Xinjiang Daqo New Energy Co.Ltd(688303)
Report on the work of independent directors in 2021
As an independent director of Xinjiang Daqo New Energy Co.Ltd(688303) (hereinafter referred to as “the company”), in strict accordance with the company law of the people’s Republic of China (hereinafter referred to as “the company law”), the securities law of the people’s Republic of China, the governance standards of listed companies, the rules for independent directors of listed companies, the Listing Rules of science and Innovation Board of Shanghai Stock Exchange and other relevant laws and regulations In accordance with the provisions of normative documents and the requirements of the Xinjiang Daqo New Energy Co.Ltd(688303) articles of Association (hereinafter referred to as the articles of association), the rules of procedure of Xinjiang Daqo New Energy Co.Ltd(688303) independent directors and the working system of Xinjiang Daqo New Energy Co.Ltd(688303) independent directors’ annual report, in our work in 2021, we performed our duties honestly, diligently and conscientiously, and actively participated in the meetings of the general meeting of shareholders, the board of directors and all special committees of the board of directors, And ensure the independence of performing duties, and earnestly safeguard the interests of the company and all shareholders, especially the legitimate rights and interests of minority shareholders. The performance of duties in 2021 is reported as follows:
1、 Basic information of independent directors
The board of directors of the company is composed of 9 directors, including 3 independent directors, accounting for more than one-third of the board of directors, which is in line with the provisions of relevant laws and regulations and the company’s system.
(I) personal work experience, professional background and part-time work
1. Liansheng Cao (Mr. Cao Liansheng), born in 1950, American nationality
Master of physical chemistry of Graduate School of Chinese Academy of Sciences (now University of Chinese Academy of Sciences) and master of computer science of Michigan State University. From August 1987 to January 1989, he served as software development engineer of Hayakawa Institute of technology; From January 1989 to February 1992, he served as senior software engineer and it department manager of viam manufacturing, Inc; From February 1992 to December 1996, he served as senior system analyst of Andersen Consulting; From January 1997 to September 2000, he served as senior software architect and senior manager of pers è software, Inc; From October 2000 to February 2002, he served as senior software architect and director of Lightspeed, Inc; From July 1996 to August 2004, he served as the executive president (CEO) of C & A enterprises Corp; From March 2002 to August 2004, he served as deputy director of Los Angeles Office of Shanghai Foreign Investment Promotion Center; From August 2004 to June 2010, he served as the special adviser to the executive director and executive director of career development of Zhongwei semiconductor equipment (Shanghai) Co., Ltd; From June 2010 to April 2011, he served as special adviser to the executive director of ideal energy equipment (Shanghai) Co., Ltd., executive director of strategy and affairs management department and member of the Executive Committee; From 2011 to now, he has served as the general manager and vice president of Zhongwei semiconductor equipment (Shanghai) Co., Ltd. in China; Independent director of the company since June 2020.
2. Mr. Yao Yi, born in 1972, Chinese nationality, without permanent residency abroad
Master of international law, Renmin University of China, and has the qualification of securities and economist (Finance). From July 1995 to December 1995, he served as a lawyer assistant of Fujian economic and trade law firm; From January 1996 to August 1997, he served as a lawyer assistant and lawyer of Fujian Junli law firm; From July 2000 to December 2000, he worked as an employee of the corporate finance department of Shanghai Pudong Development Bank Co.Ltd(600000) Shanghai regional headquarters; From December 2000 to May 2002, he served as the legal director of Haitong Securities Company Limited(600837) general manager’s office; From May 2002 to January 2005, he served as the general manager of the Legal Affairs Department of Jianqiao Securities Co., Ltd; From February 2005 to November 2007, he served as a lawyer and partner of Shanghai Yingming law firm; From December 2007 to now, he has been a lawyer and partner of Guohao law firm (Shanghai); He has been an independent director of the company since June 2020.
