Composition of the Board of Directors
1.Composition of the Board of Directors
The Board is composed of 11 to 15 directors.
The Chairman of the Board has the following powers:
1.To preside over the shareholders' general meeting and to convene and preside over meetings of the board of directors;
2.To co-ordinate and perform the responsibilities of the board of directors and ensure that resolutions passed by the board are implemented;
3.To sign certificates of stocks, securities and other marketable securities issued by the Company;
4.To sign important board and other documents that need to be signed by a legal representative of the Company;
5.To exercise the power of a legal representative;
6.To exercise special disposition right in accordance with laws, regulations and corporate interests while force majeure as devastating disaster take place, and then report to the Board of Directors and Shareholders’ Meeting;
7.To exercise other powers granted by the Board of Directors.
Vice Chairman is authorized to exercise the acting power while Chairman fails to implement the above-mentioned powers.
2.Terms, Nominations, Election, and Removal
Directors are elected at the shareholders' general meeting for three-year terms. Terms are renewable upon re-election. Independent directors are restricted to a maximum of six years.
Candidates for non-independent directors are nominated by Sinopec's board of directors, the supervisory committee, or shareholders who hold 5% or more of the Company's voting shares.
In addition to the above groups, shareholders who individually or jointly own 1% or more of the Company's voting shares can nominate candidates for independent directors.
Sinopec uses accumulative voting to elect its board members.
Board members may be removed before the expiration of their term of office by an ordinary resolution passed at a shareholders' meeting. If a director misses two consecutive board meetings (three for independent directors) without appointing a proxy to attend on his behalf, the board will propose in a shareholders' general meeting that the director be removed and replaced.
Except for the above, and in circumstances outlined in PRC Company Law, no independent director may be removed before his term expires. In the case of early removal, the Company will disclose this fact and the independent director can make an open declaration if he/she believes the removal was improper.
The opinions of independent non-executive directors shall be clearly listed in the resolutions of the board.
People in following situations are not permitted to be the Independent Director:
1.Corporate and affiliates employees and their direct relationship or major social relations. (Direct relationship includes spouse, parents, children, etc. Major social relations include brothers and sisters, spouse’s parents, son-in-law and daughter-in-law, spouse of brothers or sisters, brothers or sisters of spouse, etc.);
2.Holding at least 1% corporate issued stocks directly or indirectly, or natural person shareholder in top 10 corporate shareholders and their direct relatives;
3.Working in shareholding companies with at least 5% corporate issued stocks directly or indirectly, or people working in the top 5 shareholding companies and their direct relatives;
4.In the above three circumstances in recent one year;
5.Working in the companies that provide financing, law or consulting services to the corporate or its affiliates;
6.Being independent director concurrently in 5 listed companies;
7.Others listed by securities regulatory organizations under the State Council.
Independent directors have special functions and powers as listed below. Sinopec will disclose when these powers are not adequately exercised. Except were noted, a simple majority of independent directors is needed for the following:
1.Approve and sign any resolution regarding material connected transactions made by the board. Independent directors can determine if an independent financial report is necessary, and engage an intermediary, before making a judgment;
2.To propose to the board of directors to engage or remove an accounting firm;
3.Propose the board of directors convene an EGM (two or more independent directors needed);
4.Propose the calling of a board meeting;
5.To independently engage an external auditor or advisor;
6.Collect voting rights from shareholders prior to convening a general shareholders meeting;
7.Directly report to shareholders' general meetings, securities regulatory organizations under the State Council and other relevant departments;