Corporate Governance Report

Corporate Governance Code

The Group recognises the importance of achieving the highest standard of corporate governance consistent with the needs and requirements of its businesses and the best interest of all of its stakeholders and is fully committed to doing so. It is also with these objectives in mind that the Group has applied the principles of the code provisions of the Corporate Governance Code (the "CG Code") contained in Appendix 14 to the Listing Rules.
 
In the opinion of the Directors, the Company has complied with the code provisions and, where appropriate, adopted the applicable recommended best practices set out in the CG Code throughout the year ended 31 December 2021.

Directors' Securities Transactions

The Company has adopted the Model Code as set out in Appendix 10 to the Listing Rules as its own code of conduct for dealing in securities of the Company by the Directors and also implemented internal policy to govern the dealing in securities of the Company by the employees of the Group. In response to specific enquiry made, all the Directors confirmed that they had complied with the required standards of dealings as set out in the Model Code during the year under review.

Board of Directors

The Board which is accountable to the shareholders of the Company, is responsible for the leadership and control of the Company and oversees the Group's businesses, strategic decisions and performances. The management is entrusted by the Board with the authority and responsibility for the day-today management of the Group. Major corporate matters that are specifically delegated by the Board to the management include the preparation of interim and annual reports and announcements for Board approval before publishing, execution of business strategies and initiatives adopted by the Board, implementation of adequate systems of internal controls and risk management procedures, and compliance with relevant statutory and regulatory requirements and rules and regulations. It is the responsibility of the Board to determine the appropriate corporate governance practices applicable to the Company's circumstances and to ensure processes and procedures are in place to achieve the Company's corporate governance objectives.
 
As at the date of this report, the Board comprises six Executive Directors, being Mr. LAN Runing who is also the Chairman of the Board, Mr. KUANG Hu, who is also the Vice Chairman of the Board, Mr. LI Yonggang, who is also the Managing Director, Mr. WU Mingchang, Ms. ZHU Guang and Mr. JIAO Li who is also the Chief Financial Officer, and three Independent Non-Executive Directors, being Mr. Alan Howard SMITH, Mr. Felix FONG Wo and Mr. Vincent Marshall LEE Kwan Ho.
 
An updated list of Directors identifying their roles and functions is available on the websites of the Company and Hong Kong Exchanges and Clearing Limited ("HKEx").
 
The Board meets regularly to discuss the overall strategy as well as the operation and financial performance of the Company, and to review and approve the Company's annual, interim and quarterly results. During the year under review, fourteen Board meetings were held and attendance of each Director at the Board meetings is set out in the section headed "Board and Committees Meetings" of this report.
 
The Company has devised the annual meeting schedule for next year before the end of the year, setting out all meeting dates of the Board and its committees, in order for the Directors to plan ahead. At least fourteen days' notice of a Board meeting is normally given to all Directors who are provided with an opportunity to include matters for discussion in the agenda. The Company Secretary assists the Chairman in preparing the agenda for meetings to comply with all applicable rules and regulations. The agenda and the accompanying Board papers are normally sent to Directors at least three days before the intended date of a Board meeting. Draft minutes of each Board meeting are circulated to Directors for their comment before being tabled at the next Board meeting for approval. All minutes are kept by the Company Secretary and are open for inspection at any reasonable time on reasonable notice by any Director.
 
According to the current Board practice, if a Director has a conflict of interest in a matter to be considered by the Board, which the Board has determined to be material, the matter will be dealt with by the Board at a duly convened Board meeting. The Bye-Laws also stipulate that save for the exceptions as provided therein, a Director shall abstain from voting and not be counted in the quorum at meetings for approving any contract or arrangement in which such Director or any of his/her associates has a material interest. Every Director is entitled to have access to the Board papers and related materials as well as to the advice and services of the Company Secretary.

Corporate Governance Functions

It is the responsibility of the Board to determine the appropriate corporate governance practices applicable to the Company's circumstances and to ensure processes and procedures are in place to achieve the Company's corporate governance objectives.
 
The duties of the Board performing corporate governance functions under the CG Code include:

(a) to develop and review the Company's policies and practices on corporate governance;
(b) to review and monitor the training and continuous professional development of Directors and senior management of the Company;
(c) to review and monitor the Company's policies and practices on compliance with legal and regulatory requirements;
(d) to develop, review and monitor the code of conduct and compliance manual (if any) applicable to employees and Directors of the Company; and
(e) to review the Company's compliance with the CG Code and the information disclosed in the Corporate Governance Report.

