The Board delegates certain responsibilities to various committees. In accordance with the relevant PRC laws and regulations and the corporate governance practice prescribed in the Hong Kong Listing Rules, our Company has formed four Board committees, namely Strategy and Development Committee, Audit Committee, Nomination and Remuneration Committee and Risk Management Committee.

Strategy and Development Committee

We have established a Strategy and Development Committee with written terms of reference. The Strategy and Development Committee consists of eleven Directors: namely Mr. Chen Youan, Mr. Gu Weiguo, Mr. Xu Guoping, Mr. Wu Chengming, Mr. Li Chenghui, Mr. Shixun, Ms. Qi Xiaoli, Mr. Wang Shiding, Mr. Liu Feng, Mr. Wu Yuwu and Mr. Zhou Ruijin. Mr. Chen Youan currently serves as the chairman of the Strategic and Development Committee. The primary duties of the Strategy and Development Committee include, but are not limited to, the following:

to review the strategic development plans and to make recommendations to the Board;

to carry out information exchange and research within the industry, to understand and master the development and trend of macro economy and securities industry and to prepare specific strategic reports;

to conduct preliminary review of the Company’s annual operation plans and financial budget and to make recommendations to the Board;

to review the Company’s strategic capital allocation plans and to make recommendations to the Board;

to evaluate the balanced development of various business lines and to make recommendations to the Board;

to review the major organizational restructuring and organizational structure plans and to make recommendations to the Board;

to conduct preliminary review of the Company’s major investment, assets disposal and financing plans and to make recommendations to the Board;

to study other major issues affecting the development of the Company and to make recommendations to the Board; and

other matters as authorized by the Board.

Audit Committee

We have established an Audit Committee with written terms of reference. The Audit

Committee consists of five Directors: namely Mr. Wang Shiding, Mr. Liu Feng, Mr. Wu Yuwu,

Mr. Zhou Ruijin and Mr. Shi Xun. Mr. Wang Shiding currently serves as the chairman of the Audit Committee. The primary duties of the Audit Committee include, but are not limited to, the following:

to supervise the disclosure of the Company’s accounting information and other major issues, to review the critical accounting policies and their implementation, to monitor the implementation of the Company’s major financial decisions and annual budget, to monitor the truthfulness, accuracy and integrity of the Company’s financial reports, as well as the effectiveness of the procedures for the management to implement the financial reports, to monitor the integrity of the Company’s financial statements, annual reports, accounts, half yearly reports and quarterly reports and to review the significant opinions regarding financial filing contained in the financial statements and reports;

to monitor the annual audit and make judgment on the truthfulness, accuracy and integrity of the audited information contained in the financial reports, and to submit to the Board for review;

to control and manage connected transactions under the leadership of the Board, to analyze and identify connected persons, to monitor connected transactions to ensure compliance and to organize the decision-making process of major connected transactions;

to review and evaluate the Company’s internal control system;

to formulate the Company’s internal audit development plans, to approve the annual audit plans and to file such plans with the Board;

to review, monitor and evaluate the Company’s internal audit, to monitor the Company’s internal audit system and the implementation of internal audit plans, and to review and evaluate the procedure and effectiveness of the work of internal audit departments;

to review the internal audit and management system, the annual budget, the internal organizational structure plans of the audit department and the composition of the full-time audit team proposed by the management;

to nominate the general manager and vice general manager of the internal audit department and to report to the Board for appointment according to the procedure as specified in the Company’s rules in respect of the appointment of personnel;

to conduct annual review on the performance of the responsible persons of the internal audit departments according to the applicable regulations;

to review the Company’s internal audit reports, audit brief, annual bulletin as well as management proposal;

to approve that the Company’s audit department temporarily freezes the related materials and assets of the entities audited;

to make recommendations to the Board on the appointment, re-appointment and removal of the external auditors, to approve the remuneration and the terms of appointment of the external auditors and to deal with any relevant issues regarding the resignation or removal of external auditors;

to supervise the performance of the external auditors, and review and monitor the independence and objectivity of the external auditors and the effectiveness of the audit procedure in accordance with applicable standards. The Audit Committee should discuss the nature and scope of the audit and the related filing responsibilities with the auditors before the commencement of audit;

to develop and implement the policy on engaging external auditors to provide non-audit services. The external auditors include any entity that is under the same control, ownership or management with the audit firm, or any entity that a reasonable and informed third party knowing all relevant information would reasonably conclude to be part of the audit firm nationally or internationally. The Audit Committee should report to the Board, identifying and making recommendations on any matters where action or improvement is needed;

to monitor the Company to ensure that the internal audit departments have sufficient resources and to coordinate between the internal audit departments and the external auditors;

to oversee the implementation of the rectifying measures by the management in response to the audit opinion and to monitor the implementation of the audit opinions by the management;

to lead the internal audit departments in collecting, summarizing and looking into the materials relating to the responsibility of material mistakes in the information disclosure of the annual reports and to investigate and provide solutions for implementation after the Board’s review and approval; and

other matters as authorized by the Board.

