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ESG Report

 

 

 

 

 

 

 
In order to assist the Directors to perform their responsibilities, the Board has set up four Board committees, namely, the executive committee, the audit committee, the remuneration committee and the nomination committee. The chairmen of all the committees are appointed by the Board, in which the audit committee and the remuneration committee are both chaired by an independent non-executive Director with written terms of reference which were discussed and approved by the Board. The related terms of reference of each committee have been published on the websites of the Company and the Stock Exchange. The duties of the four committees are as follows: Executive Committee

The Executive Committee was established in 2009 to approve and undertake the transactions on behalf of the Board in respect of each investment project within an authorised limit or other day-to-day business operations. The committee consists of the chairman or/and executive Directors.

The Executive Committee comprises:

  • Mr. Huang Liezhang (Chairman of the Board, appointed on 17th November 2017)
  • Mr. Zeng He
  • Mr. Cheng Jie
  • Mr. Xiong Gebing (Chairman of the Board, resigned on 17th November 2017)
Audit Committee

The Audit Committee was established in 2001 to review the Company’s financial reporting, internal control, risk management, appointment of auditor and corporate governance issues and make recommendations to the Board. The Audit Committee consists entirely of independent non-executive Directors, who are experienced in finance, internal audit, banking and logistics, and are therefore capable of providing expert opinions on the steady financial operations of the Company. Currently, the Audit Committee comprises three independent non-executive Directors.

The Audit Committee comprises:

  • Mr. Chan Kay-cheung (Chairman of the committee)
  • Ms. Yau Lai Man
  • Mr. Chow Bing Sing

The Audit Committee held two meetings in 2017 with an average attendance rate of 100% to review the following matters with the Company’s senior management and independent auditor:

  • Accounting principles adopted by the Company for preparing financial statements;
  • Draft annual report, interim report and financial statements of the Company;
  • Scope of audit work of external auditor;
  • Independent audit results of the Company’s financial statements;
  • Internal recommendations issued by external auditor to the management and the management’s response;
  • Appointment of external auditor for providing non-audit services to the Company;
  • Proposed audit fee for 2017;
  • Internal audit function (including its effectiveness) of the Company including internal audit policy, internal audit plan and internal audit reports, covering financial monitoring, internal control and risk management;
  • Corporate governance of the Company; and
  • Connected transactions of the Company.

Reference to the functions of the Audit Committee is available under the terms of reference of the Audit Committee which have been published on the websites of the Company and the Stock Exchange.

To further enhance the independence of the external independent auditors, some parts of the above meetings were only attended by independent non-executive Directors and the independent auditor.

Since 2009, the Board has delegated the corporate governance functions to the Audit Committee in accordance with the provision of Code D.3.1, as it considered members of the Audit Committee to be better positioned to provide an objective and independent guidance on governance-related matters.

The Audit Committee has reviewed the Company’s compliance with the provisions of the Code for the year and the disclosure in this Corporate Governance Report.

Terms of Reference

Remuneration Committee

The Remuneration Committee was established in 2005 to make recommendations to the Board on the remuneration policy of the Company and the remunerations of the Directors and executives appointed by the Board. The Remuneration Committee met twice in 2017 with an average attendance rate of 100%. Currently, the Remuneration Committee comprises three independent non-executive Directors and one executive Director and is chaired by an independent nonexecutive Director.

The Remuneration Committee comprises:

  • Mr. Chan Kay-cheung (Chairman of the committee)
  • Ms. Yau Lai Man
  • Mr. Chow Bing Sing
  • Mr. Huang Liezhang (Executive Director, appointed on 17th November 2017)
  • Mr. Xiong Gebing (Executive Director, resigned on 17th November 2017)

Reference to the functions of the Remuneration Committee is available under the terms of reference of Remuneration Committee which have been published on the websites of the Company and the Stock Exchange.

During the year, the Remuneration Committee reviewed the remuneration packages of the Directors of the Company (including executive Directors, non-executive Director and independent non-executive Directors) and discussed on the remuneration and benefits system and policy of the staff of the Group.

