Henan Zhongyuan Expressway Company Limited(600020)
Working rules for independent directors
Chapter I General Provisions
Article 1 in order to further improve the corporate governance structure of Henan Zhongyuan Expressway Company Limited(600020) (hereinafter referred to as the “company”) and promote the standardized operation of the company, these detailed rules are formulated in accordance with the company law of the people’s Republic of China (hereinafter referred to as the “company law”), the rules for independent directors of listed companies, the governance standards of listed companies and other laws and regulations, as well as the provisions of Henan Zhongyuan Expressway Company Limited(600020) articles of Association (hereinafter referred to as the “articles of association”).
Article 2 an independent director refers to a director who does not hold any position other than a director in the company and has no relationship with the company and its major shareholders that may hinder his independent and objective judgment.
Article 3 the members of the board of directors of the company shall include at least one-third of the independent directors, and the independent directors shall include at least one accounting professional with senior professional title or certified public accountant qualification.
Candidates nominated as independent directors as accounting professionals shall have rich accounting professional knowledge and experience and meet at least one of the following conditions:
(I) have the professional qualification of certified public accountant;
(II) having a senior professional title, associate professor title or doctor’s degree in accounting, auditing or financial management;
(III) have senior professional titles in economic management, and have more than 5 years of full-time working experience in professional posts such as accounting, audit or financial management.
Article 4 independent directors have the obligation of good faith and diligence to the company and all shareholders. Independent directors shall earnestly perform their duties in accordance with the requirements of relevant laws and regulations and the articles of association, safeguard the overall interests of the company, and pay particular attention to the legitimate rights and interests of public shareholders and minority shareholders. Independent directors shall perform their duties independently and shall not be affected by the company’s major shareholders, actual controllers or units or individuals having interests with the company and its major shareholders and actual controllers. Independent directors shall ensure that they have enough time and energy to effectively perform their duties. In case of any situation that obviously affects the independence during his term of office, he shall notify the company in time and put forward solutions. If necessary, he shall resign.
Chapter II Conditions of appointment of independent directors
Article 5 an independent director shall have the qualifications suitable for the exercise of his functions and powers, and the appointment of an independent director shall meet the following basic conditions:
(I) be qualified to serve as a director of a listed company in accordance with laws, administrative regulations and other relevant provisions; (II) have the independence required by the articles of association, these rules and the CSRC and the stock exchange; (III) have basic knowledge of the operation of listed companies and be familiar with relevant laws, administrative regulations, rules and rules;
(IV) have more than five years of working experience in law, economics or other work necessary to perform the duties of independent directors;
(V) other conditions stipulated by laws, regulations and the articles of association.
Article 6 independent directors shall have no following bad records:
(I) he has been subject to administrative punishment by the CSRC in the past three years;
(II) during the period when the stock exchange publicly determines that it is not suitable to serve as a director of a listed company;
(III) having been publicly condemned by the stock exchange or criticized twice or more in the last three years;
(IV) during the period of serving as an independent director, he did not attend the meetings of the board of directors for two consecutive times or did not attend the meetings of the board of directors in person, accounting for more than one-third of the meetings of the board of directors in that year;
(V) the independent opinions expressed during the period of serving as an independent director are obviously inconsistent with the facts;
(VI) other circumstances recognized by Shanghai Stock Exchange.
Chapter III independence of independent directors
Article 7 independent directors must be independent. Independent directors shall perform their duties independently and shall not be affected by the company’s major shareholders, actual controllers or units or individuals having interests with the company and its major shareholders and actual controllers.
In principle, independent directors can concurrently serve as directors in up to five listed companies, and should ensure that they have enough time and energy to effectively perform their duties.
Article 8 independent directors must be independent. The following persons shall not serve as independent directors of the company:
(I) personnel working in the company or its affiliated enterprises and their immediate family members and main social relations (immediate family members refer to spouses, parents, children, etc.; main social relations refer to brothers and sisters, parents in law, daughter-in-law and son-in-law, spouses of brothers and sisters, brothers and sisters of spouses, etc.);
(II) natural person shareholders and their immediate family members who directly or indirectly hold more than 1% of the issued shares of the company or are among the top ten shareholders of the company;
(III) persons who work in shareholder units that directly or indirectly hold more than 5% of the issued shares of the company or in the top five shareholder units of the company and their immediate family members;
(IV) personnel who work in the actual controller of the company and its subsidiaries;
(V) personnel providing financial, legal and consulting services for the company and its controlling shareholders or their respective subsidiaries, including all personnel of the project team of the intermediary providing services, reviewers at all levels, personnel signing the report, partners and main principals;
(VI) serve as a director, supervisor or senior manager in a unit that has significant business dealings with the company and its controlling shareholders or their respective subsidiaries, or serve as a director, supervisor or senior manager in the controlling shareholder unit of the business dealings unit;
(VII) persons who have had the situations listed in the preceding six items in the most recent year;
(VIII) other personnel who are not independent as determined by the CSRC or the stock exchange.
