Vanfund Urban Investment&Development Co.Ltd(000638)
Management system of subsidiaries
Chapter I General Provisions
Article 1 in order to further regulate the organizational behavior of Vanfund Urban Investment&Development Co.Ltd(000638) (hereinafter referred to as the “company”) and its holding subsidiaries (hereinafter referred to as the “subsidiaries”) and branches, protect the legitimate rights and interests of the company and all investors, and ensure the standardized, orderly and healthy development of all branches and subsidiaries, this system is formulated in accordance with the relevant provisions of the company law and the articles of association.
Article 2 this system is applicable to subsidiaries and branches of the company. If a subsidiary simultaneously controls other companies, it shall establish a management system for its subsidiaries with reference to the requirements of this system and accept the supervision of the company.
Article 3 the term “subsidiary” as mentioned in this system refers to the independent legal person (or other organization) established by the company according to law, including:
(I) wholly owned subsidiaries (or other organizations) established solely by the company;
(II) a company (or other organization) jointly invested and established by the company and other legal persons (or other organizations) or natural persons, and the company holds more than 50% of its shares;
(III) an enterprise jointly invested and established by the company and other legal persons (or other organizations) or natural persons, and the company holds no more than 50% of its shares, but can decide on the composition of its executive director or more than half of the members of the board of directors;
(IV) the company is jointly invested and established with other legal persons (or other organizations) or natural persons, and the company holds no more than 50% of its shares, but has more than 50% of the voting rights in its authority, or can actually control the enterprise through agreement or other arrangements.
The term “branch” as mentioned in this system refers to the branch invested and registered by the company or subsidiary.
Article 4 as a shareholder of a subsidiary, the company enjoys the right to return on the assets of the subsidiary, the right to make decisions on major matters, the right to choose senior managers (including directors, supervisors and managers) and the right to supervise financial audit according to the amount of capital invested by the company in the subsidiary.
As a subsidiary of the company, the branch company has comprehensive management power over it.
Article 5 the company implements a combination of centralization and decentralization in the management of branches and subsidiaries. The appointment and removal of senior managers, major investment decisions (including equity investment, debt investment, major fixed asset investment, major project investment, etc.), annual operation budget and assessment will fully exercise the management and voting rights. At the same time, the operators of each branch and subsidiary will be given full autonomy in their daily operation and management to ensure the orderly, standardized and healthy development of each branch and subsidiary.
Article 6 the basic principles of the company’s management of subsidiaries:
(I) principle of strategic unity: the development strategy and planning of subsidiaries must obey the overall development strategy and planning of the company, and their own planning must be refined and improved under the framework of the company’s development planning;
(II) principle of independent legal person: the company guarantees the independent accounting and independent operation status of its subsidiaries. Subsidiaries independently determine the internal management organization and relevant systems;
(III) major examination and approval principle: the company conducts decision-making, examination and approval control on major transactions or matters of subsidiaries that may have a significant impact on the interests of the company or subsidiaries;
(IV) principle of standardized operation: subsidiaries shall operate in accordance with various management regulations of the securities regulatory department on listed companies, abide by the company’s management systems on corporate governance, related party transactions, foreign investment, foreign guarantee, etc., and establish and improve the internal control system according to their own business characteristics and environmental conditions.
Chapter II operation and management
Article 7 the company will implement annual budget management on the operation, financing, investment and expenses of each branch and subsidiary according to the needs of development. The company will verify and issue the annual operation, investment, financing and financial budgets of each branch and subsidiary according to the market and the enterprise’s own situation, and issue the annual budgets to implement on a monthly and quarterly basis. In case of major changes in the external market and the internal business environment of the enterprise during the implementation of the budget, each branch and subsidiary can submit an application for adjustment of the annual budget every half a year, and modify its relevant budget indicators after being reviewed and confirmed by the company. All branches and subsidiaries shall ensure the implementation and completion of various budget indicators.
Article 8 the company will coordinate the business strategy and risk management strategy of its subsidiaries according to its overall strategic plan, and urge its subsidiaries to formulate relevant business plans, risk management procedures and internal control systems. Subsidiaries shall accept the supervision of the company and establish corresponding business plans and risk management procedures in accordance with the company’s business strategy and risk management policy.
Article 9 according to its overall business plan and on the basis of fully considering the business characteristics and operation conditions of its subsidiaries, the company issues business objectives to its subsidiaries, and the operation management of the subsidiaries shall formulate and implement specific implementation plans according to the business objectives issued by the company.