During the year under review, the Board considered, among other matters, the following corporate governance issues:

(a)  reviewed the training and continuous professional development of Directors;
(b) monitored the report or complaint regarding possible improprieties in financial reporting and internal control (if any);
(c) reviewed the effectiveness of the risk management and internal control systems of the Company through the Internal Audit Department and the Audit Committee; and
(d) reviewed the Company's compliance with the CG Code and the information disclosed in the Corporate Governance Report.

Chairman and Managing Director

As at the date of this report, the Chairman of the Board is Mr. LAN Runing and the Managing Director is Mr. LI Yonggang. Their roles are clearly defined and segregated to ensure independence, proper checks and balances. Mr. Lan provides leadership for the Board and oversees its functioning, ensuring that the Board works effectively and acts in the best interest of the Group. Under the guidance of the Board, Mr. Li as the Managing Director focuses on the day-to-day management of the Group’s business, and leads the management team of the Group.

Non-Executive Directors

All Directors, including Non-Executive Directors, appointed to fill a causal vacancy or as an additional member to the existing Board shall hold office only until the first general meeting after their appointment and shall be eligible for re-election.
 
Moreover, each Non-Executive Director (including Independent Non-Executive Director) is appointed for a term of not more than approximately three years expiring on the earlier of either (a) the conclusion of the annual general meeting of the Company in the year of the third anniversary of the appointment or reelection of that Director; or (b) the expiration of the period within which the annual general meeting of the Company is required to be held in the year of the third anniversary of the appointment or re-election of that Director and in any event, subject to earlier determination in accordance with the Bye-Laws and/or applicable laws and regulations.
 
During the year under review, the Non-Executive Directors (including Independent Non-Executive Directors) provided the Company with a wide range of expertise and a balance of skills and brought independent judgment on issues of strategic direction, development, performance and risk management through their contribution at Board meetings and committee meetings.

Independence of Independent Non-Executive Directors

During the year under review and up to the date of this report, the Company has complied with the requirements under Rules 3.10(1), 3.10(2) and 3.10A of the Listing Rules. The Company has received annual confirmation of independence from the three Independent Non-Executive Directors, namely Mr. Alan Howard SMITH, Mr. Felix FONG Wo and Mr. Vincent Marshall LEE Kwan Ho in accordance with Rule3.13 of the Listing Rules.
 
Mr. Alan Howard SMITH, Mr. Felix FONG Wo and Mr. Vincent Marshall LEE Kwan Ho have served the Board for more than nine years. They have clearly demonstrated their willingness to exercise independent judgement and to provide objective opinions to the management. There is no evidence that length of tenure is having an adverse impact on their independence. The Board therefore considers that Mr. Alan Howard SMITH, Mr. Felix FONG Wo and Mr. Vincent Marshall LEE Kwan Ho remain independent, notwithstanding the length of their tenure.
 
The Nomination Committee has assessed the independence of all the Independent Non-Executive Directors and has concluded that all of them are independent within the definition of the Listing Rules. Further, up to the date of this report, the Board is not aware of the occurrence of any events, which would cause it to believe that the independence of any of the Independent Non-Executive Directors has been impaired.

Relationship amongst Directors

The Board members do not have any financial, business, family or other material/relevant relationships with each other. Such balanced Board composition also ensures that strong independence exists across the Board. The profiles of the Directors as set out on pages 19 to 22 of the 2021 annual report, demonstrate a diversity of skills, expertise, experience and qualifications of the Directors.

Directors' Induction and Continuous Professional Development

Upon the appointment of the Board members, each newly appointed Director is provided with necessary induction and information to ensure that he/she has a proper understanding of the Company’s operations and businesses as well as his/her responsibilities under the relevant statutes, laws, rules and regulations.
 
The Company encourages the Directors to enroll in a wide range of professional development courses and seminars relating to the Listing Rules, Hong Kong ordinances and corporate governance practices so that they can continuously develop and refresh their relevant knowledge and skills. Some Directors attended seminars or conferences organised by government authorities, professional bodies or industrial organisations, etc. in relation to corporate governance, updates on laws, rules and regulations, accounting, financial, management or other professional skills. During the year, the Company organized training for Directors and provided them with reading materials.
 
