure that they are in proper working condition. In addition, the Group also upgrades its production equipment concurrently with its repair and maintenance to increase the life span and efficiency of its production equipments.

Enterprise resources planning (ERP) system is gradually implementing in the Dongguan and Taicang operations. The system will manage, control and track all aspects of operations, including inventory control, operation and maintenance of the paper machines, quality control of its products, sales and marketing and delivery of its products through its internal transportation and delivery network. The ERP system is expected to be fully implemented by end of 2007, which will lay a sound foundation for further overall control on costs and make a significant improvement in the timing and accuracy of information transmission.