Article 10 major transactions of subsidiaries shall perform the examination and approval procedures and disclosure obligations in accordance with the provisions of the articles of association, foreign investment management system, foreign guarantee management system, related party transaction management system and other internal control systems. After being deliberated and approved by the corresponding authority of the company, the subsidiary shall perform its internal approval procedures.
Article 11 the company shall establish an information management system, and the accounting and management systems of all branches and subsidiaries shall be included in the system management. The information of operation, finance, personnel, assets, investment (financing) and so on must be fed back in accordance with the principles of authenticity, accuracy, timeliness and comprehensiveness, so as to provide a scientific basis for the company’s business decision-making.
Chapter III corporate governance and personnel management
Article 12 a subsidiary shall, in accordance with the provisions of relevant laws and regulations and in combination with its own characteristics, establish and improve the corporate governance structure and internal management system, and operate the corporate assets legally and effectively.
The subsidiary shall set up the board of shareholders (except the wholly-owned subsidiary), the board of directors (or executive director), the board of supervisors (or 1-2 supervisors) and other discussion bodies according to law. The company appoints corresponding directors, supervisors and senior managers to the subsidiaries in accordance with the provisions of the shareholders’ agreement and the articles of association of the subsidiaries it invests in. The term of office shall be implemented in accordance with the provisions of the articles of association of the subsidiaries. The company may adjust the appointed personnel during the term of office as needed.
The directors, supervisors and senior managers appointed as subsidiaries must be responsible to the company, bear corresponding responsibilities, and fully exercise their powers according to the wishes of the company.
Article 13 the managers of subsidiaries (including managers and deputy managers) shall be appointed and dismissed by the board of directors of subsidiaries, and the managers of branches shall be directly appointed and dismissed by the company. The managers of branches and subsidiaries must be highly responsible for the company, and must have the ability to fully exercise their duties and powers, so as to ensure the standardized and orderly operation and management of branches and subsidiaries.
The employed manager of the subsidiary company shall sign an employment contract with the company, and the employed manager of the branch company shall sign an employment contract with the company. The employment contract shall specify the terms of employment period, responsibilities, rights, obligations, benefits and treatment of breach of contract.
Article 14 the directors, supervisors and senior managers of a subsidiary shall strictly abide by the provisions of laws, administrative regulations and the articles of association, and shall have the obligation of loyalty and diligence to the company and its subsidiaries. They shall not use their power to seek personal interests, accept bribes or other illegal income, or occupy the property of their subsidiaries without the consent of the company, It is not allowed to enter into contracts or conduct transactions with its subsidiaries.
If the above-mentioned personnel violate the provisions of this article and cause losses, they shall be liable for compensation; Those suspected of committing a crime shall be investigated for legal responsibility according to law.
Article 15 within the scope of the company’s staffing, the institutional setting and staffing of each branch and subsidiary shall be reported to the company for review and filing.
Article 16 all branches and subsidiaries shall implement the open recruitment system for employees, and formulate the recruitment, dismissal and daily management measures of employees and report them to the company for the record.
Article 17 establish a regular reporting system for the managers of branches and subsidiaries to the general manager’s office meeting of the company. The managers of branches and subsidiaries must make a comprehensive and detailed business report to the general manager’s office meeting of the company every quarter and a work report to the board of directors of the company every year.
Article 18 the remuneration of managers of branches and subsidiaries shall be determined by the company. The remuneration of deputy managers of branches and subsidiaries shall be drafted by the managers of branches and subsidiaries and submitted to the general manager of the company for review and confirmation. The remuneration of department managers and other employees of branches and subsidiaries shall be determined by the managers of branches and subsidiaries. The remuneration of the financial principals of the branches and subsidiaries shall be jointly determined by the financial principals of the company and the managers of relevant branches and subsidiaries.
Chapter IV financial management
Article 19 branches and subsidiaries shall formulate the company’s financial management system in accordance with national laws and regulations and the company’s provisions, which shall be implemented after being reviewed and confirmed by the company, and the modification of the system shall also be implemented in accordance with this procedure.