According to the records kept by the Company, the Directors attended the following trainings during the year under review:

Name of Director

Attending Directors' trainings organised by the Company, other companies or organisations Reading materials

Executive Directors

LAN Runing (Note 1)

LI Yonggang

WU Mingchang

ZHU Guang

JIAO Li (Note 2)

XU Yeqin (Note 3)

ZHANG Jun (Note 4)

Independent Non-Executive Directors

Alan Howard SMITH

Felix FONG Wo

Vincent Marshall LEE Kwan Ho


Notes:

1. Mr. LAN Runing has been appointed as the Chairman and an Executive Director of the Company with effect from 15 September 2021. 

2. Mr. JIAO Li has been appointed as an Executive Director of the Company with effect from 15 September 2021.

3. Mr. XU Yeqin resigned as the Chairman and an Executive Director of the Company with effect from 15 September 2021.

3. Mr. ZHANG Jun resigned as an Executive Director of the Company with effect from 15 September 2021.

Board Diversity Policy

The Board has adopted a board diversity policy (the "Board Diversity Policy") which sets out the approach to achieve diversity on the Board.
 
The Company recognises and embraces the benefits of having a diverse Board and sees increasing diversity at Board level as an essential element in supporting the attainment of the Company's strategic objectives and sustainable development.
 
The Company seeks to achieve Board diversity through the consideration of a number of factors, including but not limited to gender, age, cultural background, educational level, length of service, professional experience, skills and knowledge. The Company will also take into consideration its own business model and specific needs from time to time. All Board appointments are based on meritocracy and candidates are considered against objective criteria, having due regard to the benefits of diversity on the Board.
 
The Nomination Committee has set the measurable objectives based on several focused areas: gender, age, cultural background, educational level, length of service, professional experience, skills and knowledge for the implementation of Board diversity of the Company. The Nomination Committee reviews the Board Diversity Policy, as appropriate, to ensure its continued effectiveness from time to time.
 
As at the date of this report, the Board comprises nine Directors, amongst them, three are Independent Non-Executive Directors, with diverse backgrounds, thereby promoting critical review and control of the management process. The Board maintains a balanced composition and is characterised by significant diversity, whether considered in terms of gender, age, professional experience, skills and knowledge.
 
Having reviewed the implementation of the Board Diversity Policy and the structure, size, members' gender and composition of the Board, the Nomination Committee and the Board considered that the Company had met the requirements of the Board Diversity Policy.

Dividend Policy

The Board has adopted a revised dividend policy on 28 April 2021 with the aims of generating stable and sustainable returns for the shareholders of the Company.
 
In deciding whether to recommend the payment of any dividend and in determining the amount thereof, the Board will take into account the Group’s operating income, operating cash flows, financial position, investment and financing needs, contractual restrictions imposed on the payment of dividends (if any), past dividend payments, dividend payout ratio from the peers and other factors that the Board considers appropriate. The Company strikes a balance between the sharing of the Company’s profit with the shareholders of the Company and preserve sufficient funds to facilitate its future development.
 
Since the Group is currently experiencing a fast business development stage, and takes an active approach in contemplating and delving into the possibility of seeking out opportunities for real estate development and investment projects mainly in the Guangdong-Hong Kong-Macao Greater Bay Area and the Pearl River Delta in order to pursue better future returns for the shareholders of the Company, and that the Group intends to prioritise the application of funds towards its existing projects and future business development. At this stage, the Board will adopt a progressive dividend policy to reward the shareholders of the Company.
 
The Board will review the revised dividend policy from time to time and may exercise at its sole and absolute discretion to update, amend and/or modify the revised dividend policy at any time as it seems fit and necessary.

Board Committees

The Board has established the Remuneration Committee, the Nomination Committee and the Audit Committee.

Remuneration Committee

The Company established the Remuneration Committee in June 2005. The Remuneration Committee has been delegated responsibility from the Board to determine the remuneration packages of individual Executive Directors and senior management. The terms of reference of the Remuneration Committee detailing its authority and duties are available on the websites of the Company and HKEx.
 
As at the date of this report, the Remuneration Committee comprises three Independent Non-Executive Directors, being Mr. Felix FONG Wo, Mr. Alan Howard SMITH and Mr. Vincent Marshall LEE Kwan Ho. Mr. Felix FONG Wo is the chairman of the Remuneration Committee.
 