Nomination and Remuneration Committee

We have established a Nomination and Remuneration Committee with written terms of reference. The Nomination and Remuneration Committee consists of five Directors: namely Mr. Liu Feng, Mr. Wang Shiding, Mr. Wu Yuwu, Mr. Zhou Ruijin and Mr. Li Chenghui. Mr. Liu Feng currently serves as the chairman of the Nomination and Remuneration Committee. The primary duties of the Nomination and Remuneration Committee include, but are not limited to, the following:

to make recommendations to the Board on the size and composition of the Board and the Board committees based on the Company’s operation, total amount of assets and equity structure;

to make recommendations to the Board on the number and composition of the senior management based on the Company’s requirements of business operation, as well as the requirements of the regulatory authorities;

to review the selection criteria and procedures for the Directors and senior management and to make recommendations to the Board; to conduct evaluation on the structure, size and composition (including skills, knowledge and experience) of the Board at least once a year and to make recommendations on any proposed changes to the Board for the purpose of implementing the corporate strategy;

to study and formulate the selection criteria and procedures of the members of the committees under the Board, and to make recommendations to the Board on the appointment, re-appointment and succession plans of Directors (especially for the chairman and the General Manager (President));

to search broadly for qualified individuals as candidates for Directors and senior management;

to conduct preliminary review of the qualifications and conditions (including the independence of the independent Directors) of the candidates for Directors (including independent Directors) based on the selection criteria and procedures and to make recommendations to the Board;

to review the qualifications and conditions of the candidates for General Manager (President), Chief Compliance Officer and secretary to the Board nominated by the chairman, as well as the Vice General Manager (Vice President) and senior management, including Chief Financial Officer, as nominated by the General Manager (President) based on the selection criteria and procedures and to make recommendations to the Board;

to make recommendations to the Board on the candidates for the members of other committees under the Board;

to formulate development plans of the senior management and training plans of key candidates and to make recommendations to the Board;

to review and provide opinion on the assessment and remuneration management system for Directors and senior management;

to formulate the criteria and the procedure for the review of the performance of Directors and senior management; to implement and provide opinion on the performance review of Directors and senior management;

according to the policy and target set by the Board, to formulate incentive policy and plans for the Directors (including non-executive Directors) and senior management after following the formal and transparent procedures and taking into consideration the salaries paid by comparable companies, responsibilities, time commitment, as well as the terms of employment of other positions of the Company (including controlled subsidiaries) and to make recommendations to the Board;

to make recommendations to the Board on the special remuneration packages (including non-monetary benefits, pension as well as compensation for any loss or termination of office or appointment) of executive Directors, Supervisors and senior management;

to review and approve the compensation to be paid to executive Directors or senior management for any loss or termination of office or appointment and to ensure it is consistent with contractual terms and is otherwise fair and not excessive;

to review and approve compensation arrangements relating to dismissal or removal of Directors for misconduct and to ensure that they are consistent with contractual terms and are otherwise reasonable and appropriate;

to ensure that no Director or his associate is involved in the determination of his own remuneration;

to provide opinion on the directors service agreements to be approved by the Shareholders. The above-mentioned agreements include agreements with a service term of more than three years, agreements that require a notice period of more than one year or compensation in the amount of more than one year’s remuneration or other payments in case of termination of the agreement by the Company, or agreements as required by the securities regulatory authorities where the Company is listed;

to review the Company’s fundamental remuneration management system and policies and to evaluate its effectiveness; and

other matters as authorized by the Board.

Risk Management Committee

We have established a Risk Management Committee with written terms of reference. The Risk Management Committee consists of seven Directors: namely Mr. Li Chenghui, Mr. Gu Weiguo, Mr. Xu Guoping, Mr. Wu Chengming, Mr. Shixun, Mr. Liu Feng and Ms. Qi Xiaoli. Mr. Li Chenghui currently serves as the chairman of the Risk Management Committee. The primary duties of the Risk Management Committee include, but are not limited to, the following:

to review the Company’s risk management policies and standards, as well as the fundamental concepts and scope of compliance management;

to review and provide comment on the overall target and basic policy of the compliance and risk management;

to supervise and monitor the development of risk and compliance management system of the Company;

to formulate the Company’s corporate governance policies, to monitor its implementation and to make recommendations to the Board;

to review and provide comment on the organizational structure and responsibilities of the Company’s compliance and risk management;

to review the Company’s compliance reports and risk assessment reports that need to be reviewed by the Board, and to make proposals on the improvement of the Company’s compliance and risk management;

to review and monitor the training and continuous professional development of the Directors and senior management;

to review and monitor the Company’s policies regarding compliance with laws and regulatory rules as well as with its implementation;

to formulate, review and monitor the Professional Practice Code and Compliance Manual (if available) of the employees and Directors;

to monitor the Company’s compliance with the Corporate Governance Code as set out in Appendix 14 of the Hong Kong Listing Rules, together with the disclosure in the Corporate Governance Report;

to monitor the effective implementation of the risk and compliance management by the management of the Company and to evaluate the performance of the responsible senior management;

to be responsible for organizing the drafting and preliminary review of the authorization matrix, namely the authorization by Shareholders’ General Meeting to the Board, by the Board to the Chairman and by the Board to the General Manager (President) and to assess the delegation and its effectiveness by the General Manager (President);

to evaluate and opine on the risk of major decision making and solutions to the major risks of the Company that need to be reviewed by the Board; and

other matters as authorized by the Board.

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