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Food Safety and Quality

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Food safety is our top priority at Yum China. We have made a substantial investment to build an industry-leading, intelligent, digitalized food safety and quality management system. Utilizing Artificial Intelligence (AI), Internet of Things (IoT), and real-time data collection and analysis, we have established rigorous control measures across the value chain.

Joey Wat Chief Executive Officer
Yum China Holdings, Inc.
Goals
  • Food safety and quality audit covers 100% of restaurants and logistics centers
  • Food safety and quality training covers 100% of employees in offices, restaurants, and logistics centers
  • Food safety assessment covers 100% of food and food contact packaging suppliers
Yum China Food Safety Commitments

Food safety is
our top priority.

We are dedicated to building an advanced food safety system and strive to provide customers with safe food.

We believe in shouldering additional social responsibilities and setting an example in the industry.

Food Safety Governance

To ensure the development and effective implementation of food safety management processes and standards, Yum China has established a holistic, top-down food safety management mechanism that spans from the Board of Directors/Food Safety and Sustainability Committee to functional management teams. This governance system provides comprehensive oversight and effective execution of various management systems, measures, and standards to ensure food safety and compliance.

Board of Directors / Food Safety
and Sustainability Committee
  • The Board of Directors oversees the Company's risk management framework
  • Food Safety and Sustainability Committee under the Board of Directors:
  • Established in 2017 and is currently comprised of three directors assisting the Board of Directors to oversee the Company's food safety and sustainability-related practices, programs, processes, and initiatives
Yum China
Management Team
  • Compliance Oversight Committee:
  • The committee is comprised of leaders from various functions, such as Legal, Internal Audit, Supply Chain Management, Public Affairs, Information Technology, Finance, and Human Resources
  • The committee meets regularly to assess risks, monitor internal controls, and determine strategy and approach to promote compliance
Supply Chain
Management Team
  • Supply Chain Risk Assessment Meetings:
  • Food Safety, Quality, and Nutrition Regulation (FSQNR) Team, Procurement Management, and when necessary, involve other functions
  • Assess risk in areas such as suppliers, logistics centers, and restaurants and formulate preventive measures
FSQNR Team
  • Conduct food safety audits on suppliers, logistics centers, and restaurants
Brand Restaurant
Operations Teams
  • Restaurant manager on-duty inspections
  • District manager patrol inspections
Yum! Brands /
Yum China Audit Teams
  • Food safety/quality audit
Yum China Food Safety Advisory Committee

External experts from various fields are invited to share best practices to drive continuous improvement of
Yum China's food safety management processes

Yum China has built an industry-leading supply chain management team that includes FSQNR, Engineering, Procurement Management, Logistics, and Supply Chain System teams.
Food Safety Culture

We believe every Yum China employee has the responsibility to understand and embrace the Company's food safety values.

For office and restaurant employees, we require every new employee to learn and sign the Yum China Code of Conduct Confirmation Letter or Employee Manual Confirmation Letter. We provide all our employees with access to online food safety courses that enable them to understand food safety laws, regulations, and Yum China's standards. We mandate that restaurant employees receive rigorous job training to ensure they understand and implement the Company's food safety standards with the utmost care.

In addition, we require and guide our franchisees to establish a food safety culture. All franchisees must sign the Franchise Policy Manual, which binds them to adhere to Yum China's Operations Manual, Code of Conduct, and safety and hygiene standards. Furthermore, they must undergo annual food safety training to reinforce their knowledge of national food safety laws and regulations, Yum China's food safety policies, and industry trending topics

Food Safety and Quality Management
Upstream Suppliers
Suppliers
Logistics
Restaurants
and Delivery

Yum China mandates that suppliers establish procedures for approving and monitoring upstream suppliers to effectively identify and manage potential food safety risks associated with their raw materials.

As poultry is a significant ingredient in our food, we focus on managing the source and invest considerable resources in establishing a comprehensive control system for the broiler industry, spanning from breeding to slaughtering and to meat processing. We have implemented an electronic farm information system to register and monitor the usage of veterinary drugs on Yum China-approved poultry farms. Using this system, we conduct unannounced farm inspections and raw material food safety monitoring tests to assess upstream suppliers' performance and reinforce traceability.

Furthermore, we collaborate with our suppliers, promoting the implementation of Yum China GAP, requiring farmers and producers to take scientific, prudent, and responsible approaches. Our partners are required to implement systematic control measures from farm selection, soil and water safety, pesticide management, and fertilizer application, to the implementation of good manufacturing practices, thereby effectively preventing the occurrence of food safety issues.

Our Yum China GAP has achieved 100% coverage in lettuce, tomato and pepper*, oranges, lemons, apples, and broccoli bases. In 2023, we started to cover sweet corn, and continued to expand to other category bases.

*Tomato and pepper bases produce mainly tomatoes, cherry tomatoes, green peppers, cayenne peppers, and cucumbers.