The Remuneration Committee shall meet at least once a year in accordance with its terms of reference. Three Remuneration Committee meetings were held in 2021 and the attendance of each member is set out in the section headed "Board and Committees Meetings" of this report.
 
In 2021, the Remuneration Committee reviewed and approved the proposed remuneration packages for the newly appointed Executive Directors and individual Executive Directors’ annual remuneration package and performance bonus.
 
Details of the Directors emoluments for the year 2021 are set out in note 7 to the financial statements of the 2021 annual report.

Nomination Committee

The Company established the Nomination Committee in March 2012. The Nomination Committee is responsible for, amongst other things, reviewing the structure, size and composition of the Board, assisting the Board in the development and review of the Board Diversity Policy (and the measurable objectives for its implementation), and the Directors’ Nomination Policy, identifying individuals suitably qualified to become Board members, assessing the independence of Independent Non-Executive Directors in accordance with the criteria prescribed under the Listing Rules and the CG Code, making recommendation on the re-appointment of the retiring Directors and succession planning for Directors. The terms of reference of the Nomination Committee detailing its authority and duties are available on the websites of the Company and HKEx.
 
As at the date of this report, the Nomination Committee comprises the Chairman of the Board, Mr. LAN Runing, and three Independent Non-Executive Directors, being Mr. Alan Howard SMITH, Mr. Felix FONG Wo and Mr. Vincent Marshall LEE Kwan Ho. Mr. LAN Runing is the chairman of the Nomination Committee.
 
The Nomination Committee shall meet at least once a year in accordance with its terms of reference. Two Nomination Committee meetings were held in 2021 and the attendance of each member is set out in the section headed “Board and Committees Meetings” of this report.
 
In 2021, the Nomination Committee performed the works as summarised below:

(a) assessed the independence of the Independent Non-Executive Directors;
(b) considered and recommended to the Board the re-appointment of the retiring Directors;
(c) reviewed the implementation of the Board Diversity Policy and the structure, size, members' gender and composition of the Board; and
(d) considered and recommended to the Board for the appointments of the Chairman and Executive Directors of the Company.

Directors' Nomination Policy

The Board has adopted a Directors' nomination policy (the "Directors' Nomination Policy") to formally set out the criteria and process in the nomination and appointment of Directors. According to the Directors' Nomination Policy, the ultimate responsibility for selection and appointment of Directors rests with the entire Board or the shareholders in general meeting, as the case may be. The Board has delegated the relevant screening and evaluation process to the Nomination Committee, which identifies suitably qualified candidates and recommends them to the Board. In assessing the suitability of a proposed candidate, the Nomination Committee takes into consideration the candidate's integrity, qualifications, skills, knowledge, experiences relevant to the Company's business and corporate strategy, his/her commitment to enhancing shareholder value and devoting sufficient time to effectively carry out their duties, fulfilment of the independence requirements as set out in the Listing Rules (for Independent Non-Executive Directors) and diversity on the Board. After reaching its decision, the Nomination Committee nominates such candidates to the Board for approval and appointment. As mentioned above, all Directors appointed to fill a casual vacancy or as an additional member to the existing Board shall hold office only until the first general meeting after their appointment and shall be eligible for re-election. The Board will make recommendation to shareholders in respect of the proposed re-election of Directors at general meetings.

Audit Committee

The Company established the Audit Committee in September 1998. The Audit Committee oversees matters concerning the external auditor including making recommendations to the Board regarding the appointment of the external auditor, reviewing the scope of their audit work and approving their fees. The Audit Committee further ensures that the management has put in place effective systems of the risk management and internal control and maintains an overview of the Group's risk management system and financial controls. It reviews the adequacy of resources, qualifications and experience of staff of the Company's accounting, internal audit and financial reporting functions and their training and budget. In addition, it reviews the internal audit schedules of the Group, considers the Group's internal audit reports and monitors the effectiveness of the internal audit function. The terms of reference of the Audit Committee detailing its authority and duties are available on the websites of the Company and HKEx.
 
As at the date of this report, the Audit Committee comprises three Independent Non-Executive Directors, being Mr. Vincent Marshall LEE Kwan Ho, Mr. Alan Howard SMITH and Mr. Felix FONG Wo. Mr. Vincent Marshall LEE Kwan Ho is the chairman of the Audit Committee.
 