3. Mr. Yuan Yuan, born in 1983, is a Chinese national and has no right of permanent residence abroad
Doctor of accounting, Shanghai University of Finance and economics, postdoctoral in finance, Tsinghua University. From May 2012 to March 2016, worked in the listing Department of China Securities Regulatory Commission and the Fund Industry Association; From March 2016 to July 2017, he served as deputy director and chief strategic analyst of Soochow Securities Co.Ltd(601555) Research Institute; From July 2017 to may 2020, he served as deputy director, managing director and general manager of equity Department of Huafu securities investment banking business committee of Industrial Bank Co.Ltd(601166) group; From May 2020 to now, he has served as the managing director and department head of Sino German securities investment banking department; He has been an independent director of the company since June 2020.
(II) independence description
As an independent director of the company, we, our immediate family members and major social relations do not work in the company or its subsidiaries, and do not work in the company’s affiliated enterprises; No financial, legal, consulting and other services are provided for the company or its subsidiaries. We have the independence and qualifications required by the rules for independent directors of listed companies, the articles of association, the rules of procedure for independent directors and the annual report working system for independent directors of the company issued by the CSRC, and can ensure objective and independent professional judgment without affecting our independence.
2、 Summary of annual performance of independent directors
(I) attendance at the board of directors and general meeting of shareholders of the company this year
In 2021, the company held 8 board meetings and 4 general meetings of shareholders. The attendance of independent directors is as follows:
Participation in the board of directors and the general meeting of shareholders
Name this year should be entrusted in person to attend the absence times. Whether there are two consecutive attendance times? Number of directors’ seats? Number of times not attended in person for several times
Number of meetings plus meetings
Liansheng Cao 8 times 8 times 0 times 0 times no 4 times
Yao Yi 8 times 8 times 0 times 0 times no 4 times
Yuan Yuan 8 times 8 times 0 times 0 times no 4 times
As an independent director, we earnestly perform the duties of an independent director by attending the board of directors and the general meeting of shareholders in a diligent and conscientious manner. On this basis, we exercise our voting rights independently, objectively and prudently, vote in favour of all proposals considered by the board of directors, and express independent opinions with explicit consent on important matters requiring the opinions of independent directors.
During the reporting period, the company performed relevant procedures for major business decisions and other major matters. In 2021, the convening and holding of the board of directors and general meeting of shareholders of the company comply with legal procedures, and the voting results and resolutions made at the meeting are legal and effective.
(II) convening and attendance of special committees
In 2021, the audit committee held 7 meetings, the strategy committee held 5 meetings, and the nomination committee and the remuneration and assessment committee held 2 meetings respectively. The company has earnestly fulfilled the responsibilities and obligations of independent directors and put forward opinions and suggestions to the board of directors after reaching opinions on the matters under consideration, which has played a positive role in making scientific decisions for the board of directors of the company.
(III) site investigation
In 2021, we actively took advantage of our participation in the board of directors, the general meeting of shareholders and other working hours to conduct field visits to the company, conducted on-site investigations on the company’s operation, management, the construction and implementation of internal control system and the implementation of resolutions of the board of directors, and maintained close contact with other directors and senior executives of the company through telephone, talks and other means, Learn about the company’s situation in time, listen to the management’s reports on the company’s business status, progress of major events, standardized operation, financial management and risk control, pay attention to the impact of external environment and market changes on the company at any time, and offer suggestions for the steady and long-term development of the company.
(IV) the company’s cooperation with independent directors
In order to ensure that the independent directors can effectively exercise their functions and powers, the company provides us with necessary conditions, can communicate with us in time on major matters such as the company’s production and operation, and can timely supplement or explain the supplementary information we require, which provides better assistance for the independent directors to perform their duties.
(I) related party transactions
During the reporting period, the independent directors reviewed the related party transactions of the company and believed that: there are related party transactions between the company and related parties, which are necessary for normal production and operation; On the principle of voluntariness, equality and compensation, the transaction price is based on the fair market price, in line with the principles of openness, fairness and impartiality, fair and free from any damage to the interests of the company, shareholders and non related parties. Related party transactions have fulfilled the relevant decision-making and approval procedures, and have not damaged the legitimate rights and interests of minority shareholders.
(II) external guarantee and fund occupation
During the reporting period, the company had no external guarantee and fund occupation.
