Lanzhou Lishang Guochao Industrial Group Co.Ltd(600738)
Report on the work of independent directors in 2021
As an independent director of Lanzhou Lishang Guochao Industrial Group Co.Ltd(600738) (hereinafter referred to as “the company”), I performed my duties in good faith and diligently in 2021 in strict accordance with the company law, the securities law, the governance standards of listed companies, the guiding opinions on the establishment of independent director system in listed companies and other relevant laws and regulations, as well as the articles of association, the working system of independent directors and other relevant regulations and requirements, In the daily work and important decision-making of the board of directors, he did his duty, carefully considered various proposals of the board of directors, played the due role of independent directors from the overall interests of the company, and effectively safeguarded the legitimate rights and interests of the company and all shareholders, especially minority shareholders. The work of the company’s independent directors in 2021 is reported as follows: I. Basic information of independent directors
（1） Personal work experience, professional background and employment
Mr. Li Wanjun, Chinese nationality, without overseas permanent residency, has a bachelor’s degree, certified public accountant and asset appraiser. He has successively served as the accountant of Hangzhou Urban Construction Comprehensive Development Company, the project manager of Zhejiang Rui Certified Public Accountants (Zhejiang tax agent firm), the assistant to the general manager of Zhejiang provincial asset appraisal company, the manager of Hangzhou Tonghua certified public accountants, the Department Manager of Hangzhou branch of Beijing Xinghua certified public accountants, the chief accountant of Hangzhou Tonghua certified public accountants, Spearhead Integrated Marketing Communication Group(300071) independent director and the independent director of the company.
（2） Description of independence
As an independent director of the company, I have the independence and qualification required by the rules for independent directors of listed companies, the articles of association and the working system of independent directors, can ensure objective and independent professional judgment, and have not been punished by the CSRC and other relevant departments or the stock exchange; I have not held any other position in the company or the company’s major shareholder unit, and there is no relationship with the company, the company’s major shareholder, the actual controller and the interested units or individuals that may hinder my independent and objective judgment.
2、 Annual performance of independent directors
（1） Attendance at the board of directors and shareholders’ meeting
1. During the reporting period, the company held 13 meetings of the board of directors and 3 meetings of shareholders. I actively participated in the board of directors and the general meeting of shareholders held by the company, strictly reviewed the procedures of the meeting, carefully reviewed the relevant materials of the meeting, actively participated in the discussion of proposals, and played a positive role in the standardized operation and correct and scientific decision-making of the board of directors. My attendance at the meeting in 2021 is as follows:
Attendance times in person absenteeism times whether there are two consecutive times of holding meetings without giving the name of the meeting in person
Counting meetings
Board of directors 13 0 no
General meeting 3 2 1 no
2. During the reporting period, the company held 6 meetings of the audit committee of the board of directors, 2 meetings of the strategy committee, 1 meeting of the nomination committee and 1 meeting of the remuneration and assessment committee. As a member of the audit committee, nomination committee and remuneration and assessment committee, my attendance at the meeting in 2021 is as follows:
Name of meeting number of meetings attended
Audit committee 6
Nomination Committee 1
Salary and assessment committee 1
（2） Site investigation
With the active cooperation of the company, we conducted on-site inspection on the company through the board of directors and shareholders’ meeting, deeply understood the operation and management and financial status of the company, and fully exchanged views with the company on the economic environment, industry development trend, development planning, foreign investment, internal control construction and other conditions faced by the company. Reviewed the adequacy of the convening procedures of the board of directors, necessary documents and materials and information that can make reasonable and accurate judgments. When we exercise our functions and powers, the directors, supervisors, senior managers and relevant staff of the company maintain continuous and smooth communication with us, providing us with necessary working conditions to ensure our efficient work. For the matters decided by the board of directors, the company shall notify in advance according to the legal time and provide sufficient materials at the same time, communicate and discuss by means of on-site and communication, and timely supplement the problems raised by us, so as to facilitate us to make prudent judgment.
3、 Key matters concerned in the annual performance of independent directors
We carefully reviewed the decision-making, implementation and disclosure of the board of directors, communicated with the company’s senior executives, finance department and other relevant personnel on the company’s external guarantee, financial assistance and related party transactions, and conducted on-site investigation to obtain the information required for decision-making. During the decision-making process of the board of directors, we fully communicated with other directors and supervisors, actively used our own knowledge background, and expressed prior and independent professional opinions on relevant matters. The key concerns are as follows:
（1） Related party transactions
In accordance with the relevant requirements of the Listing Rules of Shanghai Stock Exchange, the guidelines for self-discipline supervision of listed companies of Shanghai Stock Exchange and other relevant provisions of the articles of association and the company’s decision-making system for related party transactions, I make a prudent judgment on the necessity, objectivity, pricing fairness and impact on the company and shareholders’ equity of related party transactions in the course of the company’s operation. In this year, the independent opinions on the related party transactions involved in the company’s foreign investment were recognized and agreed in advance.
（2） External guarantee and fund occupation
According to the notice on regulating the external guarantee behavior of listed companies and other relevant provisions of the CSRC, I have carefully checked the external guarantee of the company, and have not found any damage to the rights and interests of the company’s shareholders, especially the minority shareholders. As of December 31, 2021, the total external guarantee of the company and its subsidiaries was 1292243100 yuan, accounting for 70.16% of the latest audited net assets of the company, and the guarantee balance was 262043100 yuan, accounting for 14.23% of the latest audited net assets of the company. The company does not provide guarantee for the controlling shareholders and other related parties of the company, nor does it have any other overdue guarantee.