Article 20 the financial management system formulated by each branch and subsidiary includes (but is not limited to) the following aspects:
1. Foreign investment management system;
2. Management system for purchase, construction, major transformation and decoration of fixed assets and asset disposal;
3. Loan and other forms of financing management system;
4. Budget management system;
5. Cost management system.
Article 21 without the approval of the company, branches and subsidiaries shall not borrow funds from other enterprises and individuals and provide any form of guarantee (including mortgage, pledge, guarantee, etc.).
Article 22 the financial accounting of all branches and subsidiaries must be true, accurate, timely and standardized in accordance with the law, and shall not resort to fraud, falsely list or understate income, falsely amortize, not amortize or understate costs and expenses. Article 23 all branches and subsidiaries must prepare and submit accounting statements on a monthly basis and complete financial reports (including accounting statements and statement descriptions) on a quarterly basis, and submit them to the company on time. The accounting statements and financial reports submitted by branches and subsidiaries to the company must be submitted after being reviewed and confirmed by the financial principals and managers of branches and subsidiaries. The financial directors and managers of branches and subsidiaries shall be responsible for the authenticity of the accounting statements and financial reports submitted by the company.
Chapter V major issues and reports
Article 24 each subsidiary company shall establish a major event reporting system and review procedures, timely report major business matters, major financial matters, resolutions of the board of directors, resolutions of the general meeting of shareholders and other important documents to the person in charge of the company, as well as other information that may have a significant impact on the trading price of the company’s shares and their derivatives, and report major events to the board of directors or the general meeting of shareholders for review in strict accordance with the authorization provisions.
Article 25 the person in charge of the branch and subsidiary is the first person responsible for the information report of the company. At the same time, each branch and subsidiary shall designate a special person as the designated contact person to report the information to the Secretary of the board of directors and the office of the board of directors.
Article 26 the person in charge of each branch and subsidiary shall urge the company to strictly implement the information disclosure management and reporting system, and ensure that the major information that should be disclosed in the company is timely notified to the Secretary of the board of directors and the office of the board of directors.
Article 27 the above-mentioned personnel shall be responsible for the confidentiality of the company’s undisclosed information and shall not disclose the undisclosed information to any unit or individual in any way.
Chapter VI audit supervision
Article 28 the company establishes an audit and supervision department, which is responsible to the board of directors of the company. The Audit Department of the company is responsible to the general manager of the company. All branches and subsidiaries shall accept the audit supervision of the company and actively cooperate with the Audit Department of the company to complete all audit work instructed by the company. No unit or individual shall refuse or hinder the auditors of the company from performing audit tasks according to law, and shall not retaliate against the auditors.
Article 29 the company will conduct a comprehensive audit of all branches and subsidiaries every six months. In order to facilitate the company to make a comprehensive assessment of the business conditions of each branch and subsidiary and the work performance of the operators.
Article 30 when the managers and financial principals of branches and subsidiaries leave their posts, the company must conduct a comprehensive audit on the work of the outgoing managers or financial principals during their tenure.
Article 31 major economic contracts signed by branches and subsidiaries must be reported to the company for audit and supervision before implementation. Major economic contracts that have not been confirmed by audit shall not be implemented. Major economic contracts include (but are not limited to) the following aspects:
1. Contracts for the purchase, construction, renovation and renovation of fixed assets, as well as budgets and final accounts;
2. Foreign investment (including equity investment and debt investment) contracts;
3. Cooperation project development contract with other investors;
4. Loan and other financing contracts;
5. Any form of external commitment, guarantee, property mortgage and pledge contract;
6. Major asset disposal contracts, including equity transfer, major property transfer, lease and other contracts.
Article 32 the company will irregularly arrange temporary special audits for major matters related to the operation and management of branches and subsidiaries.
Chapter VII supplementary provisions
Article 33 all branches and subsidiaries must earnestly perform the application and reporting functions of relevant matters in accordance with the provisions of this system, earnestly improve the operation and management, and accept the supervision and inspection of the company.
Article 34 in case of any conflict between this system and relevant national laws, regulations and the articles of association, the provisions of relevant laws, regulations and the articles of association shall prevail.
Article 35 matters not covered in this system shall be implemented in accordance with relevant national laws, regulations, normative documents and the articles of association.
Article 36 the system shall be formulated and revised by the board of directors of the company; The general manager’s office of the company is responsible for the explanation.
Article 37 this system shall be implemented from the date of deliberation and approval by the board of directors of the company.
Vanfund Urban Investment&Development Co.Ltd(000638) board of directors April 2002