The Company has complied with Rule 3.21 of the Listing Rules, which requires that at least one of the members of the Audit Committee (which must comprise a minimum of three members with Non-Executive Directors only and must be chaired by an Independent Non-Executive Director) is an Independent Non-Executive Director who possesses appropriate professional qualifications or accounting or related financial management expertise.
 
The Audit Committee shall meet at least twice a year in accordance with its terms of reference. Four Audit Committee meetings were held in 2021 and the attendance of each member is set out in the section headed “Board and Committees Meetings” of this report. In addition to its four meetings as aforesaid, the Audit Committee also had one private meeting with the external auditor without the presence of the management to discuss any area of concern.
 
In 2021, the Audit Committee performed the works as summarised below:
 
(a) reviewed the annual caps on continuing connected transactions of the  Company;
(b) reviewed and recommended 2020 final results, auditor's findings and draft final results announcement for the Board's  approval;
(c) reviewed and considered various accounting issues and new accounting standards and their financial impacts;
(d) reviewed the internal audit plan of 2021;
(e) reviewed and recommended 2021 interim and quarterly results, auditor's findings, draft interim and quarterly results announcements for the Board's approval;
(f) reviewed and recommended the internal audit reports for the Board's approval; and
(g) assessed the effectiveness of risk management and internal control systems of the Group for 2020.

Auditors' Remuneration

The remuneration of the Company's auditor, PricewaterhouseCoopers and its other member firm, for services rendered in respect of the year ended 31 December 2021 is set out as follows::

Services rendered

Fee
HK$'000

Audit of annual financial statements

2,650

Review of interim financial report

885

Agreed-upon procedures in respect of quarterly results

576

Limited assurance on continuing connected transactions

60

Tax advisory services

135

 

4,306


Board and Committees Meetings

The individual attendance records of each Director at the meetings of the Board, the Nomination Committee, the Remuneration Committee, the Audit Committee and the general meetings of the Company during the year ended 31 December 2020 are set out below:

Name of Director

Board Meeting

Nomination Committee Meeting

Remuneration Committee Meeting

Audit Committee Meeting

Annual General Meeting

Executive Directors

LAN Runing (Note 1)

5/5

1/1

N/A

N/A

N/A

LI Yonggang

14/14

N/A

N/A

N/A

1/1

WU Mingchang

14/14

N/A

N/A

N/A

1/1

ZHU Guang

14/14

N/A

N/A

N/A

1/1

JIAO Li (Note 2)

5/5

N/A

N/A

N/A

N/A

XU Yeqin (Note 3)

9/9

2/2

N/A

N/A

1/1

ZHANG Jun ((Note 4)

9/9

N/A

N/A

N/A

1/1

Independent Non-Executive Directors

Alan Howard SMITH

14/14

2/2

3/3

4/4

1/1

Felix FONG Wo

14/14

2/2

3/3

4/4

1/1

Vincent Marshall LEE Kwan Ho

14/14

2/2

3/3

4/4

1/1


Notes:

1. Mr. LAN Runing has been appointed as the Chairman and an Executive Director of the Company with effect from 15 September 2021.

2. Mr. JIAO Li has been appointed as an Executive Director of the Company with effect from 15 September 2021.

3. Mr. XU Yeqin resigned as the Chairman and an Executive Director of the Company with effect from 15 September 2021.

4. Mr. ZHANG Jun resigned as an Executive Director of the Company with effect from 15 September 2021.

Accountability and Audit

The Board is responsible for overseeing the preparation of financial statements for the year ended 31 December 2021, which give a true and fair view of the financial position of the Group and of the results and cash flows for that financial year. In preparing the financial statements for the year ended 31 December 2021, the Board has selected appropriate accounting policies, applied them consistently in accordance with the Hong Kong Financial Reporting Standards and Hong Kong Accounting Standards which are pertinent to its operations and relevant to the financial statements, made judgements and estimates that are prudent and reasonable, and ensured the preparation of the financial statements on a going concern basis.
 
The Group endeavours to present a balanced, clear and comprehensible assessment of the Group’s performance, position and prospects. The annual and interim results of the Company are announced in a timely manner within the limit of three months and two months respectively after the end of the relevant periods in accordance with the Listing Rules. To further enhance the Company’s level of corporate governance and transparency, the Company has announced its unaudited financial information for the first and third quarters during the financial year ended 31 December 2021, and will continue to publish unaudited financial information for the two quarters in the future.
 
The Directors have acknowledged their responsibility for preparing all information and representations contained in the financial statements of the Company for the year ended 31 December 2021.

