Core Points - The article outlines the governance structure and responsibilities of independent directors at Xinghuan Information Technology (Shanghai) Co., Ltd, emphasizing the importance of independent judgment and protection of minority shareholders' rights [2][3][19] - It establishes criteria for the nomination, election, and replacement of independent directors, ensuring they remain free from conflicts of interest [11][12][19] - The document details the rights and obligations of independent directors, including their participation in decision-making and oversight of potential conflicts of interest [17][18] Group 1: Governance Structure - The company aims to enhance its governance structure and ensure compliance with relevant laws and regulations [2][3] - Independent directors must not hold any other positions within the company and should have no direct or indirect interests that could affect their judgment [2][3] - At least one-third of the board members must be independent directors, ensuring a balanced representation [6][19] Group 2: Qualifications and Independence - Independent directors must meet specific qualifications, including relevant work experience and a clean personal record [9][10] - Individuals with significant shareholding or familial ties to major shareholders are prohibited from serving as independent directors [10][11] - Independent directors are required to conduct annual self-assessments of their independence and report findings to the board [3][10] Group 3: Responsibilities and Rights - Independent directors are tasked with participating in board decisions, supervising potential conflicts of interest, and providing professional advice to enhance decision-making [17][18] - They have the right to independently hire external consultants for audits or investigations [17][18] - The company must provide necessary resources and support to enable independent directors to fulfill their duties effectively [19][20]

Core Viewpoint - The recent issuance of the "Opinions on Improving the Modern Enterprise System with Chinese Characteristics" emphasizes the importance of the independent director system in listed companies, mandating a majority of independent directors on audit committees and the establishment of specialized meetings for independent directors [1][2]. Group 1: Importance of Independent Director System - The independent director system is a crucial component of the modern enterprise system with Chinese characteristics and a fundamental aspect of the capital market [2]. - The "Opinions" released in April 2023 require that the board of directors of listed companies establish an audit committee composed entirely of non-executive directors, with a majority being independent directors [2]. - The implementation of the "Independent Director New Regulations" by the CSRC in August 2023 clarifies the responsibilities and operational methods of independent directors [2]. Group 2: Role and Responsibilities of Independent Directors - Independent directors are expected to enhance their independence and professional expertise, providing objective and fair advice for corporate decision-making [3]. - There has been a notable increase in the participation of independent directors in significant corporate decisions and management activities, as well as a more effective supervisory role [3]. - Independent directors have begun to issue supervisory letters to urge companies to strengthen internal controls and improve the quality and completeness of information disclosure [3]. Group 3: Implementation and Support for Independent Directors - Companies must provide comprehensive support for independent directors to ensure they can access information timely and effectively supervise and participate in decision-making [3][4]. - The integration of the independent director system into corporate governance is essential for driving long-term value growth and gaining recognition in the capital market [4]. - There is an expectation for independent directors to prioritize the interests of listed companies and minority investors, actively exercising their independence and expertise [4].

Core Viewpoint - The article emphasizes the importance of improving corporate governance in Chinese listed companies as a foundation for high-quality economic development, highlighting the introduction of measures to enhance the modern enterprise system in China [1][2]. Group 1: Capital Market and Corporate Governance - The "Opinions" document outlines three key requirements for the capital market: introducing institutional investors with a holding ratio of over 5% as active shareholders, strictly implementing the independent director system, and improving information disclosure in corporate governance [2][3]. - The capital market plays a crucial role in enhancing corporate governance through strict regulation, transparency, and the influence of stock price fluctuations on company value, which encourages better governance practices [3]. Group 2: Active Shareholder Participation - The introduction of institutional investors as active shareholders is seen as a significant institutional innovation, aimed at addressing the long-standing issue of dominant shareholders potentially harming minority shareholders' interests [4]. - Institutional investors are expected to actively participate in corporate governance, exercising their voting and inquiry rights to optimize company strategies rather than merely acting as passive financial investors [4][5]. Group 3: Independent Director System - The "Opinions" propose strict enforcement of the independent director system, including the establishment of audit committees with a majority of independent directors and dedicated meetings for independent directors [6]. - To enhance the independence of directors, it is suggested to broaden the nomination scope for independent directors beyond the board's nomination committee, allowing shareholders with over 1% holdings to nominate candidates [6]. Group 4: Information Disclosure Improvement - The "Opinions" aim to enhance the information disclosure system in corporate governance, focusing on transparency and reducing information asymmetry by requiring detailed disclosures of related transactions and significant risks [7]. - Improved information disclosure is expected to empower investors, particularly minority shareholders, to make informed judgments about company value and reduce the potential for opaque operations [7].