During the reporting period, the funds of the company and its controlling shareholders and other related parties did not occupy the company’s funds in disguised form through unfair transactions, nor did there be any non operating fund occupation that continued to the reporting period in the previous period.
（3） Use of raised funds
During the reporting period, the company did not use the raised funds.
（4） Nomination and remuneration of directors and senior managers
During the reporting period, the company appointed the Secretary of the board of directors and the chief financial officer. We conducted a comprehensive review of the candidates’ qualifications, educational experience, working background and professional ability, and expressed independent opinions. The company’s selection and employment procedures are standardized, and the appointed senior managers comply with relevant laws and regulations, the articles of association and the relevant provisions of the company’s internal management system.
We reviewed the remuneration of the company’s directors and senior managers during the reporting period and believe that the remuneration scheme of the company’s directors and senior managers in 2021 is scientific and reasonable and in line with the actual development needs of the company. The salary payment and review procedures comply with the articles of association and the relevant provisions of the company’s internal management system.
（5） Performance forecast
During the reporting period, the company timely disclosed the announcement of the pre reduction of annual performance in 2020 in accordance with the stock listing rules of Shanghai Stock Exchange and other relevant provisions.
（6） Appointment of accounting firms
During the reporting period, the company continued to employ Tianjian Certified Public Accountants (special general partnership) as the audit institution of the company’s 2021 financial report and internal control audit institution. After examination, Tianjian Certified Public Accountants (special general partnership) has the audit qualification of securities and futures related businesses and the experience and ability to provide audit services for listed companies; In the process of 2020 financial report and internal control audit, we adhered to the principle of independent audit, completed the audit work diligently and efficiently, and the audit report issued can objectively and fairly reflect the company’s financial status and operating results. This renewal is conducive to ensuring the continuity and quality of audit work. The company’s re employment of audit institutions and the procedures for payment of remuneration comply with the provisions of relevant laws and regulations. The level of remuneration paid is fair and reasonable, and there is no damage to the interests of the company and all shareholders.
（7） Cash dividends and other investor returns
During the reporting period, the company implemented the profit distribution plan for 2020 and decided not to distribute profits or convert capital reserve into share capital in 2020. The company’s profit distribution plan for 2020 comprehensively considers the company’s industry characteristics, development stage, its own business model, profitability and future development fund demand, which is in line with the actual situation of the company. The deliberation and voting procedures of the profit distribution plan comply with the relevant provisions of the company law and the articles of association. There is no abuse of shareholders’ rights to improperly intervene in the company’s decision-making, or damage to the interests of the company and minority shareholders.
（8） Performance of commitments of the company and shareholders
Violation of the commitments of the shareholders and the controllers of the company and the actual situation during the reporting period.
（9） Implementation of information disclosure
During the reporting period, the company performed the obligation of information disclosure in strict accordance with the regulations, ensured the timeliness and fairness of information disclosure, and effectively safeguarded the legitimate rights and interests of the company’s shareholders.
（10） Implementation of internal control
During the reporting period, the company continued to standardize and improve its internal control system. I checked the internal control of the company and believed that the company could comply with the requirements of relevant national laws, regulations and departmental rules and the basic norms of internal control, standardize its operation according to its actual situation, promote the implementation of internal systems, and strive to improve the operation and management level and risk prevention ability of the company. At present, no major defects in the design or implementation of internal control have been found.
（11） Operation of the board of directors and its subordinate special committees
During the reporting period, the board of directors of the company convened the meeting of the board of directors in strict accordance with the requirements of laws, regulations and normative documents such as the company law, the articles of association and the rules of procedure of the board of directors. The directors of the company attended the meeting on time, performed their duties and obligations diligently, carefully reviewed various proposals and made corresponding decisions scientifically and reasonably, which provided a guarantee for the sustainable development of the company’s operation. The strategy committee, audit committee, nomination committee and remuneration and assessment committee under the board of directors of the company perform their respective duties, work in strict accordance with the implementation rules of each special committee, give full play to their professional functions, make professional judgments on relevant bills, and make positive contributions to the decision-making of major matters, corporate governance and standardized operation of the company.
4、 Overall evaluation and recommendations
In 2021, as an independent director of the company, I earnestly, diligently and prudently exercised the rights of independent directors conferred by the articles of association, truly performed various duties of independent directors, actively participated in the decision-making of major matters of the company, and gave full play to the supervisory role of independent directors.
In 2022, I will continue to strengthen communication with the directors, supervisors and management of the company. In the spirit of good faith and diligence and the principle of being responsible for the company and all shareholders, I will perform the duties of independent directors independently, objectively, faithfully, honestly, diligently and dutifully in strict accordance with national laws and regulations and the rights conferred by the company, actively promote and continuously improve the governance level of the company, and provide suggestions for the sustainable and healthy development of the company, Earnestly safeguard the overall interests of the company and the legitimate rights and interests of all shareholders, especially minority shareholders.
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(there is no text on this page, which is the signature page of the 2021 annual report of Lanzhou Lishang Guochao Industrial Group Co.Ltd(600738) independent directors) signature of independent directors:
Li Wanjun, Jiang Qingyun, Liu Jiapeng
April 2, 2022