Chapter IV nomination, election and replacement of independent directors
Article 9 the board of directors, the board of supervisors and shareholders who individually or jointly hold more than 1% of the issued shares of the company may propose candidates for independent directors, which shall be elected and decided by the general meeting of shareholders.
Article 10 the nominee of an independent director shall obtain the consent of the nominee before nomination. The nominees shall fully understand the basic information of the nominees such as their occupation, educational background, professional title, detailed work experience and all part-time jobs, and express their opinions on their qualifications and independence as independent directors. The nominees shall make a public statement that there is no relationship between themselves and the company that affects their independent and objective judgment.
Article 11 before the shareholders’ meeting for the election of independent directors is held, the board of directors of the company shall publish the relevant contents in accordance with Article 10 of these rules, and submit the relevant materials of all nominees to Shanghai Stock Exchange at the same time. If the board of directors of the company has any objection to the relevant information of the nominee, it shall submit the written opinions of the board of directors at the same time.
The company shall not submit a candidate for independent director who raises an objection from the stock exchange to the general meeting of shareholders for election as an independent director.
Article 12 The term of office of independent directors is the same as that of other directors of the company. Upon expiration of the term of office, they can be re elected, but the term of re-election shall not exceed six years.
Article 13 If an independent director fails to attend the meeting of the board of directors in person for three consecutive times, the board of directors shall request the general meeting of shareholders to replace him. Before the expiration of the term of office of an independent director, the company may remove him through legal procedures. In case of early dismissal, the company shall disclose it as a special disclosure.
Article 14 an independent director may resign before the expiration of his term of office. When an independent director resigns, he shall submit a written resignation report to the board of directors to explain any situation related to his resignation or deemed necessary to attract the attention of shareholders and creditors of the company. If the resignation of an independent director causes the number of independent directors or members of the board of directors to be lower than the minimum number specified in the statutory or the articles of association, the resignation report of the independent director shall fill the vacancy in the next independent director
Article 15 when the independent directors fail to meet the conditions for independence or other circumstances unsuitable for performing the duties of independent directors, resulting in the failure of the company’s independent directors to meet the minimum number requirements specified in the statutory or the articles of association, the company shall supplement the number of independent directors as required.
Chapter V functions and powers of independent directors
Article 16 independent directors shall attend the meeting of the board of directors on time, understand the production, operation and operation of the company, and take the initiative to investigate and obtain the information and materials needed to make decisions.
Article 17 in order to give full play to the role of independent directors, in addition to the functions and powers conferred on directors by the company law, other relevant laws, regulations and the articles of association, the company also grants the following special functions and powers to independent directors:
(I) related party transactions that need to be submitted to the general meeting of shareholders for deliberation shall be submitted to the board of directors for deliberation after the independent directors express their prior approval opinions. Before making a judgment, independent directors can hire an intermediary to issue a special report as the basis for their judgment;
(II) propose to the board of directors to employ or dismiss the accounting firm. The appointment or dismissal of the accounting firm by the company shall be approved by the independent directors before being submitted to the board of directors for discussion;
(III) propose to the board of directors to convene an extraordinary general meeting of shareholders;
(IV) propose to convene the board of directors;
(V) the voting rights may be publicly solicited from shareholders before the general meeting of shareholders is held.
(VI) independently employ intermediary institutions to audit, verify or express professional opinions;
(VII) other functions and powers specified in laws and regulations, relevant provisions of CSRC and Shanghai Stock Exchange and the articles of association.
Independent directors shall obtain the consent of more than half of all independent directors when exercising the functions and powers in items (I) to (V) of the preceding paragraph, and shall obtain the consent of all independent directors when exercising the functions and powers in Item (VI) of the preceding paragraph.
Items (I) (II) can be submitted to the board of directors for discussion only after more than half of the independent directors agree.
If the proposals listed in the first paragraph of this article are not adopted or the above functions and powers cannot be normally exercised, the company shall disclose the relevant information.
Article 18 where the board of directors of the company sets up remuneration and assessment, audit, nomination and other committees, independent directors shall account for more than half of the members of the Committee and act as the convener. At least one independent director of the audit committee shall be an accounting professional.