Remuneration of Executive Directors:
The remuneration of the executive Directors of the Company mainly includes basic salary, bonus and directors’ fee, which were determined by the Board by reference to various factors (including market conditions) upon the recommendations of the Remuneration Committee to the Board. The Company considers various factors in determining the remuneration such as market conditions, comparable companies and time of the executive Directors spent on managing the affairs of the Company. The executive Directors currently do not receive any director’s remuneration.

Remuneration of Non-executive Director:
Currently, the non-executive Director does not receive any director’s remuneration.

Remuneration of Independent Non-executive Directors:
The Company pays emoluments to independent non-executive Directors in form of directors’ fee. The Remuneration Committee will present a proposal to the Board, and the Board will make decisions based on market conditions.

Terms of Reference

Nomination Committee

The committee was established in 2011 and it is mainly responsible for making recommendations to the Board on the appointment of Directors and senior management. The Nomination Committee held one meeting in 2017 with attendance rate of 100%. Currently, the committee comprises four Directors, of which three are independent nonexecutive Directors.

The Nomination Committee comprises:

  • Mr. Huang Liezhang (Chairman of the Committee and Executive Director, appointed on 17th November 2017)
  • Mr. Chan Kay-cheung
  • Ms. Yau Lai Man
  • Mr. Chow Bing Sing
  • Mr. Xiong Gebing (Chairman of the Committee and Executive Director, resigned on 17th November 2017)

Reference to the functions of the Nomination Committee is available under the terms of reference of Nomination Committee which have been published on the websites of the Company and the Stock Exchange.

During the year, the Nomination Committee has made recommendations to the Board on re-election of retiring Directors and the new appointments for positions of resigned Directors. The Nomination Committee also reviewed the structure, size and composition of the Board and believed that the composition of the Board is diversified (also as disclosed in “Composition of the Board” above).

The Nomination Committee will consider the Board Diversity Policy when nominating the Directors (see the “Board Diversity Policy” in Corporate Governance section).

According to the Articles of Association, all Directors are subject to retirement by rotation and re-election at annual general meetings of the Company. New directors appointed by the Board during the year are required to retire and offer themselves for re-election at the first annual general meeting immediately following their appointments. Further, at each annual general meeting, one-third (if not a multiple of three, then the number nearest to but not more than one-third) of Directors shall retire from office by rotation and according to the provision of Code A.4.2, every Director shall be subject to retirement by rotation at least once every three years./p>

In accordance with Article 88(i) of the Articles of Association, Mr. Chan Kay-cheung will retire at the forthcoming annual general meeting of the Company and, being eligible, offer themselves for re-election. The Nomination Committee recommended to the Board that Mr. Chan Kay-cheung be nominated for re-election at the forthcoming annual general meeting of the Company.

In accordance with Article 84 of the Articles of Association, Mr. Huang Liezhang and Mr. Fan Linchun will retire at the forthcoming annual general meeting of the Company and, being eligible, offer himself for re-election. The Nomination Committee recommended to the Board that Mr. Huang Liezhang and Mr. Fan Linchun be nominated for re-election at the forthcoming annual general meeting of the Company.

Ms. Yau Lai Man should have been subject to retirement by rotation at the forthcoming annual general meeting under the provision of Code A.4.2, but only one of the Directors is required to retire by rotation according to the above provisions of the Articles of Association and the number of Directors required to retire by rotation at present. After careful consideration, it is determined that Ms. Yau Lai Man will not retire by rotation according to the provision of Code A.4.2 to avoid any violation of the Articles of Association, but will do so as soon as possible at the annual general meeting in 2019. In order to bring the existing Articles of Association in relation to the rotation of Directors to comply with the requirements of the Listing Rules so as to further enhance corporate governance, and taking into account actual circumstance of the Company, the Board proposed to amend Article 88 (i) of the Articles of Association with effect from the date of the passing of the relevant special resolution at the coming AGM.

Terms of Reference