Corporate Governance and Operations

Corporate Governance and Operations

Sailun Group operates in accordance with the governance structure of the shareholders' meeting, the board of directors, the supervisory board, and the management team, establishing a scientifically sound and highly efficient modern corporate governance system. The Group's board of directors includes the Strategic and Sustainable Development Committee, the Audit Committee, the Nomination Committee, and the Remuneration and Evaluation Committee, which assist the board of directors in making professional decisions and enhancing the quality of corporate decision-making.

Corporate Governance
Internal control management

Sailun Group has established and implemented robust and effective internal controls in accordance with the specifications of the corporate internal control system. This includes the establishment of management systems such as the Articles of Incorporation, the Management Provisions on Internal Audit, the Management Provisions on Management Standards, the Management Provisions on the Notification of Significant Risk Events, the Risk Management Provisions. Additionally, rules for meetings of shareholders, the board of directors, the supervisory board, specialized committees, and other governing bodies have been put in place so as to safeguard the Company's compliant operation.

Sailun Group has hired an accounting firm to audit the effectiveness of internal controls over financial reporting every year since 2014. The audit conclusions indicate that 'effective internal control over financial reporting has been maintained in all significant aspects.

Three meetings operation

The Board of Directors comprises 7 directors, including 3 independent directors and 3 female directors. The Supervisory Board comprises 3 supervisors, of whom 1 is an employee representative supervisor. In 2023, Sailun Group held 3 general meetings of shareholders, 10 board meetings, and 6 supervisory board meetings. Its decision-making procedures and information disclosure were compliant with regulatory requirements for listed companies.

Shareholders' equity

Sailun Group strictly complies with relevant laws and regulations and adheres to the principles of truthfulness, accuracy, completeness, timeliness, and fairness in information disclosure. In 2023, the group's information disclosure business earned the highest grade A rating from the Shanghai Stock Exchange.

Sailun Group places great importance on investor management work, assigning specialized personnel to oversee the reception of investor visits and establishing a multi-channel communication platform. It communicates with investors on a regular basis through public telephone lines, dedicated email addresses, the SSE interactive platform, and teleconferences, facilitating better understanding of the enterprise among small and medium-sized investors.

Since its listing, Sailun Group has consistently placed great importance on investor returns, adhering to a policy of continuous and stable profit distribution, and issuing cash dividends every year. In 2022, the company paid out a cash dividend of 459 million yuan (including tax) to shareholders, representing 34.47% of the net profit attributable to shareholders of the listed company for that year. This dividend amount ranked first among listed companies in China's tire industry.

Company Operations
Sustainable procurement

Sailun Group uses a variety of methods for developing a sustainable supply-chain system, including signing social responsibility commitments, environmental protection agreements, and integrity pledges with its suppliers, to ensure compliance with business ethics and environmental regulations. This comprehensive approach empowers the development of a green and sustainable supply chain system.

Sustainable development management

Sailun Group has established the Sustainable Development Strategy Management Office, tasked with formulating the group's sustainable development strategic objectives and medium- to long-term development plans, as well as promoting the achievement of the group's sustainable development strategic objectives.

Compliance management

Sailun Group strictly abides by laws and regulations, conscientiously fulfills legal obligations such as paying taxes, and has been consistently rated as an 'A-level tax credit unit' for many consecutive years.

Sailun Group has developed many compliance system guidelines that forbid actions that unfairly limit or exclude market competition in order to effectively address international trade frictions.

The group has established both domestic and international intellectual property protection systems, forming a "hierarchical and orderly" institutional support framework. This is aimed at effectively identifying and controlling intellectual property risks across all operational aspects, thereby safeguarding the group's R&D achievements and intellectual property rights from infringement. The group has been acknowledged as a "National Intellectual Property Advantageous Enterprise" and a "China Petroleum and Chemical Industry Intellectual Property Model Enterprise.

The group has established an integrity and self-discipline leadership team, formulated the "Integrity and Self-Discipline Management Regulations," and established a supervision system for individuals, matters, and work processes, ensuring the healthy and efficient operation of the company.

Sailun Group Co., Ltd. (Stock Code: 601058) 2019 All Rights Reserved.

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