Risk Management and Internal Control

The Board has overall responsibilities for maintaining and ensuring effective implementation of the risk management and internal control systems of the Group. Such systems are designed to prudently manage the Group's risks within an acceptable risk profile. The Board has delegated to management the implementation of such systems of risk management and internal controls as well as the review of relevant financial, operational and compliance controls and risk management procedures.
 
The management under the supervision of the Board has established an on-going process for identifying, evaluating and managing the significant risks faced by the Group and this process includes updating the systems of risk management and internal control when there are changes to business environment or regulatory guidelines.
 
The management assists the Board with the implementation of all relevant policies and procedures on risk and control by identifying and assessing the risk faced and designing, operating and monitoring suitable risk management and internal control to mitigate and control these risks. The key processes that have been established in reviewing the adequacy and integrity of the systems of risk management and internal control include the following:
 
A defined management structure is maintained with specified limits of authority and control responsibilities, which is designed to (a) safeguard assets from inappropriate use; (b) maintain proper accounts; (c) ensure compliance with laws and regulations; and (d) identify, manage and mitigate key risks to the Group.
 
In addition to the duties of the Audit Committee as mentioned above, the Audit Committee, inter alia, reviews the financial controls, risk management, internal control systems of the Group and any significant internal control issues identified by the Internal Audit Department, the external auditor and the management. It also conducts review of the internal audit functions with particular emphasis on the scope and quality of the internal audits and independence of the Internal Audit Department. During its annual review, the Audit Committee also considers the adequacy of resources, qualifications and experience of staff of the Group's accounting, financial reporting and internal audit functions, and their training programmes and budgets.
 
The Internal Audit Department monitors compliance with policies and procedures and the effectiveness of the risk management and internal control systems and highlights significant findings in respect of any non-compliance. It plays an important role in the Group's risk management and internal control framework, and provides objective assurance to the Board that the sound internal control system is maintained and operated in compliance with the established processes and standards by performing periodic checking. The Internal Audit Department issues reports to the Board and relevant management covering various operational and financial processes of the Group and provides summary reports to the Audit Committee together with the status of implementation of their recommendation in each Audit Committee meeting.
 
An Inside Information Policy was adopted by the Company which sets out guidelines to the directors, officers and all relevant employees of the Group to ensure inside information (as defined in the Listing Rules) of the Group would be disseminated to the public in equal and timely manner in accordance with applicable laws and regulations.
 
The Board has reviewed the effectiveness of the Group's risk management and internal control systems and is satisfied that the risk management and internal control systems in place covering all material controls including financial, operational and compliance controls and risk management functions for the year under review and, up to the date of this report, are reasonably effective and adequate.

Company Secretary

The Company Secretary reports to the Chairman and the Managing Director of the Company and is responsible for advising the Board on corporate governance matters.
 
Ms. Christine MAK Lai Hung has been appointed as the Company Secretary of the Company with effect from 20 February 2020. She is a full time employee of the Company and has extensive experience in company secretarial and corporate governance practices with listed companies. For the year under review, Ms. Mak undertook over fifteen hours of relevant professional training to update her skills and knowledge.

Shareholders' Rights

The following procedures are subject to the Bye-Laws, the Companies Act 1981 of Bermuda and applicable legislations and regulations.
 
Procedures for shareholders to convene a special general meeting
 
Registered shareholders holding at the date of deposit of the requisition not less than one-tenth of the paid up capital of the Company carrying the right of voting at general meetings of the Company shall at all times have the right, by written requisition sent to the registered office of the Company at Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda for the attention of the Board or the Company Secretary, to require a special general meeting to be called by the Board for the transaction of any business specified in such requisition; and such special general meeting shall be held within two months after the deposit of such requisition. To ensure that the requisition is received by the Company at the earliest opportunity, a copy of the signed requisition should also be deposited at the head office of the Company in Hong Kong at 18th Floor, Guangdong Investment Tower, 148 Connaught Road Central, Hong Kong marked for the attention of the Board or the Company Secretary.
 
The written requisition must state the purpose of the general meeting, signed by the registered shareholders concerned and may consist of several documents in like form, each signed by one or more of those shareholders. The written requisition will be verified with the Company's share registrars and upon their confirmation that the requisition is proper and in order, the Company Secretary will ask the Board to convene a special general meeting by serving sufficient notice in accordance with the statutory and regulatory requirements to all the registered shareholders. On the contrary, if the written requisition is invalid, the shareholders concerned will be advised of this outcome and accordingly, a special general meeting will not be convened as requested.
 
