Corporate governance

The Board of directors is the highest responsible body for the company's strategy, operation management and customer satisfaction, undertakes the mission of leading the company forward, exercises the decision-making power of the company's strategy and operation management, and ensures that the interests of customers and shareholders are safeguarded.

The main duties of the Board are:

• Formulate corporate governance plans;
• To examine plans for the increase or decrease of the company's registered capital, profit distribution plans and plans for making up losses;
• Review of the company's equity incentive plan, non-equity long-term incentive plan;
• To examine or approve the company's entry into or exit from industrial fields and approve the company's strategic planning;
• To approve major organizational changes and adjustments, management mechanism construction and business changes;
• To approve major financial policies, financial plans and commercial transactions;
• To approve the company's annual budget plan, annual business report and annual audit report;
• To approve the appointment, removal, remuneration and long-term incentives of senior managers of the company;
• To approve major HR policies and plans at the company level;
• To approve management plans concerning major risks and major crises of the company, and manage major emergencies;
• Approve the establishment of internal control and compliance system.

In 2024, the Board of Directors held a total of eight on-site meetings to review and make decisions on the company's medium and long-term strategic planning, annual business plan, audit report, profit distribution, capital increase and other matters.

The Board of Supervisors is the highest supervisory body of the company and exercises supervisory power on behalf of the shareholders. The position of the Board of supervisors is to be responsible for the survival, development and destiny of the company, and its basic powers are reflected in three aspects: leadership management, business review and strategic foresight. The Board of supervisors promotes the construction of the succession echelon of the company through cadre inspection and reserve cadre training, etc., and ensures that the company has successors;Through the establishment of a regularized, institutionalized and systematic supervision framework, the company can conduct all-round supervision on the performance of duties of directors and senior executives, the company's operation and financial situation, compliance and internal control system, etc., so as to promote the company to gradually move from the management based on experience to the management based on rules, and let the business operate freely within the boundaries.

In 2024, the Board of Supervisors improved the basic system and organizational construction of the Board of Supervisors, carried out cadre inspection work and reserve cadre resource pool management, carried out inspections and inspections in key risk areas, supervised the operation and management of the company, and guided and managed the construction of the board of directors of subsidiary companies.
The Supervisory Board will hold three meetings in 2024. Members of the Board of supervisors attended all board meetings, supervised the decision-making and operation of the Board of directors, and supervised and evaluated the performance of the duties of directors and senior executives.

There are 5 members of the supervisory Board, which are elected by the employees' representative committee and approved by the shareholders' meeting. On March 16, 2024, the shareholding employee Representative Committee and the shareholders' meeting held a new election of the Board of Supervisors, and elected a new board of Supervisors member and alternate supervisor.

Auditors are responsible for auditing the annual financial statements, assessing whether the financial statements are true and fair in accordance with accounting standards and auditing procedures, and issuing audit opinions on the financial statements.
The audit scope and the annual audit report are reviewed by the audit Committee. Any relationship or service that may affect the objectivity and independence of the external auditor shall be discussed with the Audit Committee. In addition, the independent auditor works with the Audit Committee to discuss possible issues, difficulties and management support during the audit.
Since 2024, the company has engaged Beijing Xingchanghua CPA as an independent auditor.

Keine has designed and implemented an internal control (" internal control ") system based on the organizational framework and operation model. The internal control management system and internal control framework issued by KEINE apply to all the company's processes (including business and finance), subsidiaries and business units. The internal control system is designed based on the COSO model, including five parts: control environment, risk assessment, control activities, information and communication, and supervision, and covers the internal control system of financial reports to ensure the truth, integrity and accuracy of financial reports.

The control environment is the basis of the internal control system. Kein is committed to advocating and maintaining the company's integrity culture, attaches great importance to professional ethics, and strictly abides by laws and regulations related to corporate citizenship ethics. The company has formulated the Employee Code of Business Conduct (BCG), which specifies the basic business behavior standards that all employees (including senior executives) must abide by in the company's business behavior, and routinely organizes training and signing for all employees to ensure that they read, understand and comply with BCG. Keine has established a complete governance structure, including the board of Directors, professional committees under the Board of directors, functional departments and management teams at all levels, and each organization has a clear mandate and a clear accountability mechanism. In terms of organizational structure, Coyne has clarified the separation of powers and responsibilities for each organization in order to monitor and check each other. The CFO of the company is responsible for the internal control management of the whole company, and the internal control management department reports the defects and improvement of the internal control to the CFO, and assists the CFO in building the internal control environment. The internal audit department conducts independent supervision and evaluation of the control status of all business activities of the company.

Keine has set up a special internal control and risk management department, which regularly carries out risk assessment for all business processes in the world, identifies, manages and monitors important risks facing the company, predicts potential risks caused by changes in external and internal environment, and submits the company's overall risk management strategy and response plan to the company's decision. Each process owner is responsible for identifying, assessing and managing business risks and taking appropriate internal control measures. The company has established an improvement mechanism for internal control and risk issues, which can effectively manage major risks.

Keine has established a global process and business change management system, issued a global unified business process architecture, and appointed a global process leader based on the business process architecture to be responsible for the construction of process and internal control. Global process leaders identify business critical control points and separation of responsibilities matrices for each process and apply them to all regions, subsidiaries and business units; Regularly organize compliance testing for critical control points and publish test reports to continuously monitor the effectiveness of internal controls; Optimize the process and internal control around operating pain points and key requirements of financial reporting, improve operational efficiency and efficiency, support accurate, reliable and compliant financial reporting, and help achieve business objectives; Conduct an annual control evaluation annually to evaluate the effectiveness of the overall process design and process execution of each business unit, and report the evaluation results to the Audit Committee.

The company establishes multi-dimensional information and communication channels, timely access to external information from customers, suppliers, etc., and establishes formal transmission channels for internal information of the company, and establishes a voice community for all employees to communicate freely on the internal liaison system. The management of the company communicates regularly with departments at all levels through daily meetings to effectively convey management orientation and ensure the effective implementation of management decisions. At the same time, the company publishes all business policies and procedures on the internal management system, and regularly organizes business process and internal control training by managers/process managers at all levels to ensure that all employees can grasp the information in a timely manner. The company has also established a regular communication mechanism between process managers at all levels to review the implementation of internal control, follow up and implement improvement plans for internal control problems.

The company has set up internal complaint channels, investigation mechanisms, anti-corrosion mechanisms and accountability systems, and clearly defined relevant rules in the "Honesty and Integrity Cooperation Agreement" signed with suppliers. Suppliers can report employees' misconduct according to the channels provided in the agreement, so as to assist the company in monitoring the integrity and integrity of employees. The internal audit department conducts an independent and objective evaluation of the company's overall control status, and investigates financially responsible violations of the business Code of conduct, and reports the audit and investigation results to the company's senior management and the audit committee. In addition, Kein has established an internal control assessment, accountability and impeachment mechanism for process responsible persons and regional managers at all levels, and routinely operates it. The audit committee and CFO of the company regularly review the company's internal control status, listen to the report on the improvement plan and implementation progress of internal control problems, and have the right to ask the process responsible person and business manager who are not satisfied with the internal control status to report the reasons and improvement plans.