Article 19 independent directors shall express independent opinions on major matters of the company
(I) in addition to performing the above duties, independent directors shall also express independent opinions to the board of directors or the general meeting of shareholders on the following matters:
1. Nomination, appointment and removal of directors;
2. Appoint or dismiss senior managers;
3. Remuneration of directors and senior managers of the company;
4. The company’s shareholders, actual controllers and their affiliated enterprises’ existing or new loans or other capital transactions with a total amount of more than 3 million yuan or more than 5% of the company’s recently audited net asset value, and whether the company has taken effective measures to recover the arrears;
5. Employ and dismiss accounting firms;
6. Changes in accounting policies, accounting estimates or correction of major accounting errors due to reasons other than changes in accounting standards;
7. The company’s financial and accounting reports and internal control are issued with non-standard unqualified audit opinions by accounting firms;
8. Internal control evaluation report;
9. The scheme for the relevant parties to change their commitments;
10. The impact of preferred stock issuance on various shareholders’ equity of the company;
11. Formulate profit distribution policies, profit distribution plans and cash dividend plans; Formulate a plan for converting capital reserve into share capital;
12. Related party transactions to be disclosed, provision of guarantees (excluding guarantees for subsidiaries within the scope of consolidated statements), entrusted financial management, provision of financial assistance, use of raised funds, investment in stocks and their derivatives and other major matters;
13. Major asset restructuring plan, management acquisition, equity incentive plan, employee stock ownership plan, share repurchase plan and debt repayment plan of related persons of listed companies;
14. The company intends to decide that its shares will no longer be traded on the Shanghai Stock Exchange;
15. Matters that independent directors believe may damage the rights and interests of public shareholders and minority shareholders;
16. Other matters stipulated by laws and regulations, China Securities Regulatory Commission, Shanghai Stock Exchange or the articles of association. (II) independent directors shall express one of the following opinions on the above matters: agree; Reservations and their reasons; (a) the reasons and objections; Inability to express opinions and its obstacles.
(III) if the relevant matters need to be disclosed, the company shall announce the opinions of the independent directors. If the independent directors have different opinions and can not reach an agreement, the board of directors shall disclose the opinions of each independent director separately.
Article 20 the independent opinions issued by independent directors on major matters shall at least include the following contents: (I) basic information of major matters;
(II) the basis for expressing opinions, including the procedures performed, verification documents, contents of on-site inspection, etc;
(III) legality and compliance of major matters;
(IV) the impact on the rights and interests of the company and minority shareholders, possible risks and whether the measures taken by the company are effective;
(V) concluding observations. In case of reservations, objections or inability to express opinions on major matters, the relevant independent directors shall clearly state the reasons and obstacles to express their opinions.
The independent directors shall sign and confirm the independent opinions issued, and timely report the above opinions to the board of directors, which shall be disclosed together with the relevant announcements of the company.
Article 21 If an independent director finds that the company has any of the following circumstances, he shall actively perform the obligation of due diligence and report to the Shanghai Stock Exchange in time. If necessary, he shall hire an intermediary institution for special verification:
(I) important matters fail to perform the review procedures as required;
(II) failing to perform the obligation of information disclosure in time;
(III) there are false records, misleading statements or major omissions in the information disclosure;
(IV) other situations suspected of violating laws and regulations or damaging the legitimate rights and interests of minority shareholders.
Article 22 in case of any of the following circumstances, the independent director shall report to the Shanghai Stock Exchange in time:
(I) being dismissed by the company, and I think the reason for dismissal is improper;
(II) the independent director resigns due to the company’s situation that hinders the independent director from exercising his functions and powers according to law;
(III) the meeting materials of the board of directors are incomplete or the argument is insufficient, and the proposal of two or more independent directors in writing to postpone the meeting of the board of directors or postpone the consideration of relevant matters has not been adopted;
(IV) the board of directors fails to take effective measures after reporting the suspected illegal acts of the company or its directors, supervisors and senior managers to the board of directors;
(V) other circumstances that seriously hinder independent directors from performing their duties.
Article 23 independent directors shall submit and disclose their work report to the annual general meeting of shareholders of the company. The work report shall include the following contents:
(I) ways, times and voting of attending the board of directors throughout the year, and times of attending the general meeting of shareholders as nonvoting delegates;
(II) the situation of expressing independent opinions;
(III) on site inspection;
(IV) propose to convene the board of directors and propose to employ or dismiss the board of directors