Supplier Approval
Yum China adopts rigorous approval processes for new suppliers, including risk assessments, qualification and compliance checks, and factory approval audits.

Supplier Management
Standards: By drawing on the certification standards of the Global Food Safety Initiative (GFSI), we updated Yum China's Supplier Tracking Assessment and Recognition (STAR) audit standard. Suppliers are also encouraged to obtain food safety and quality management system certification.
Training: We held annual STAR training for all food suppliers to keep them up to date about Yum China's latest requirements.
Audits: We carry out STAR audits to verify whether the suppliers' food safety and quality management systems meet our requirements.
Sampling Tests: Yum China develops an annual raw material food safety sampling plan and conducts random tests to ensure compliance with relevant standards.
Performance Evaluation: Yum China has established a comprehensive supplier performance evaluation system that assesses food safety and quality performance quarterly. Based on the evaluation results, we graded the suppliers, formulate targeted improvement measures, and promote supplier optimization and improvement.
In 2023, Yum China has organized 2 STAR online training sessions, conducted 250+ supplier food safety audits, completed 250+ unannounced supplier quality audits, 400+ key raw materials were covered in food safety sampling tests, and more than 170 suppliers were involved.

Yum China operates a tailor-made, world-class logistics management system to secure food safety and provide efficient and reliable logistics services for our restaurants. Each of our logistics centers is equipped with a dedicated quality assurance specialist to inspect warehousing, receiving, distribution, and unloading. We also conduct regular audits and routine inspections on our logistics service providers (including warehouse, transportation, and unloading of goods) to verify that their food safety and quality management systems meet our requirements.

Furthermore, we utilize the latest technologies to monitor the food safety of cold chain logistics and warehousing processes. We have implemented a smart IoT platform to monitor the movement of food ingredients from suppliers to logistics centers and then to restaurants. This platform also tracks the real-time temperature of vehicles, cold storages, and refrigerated warehouses, as well as the products' temperature from logistics centers to the restaurants, enabling us to promptly identify potential food safety risks. We continue to invest in the supply chain infrastructure to widen our strategic moat and strengthen business flexibility and resilience. This allows us to maintain high synergy and sustainability in special circumstances, reducing the adverse effects of supply disruptions such as the COVID-19 pandemic. Through cooperation with suppliers, as well as a vast logistics network, we can continuously supply all food products without significant interruption.

In 2023, 200+ food safety and quality audits were conducted with warehousing and transportation service providers, more than 1,000+ routine inspections were conducted.

Audits and Inspections: FSQNR Team conducts regular unannounced Operational Excellence Compliance (OEC) Audits on all restaurants, covering food safety, product quality, and customer service. We also conduct regular quality assessments of key menu products and microbiological sampling and testing of food utensils, tableware, water, ice, and related products to help ensure compliance.

Restaurant Operations Management: Yum China has established industry-leading restaurant operating standards and procedures covering raw material receiving, storage, thawing and cooking, shelf-life management, personal hygiene, and utensil and equipment cleaning and disinfection. These help ensure that all our restaurants implement consistent food safety standards and provide food with consistent quality and taste. We conduct annual risk assessments at our restaurants to identify potential food safety and quality risks and take effective measures to mitigate risks and eliminate hazards. We also conduct risk assessments for new products, new restaurant layouts, equipment, and store operations to help ensure compliance with food safety and quality requirements.

Delivery Management: We have set up our dedicated delivery service teams for KFC and Pizza Hut. We require all third-party delivery partners to sign and strictly adhere to a letter of commitment on the food safety and quality practices for food delivery. The letter outlines specific requirements for regulatory compliance, staff management, catering, delivery facilities, equipment as well as rigorous management of third-party platforms.

In 2023, 22,000+ OEC audits were performed at our restaurants across the country.

Trending Issues
Leverage Technology to Ensure Food Safety

We have made significant investment towards building an industry leading intelligent and digitalized supply chain. The use of cutting-edge technologies has allowed us to combine traditional control measures such as sampling audit, post audit rectification, performance assessments with technology enable real-time data collection and analysis, key processes visibility and deviation rectification to improve efficiencies and timeliness of Yum China's food safety management.
We harness the latest technology to continually enhance our ability to prevent and control food safety risks. Our Food Safety and Quality Management Platform (eQA), connects supplier factory data with Yum China's internal systems through the Quality Data Platform (iQA) system, ensuring real-time food quality data monitoring. Furthermore, our Cold Chain IoT system allows live-monitoring of storage temperatures. We also analyze internal and external food safety big data through our Food Safety Risk Assessment and Early Warning System (iFS), enabling us to proactively assess and take action to mitigate potential risks. In 2023, we began exploring the use of AI-generated content (AIGC) to enhance our multidimensional food safety monitoring and risk assurance.

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