(III) use of raised funds
During the reporting period, the 16th meeting of the second board of directors of the company deliberated and approved the proposal on using super raised funds to supplement working capital, the proposal on using some temporarily idle raised funds for cash management, and the proposal on using raised funds to replace self raised funds invested in pre raised projects and paid issuance expenses; The 18th meeting of the second board of directors deliberated and adopted the proposal on using some over raised funds to increase the investment amount of raised investment projects; The 19th meeting of the second board of directors deliberated and approved the proposal on adjusting the implementation location, implementation subject and investment amount of some raised investment projects. As an independent director, we reviewed the above proposal and expressed clear opinions.
During the reporting period, the company, in accordance with relevant laws, regulations and normative documents such as the guidelines for the supervision of listed companies No. 2 – regulatory requirements for the management and use of raised funds by listed companies, the guidelines for the self discipline supervision of companies listed on the science and Innovation Board of Shanghai Stock exchange No. 1 – standardized operation, and the measures for the administration of Xinjiang Daqo New Energy Co.Ltd(688303) raised funds, After verifying the deposit and use of the company’s raised funds in 2021, it is considered that the company has made special account storage and special use of the raised funds, and the actual use of the raised funds is consistent with the relevant contents disclosed in the company’s temporary announcement, periodic report and other information disclosure documents. The company does not deposit and use the raised funds in violation of regulations. (IV) merger and reorganization
During the reporting period, there was no merger and reorganization of the company.
(V) appointment and remuneration of senior managers
During the reporting period, there was no change in the senior management of the company. The 18th meeting of the second board of directors of the company deliberated and approved the proposal on purchasing liability insurance for the company’s directors, supervisors and senior managers. The independent directors carefully reviewed the remuneration of the company’s senior managers in the reporting period and believed that the remuneration scheme of the company’s senior managers in 2021 was scientific and reasonable, The salary payment and review procedures comply with the articles of association and the relevant provisions of the company’s internal management system. (VI) performance forecast and performance express
The company’s shares have been officially listed and traded on the science and Innovation Board of Shanghai Stock Exchange since July 22, 2021. During the reporting period, the company did not disclose the performance forecast and performance express.
(VII) foreign investment
During the reporting period, the 19th meeting of the second board of directors of the company deliberated and approved the proposal on signing Baotou strategic cooperation framework agreement, project investment agreement and letter of intent and the proposal on capital increase of wholly-owned subsidiaries. The independent directors carefully reviewed and expressed their agreed independent opinions.
(VIII) appointment or replacement of accounting firms
During the reporting period, the 14th meeting of the second board of directors of the company deliberated and approved the proposal on employing Deloitte Touche Tohmatsu (special general partnership) as the company’s audit institution in 2021, and appointed Deloitte Touche Tohmatsu (special general partnership) as the company’s financial audit institution in 2021. After verification, the review procedures of the accounting firm employed by the company are legal and effective, and comply with the provisions of the company law, the articles of association and relevant laws and regulations.
(IX) cash dividends and other investor returns
During the reporting period, the company had no cash dividends and other investor returns.
(x) performance of commitments of the company and shareholders
During the reporting period, all commitments of the company and its controlling shareholders were strictly observed, and there was no breach of commitments by the company and its controlling shareholders.
（11） Implementation of information disclosure
The company’s information disclosure is true, accurate and complete without false records, misleading statements or major omissions. It can timely and fairly transmit the important information of the company to all investors in accordance with the Listing Rules of Shanghai Stock Exchange science and innovation board and relevant laws and regulations, and effectively safeguard the interests of all shareholders, especially small and medium-sized shareholders.
（12） Implementation of internal control
During the reporting period, the company actively promoted the construction of the company’s internal control standard system and established a relatively perfect internal control system in strict accordance with the provisions of the company law, the securities law of the people’s Republic of China, the governance standards of listed companies, the Listing Rules of the science and innovation board of Shanghai Stock Exchange and other relevant laws and regulations and the articles of association The standardized operation of the board of directors, the board of supervisors and other institutions and the effectiveness of the internal control system.
（13） Operation of the board of directors and its subordinate special committees
The board of directors of the company has established an audit committee, a remuneration and assessment committee, a nomination committee and a strategy committee. During the reporting period, the special committees actively carried out their work and earnestly performed their duties,