If within 21 days from the date of deposit of the requisition the Board fails to proceed to convene a special general meeting, the requisitionists, or any of them representing more than one half of the total voting rights of all of them, may themselves convene a special general meeting, but any meeting so convened shall not be held after the expiration of three months from the said date.
 
Procedures for shareholder to put forward proposals at general meetings
 
The Company holds an annual general meeting every year, and may hold a general meeting known as a special general meeting whenever necessary.
 
Registered shareholder(s) of the Company holding (a) not less than one-twentieth of the total voting rights of all shareholders having the right to vote at the general meeting; or (b) not less than 100 shareholders, can submit a written request stating the resolution intended to be moved at the next annual general meeting; or a statement of not more than 1,000 words with respect to the matter referred to in any proposed resolution or the business to be dealt with at a particular general meeting.
 
The written request/statements must be signed by the shareholder(s) concerned and deposited at the Company's registered office at Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda for the attention of the Board or the Company Secretary, not less than six weeks before the annual general meeting in the case of a requisition requiring notice of a resolution and not less than one week before the general meeting in the case of any other requisition. To ensure that the requisition is received by the Company at the earliest opportunity, a copy of the signed requisition should also be deposited at the head office of the Company in Hong Kong at 18th Floor, Guangdong Investment Tower, 148 Connaught Road Central, Hong Kong marked for the attention of the Board or the Company Secretary.
 
If the written request is in order, the Company Secretary will ask the Board (a) to include the resolution in the agenda for the annual general meeting; or (b) to circulate the statement for the general meeting, provided that the shareholder(s) concerned have deposited a sum of money reasonably determined by the Board sufficient to meet the Company's expenses in serving the notice of the resolution and/or circulating the statement submitted by the shareholder(s) concerned in accordance with the statutory requirements to all the registered shareholders. On the contrary, if the requisition is invalid or the shareholder(s) concerned have failed to deposit sufficient money to meet the Company's expenses for the said purposes, the shareholder(s) concerned will be advised of this outcome and accordingly, the proposed resolution will not be included in the agenda for the annual general meeting; or the statement will not be circulated for the general meeting.
 
The procedures for shareholder(s) to propose a person for election as a director of the Company are posted on the Company's website.
 
Shareholders' enquiries
 
Shareholders should direct their enquiries about their shareholdings to the Company's Hong Kong branch share registrar and transfer office, Tricor Tengis Limited, via its online holding enquiry services at www.tricoris.com, or send email to is-enquiries@hk.tricorglobal.com or call its hotline at (852) 2980 1333, or go in person to its public counter at Level 54, Hopewell Centre, 183 Queen's Road East, Hong Kong.
 
Shareholders may also send written enquiries to the Company, for the attention of the Chief Financial Officer or the Company Secretary by mail to 18th Floor, Guangdong Investment Tower, 148 Connaught Road Central, Hong Kong or by fax to (852) 2815 2020.
 
In addition, the Company is committed to maximising the use of its website as a channel to provide updated information in a timely manner and to strengthen the communications with both the public and the shareholders. The Company has formulated the “Shareholders Communication Policy” which enables shareholders to exercise their rights in an informed manner.

Investor Relations

The Company actively promotes investor relations and communication with the investment community throughout the year under review. The Company responds to requests for information and queries from the investment community including shareholders, analysts and the media.
 
The Board is committed to providing clear and full information on the Company to shareholders through the publication of notices, announcements, circulars, interim and annual reports. Moreover, additional information on the Company is also available to shareholders and stakeholders through the "Investor Relations" page on the Company's website.

Constitutional Documents

During the year under review, there were no significant changes in the Company's Memorandum of Association and Bye-Laws. An up-to-date version of the Company's Memorandum of Association and Bye-Laws is available on the websites of the Company and HKEx.

Relationship with Stakeholders

The Company recognises that employees, customers and suppliers and business associates are key stakeholders to the Company's success. We strive to achieve corporate sustainability through engaging our employees, providing quality services to our customers, collaborating with business partners (including suppliers and contractors) to deliver quality sustainable products and services and supporting our community.
 

By Order of the Board

LAN Runing

Chairman

Hong Kong, 30 March 2022