Hangzhou Tongshifu Cultural and Creative (Group) Co., Ltd. released the Terms of Reference for its newly-formed Remuneration and Appraisal Committee, strengthening board-level oversight of pay and performance.

Key points:

1. Committee Structure • Three-member body led by an independent non-executive director; the majority of members must be independent. • Members are nominated by the board chair, a majority of independent directors, or at least one-third of all directors, and are elected by the board. • Tenure aligns with the directors’ own board terms, with automatic disqualification upon loss of board seat or independence.

2. Principal Responsibilities • Design and recommend overall remuneration policy, assessment criteria, and specific pay packages for directors and senior management. • Review and approve compensation proposals, severance terms, and any dismissal-related payments to ensure fairness and contractual compliance. • Conduct annual performance appraisals for executive directors and senior management and supervise implementation of the company’s remuneration system. • Oversee matters related to share schemes under Chapter 17 of the Hong Kong Listing Rules. • Ensure no individual participates in decisions on his or her own remuneration.

3. Meeting and Voting Rules • At least one meeting per year, with interim meetings possible on demand. • Quorum set at two-thirds of members; resolutions require a simple majority. • Related members must abstain from deliberations on connected matters. • Written minutes are required, and resolutions must be reported to the full board.

4. Disclosure and Resources • The committee’s terms of reference will be published on both the Hong Kong Stock Exchange and the company’s websites. • The company is obligated to provide adequate resources for the committee to obtain independent professional advice when necessary. • Annual reports will disclose directors’ remuneration policies and senior management pay bands in line with Hong Kong Listing Rules.

The terms of reference take effect upon the listing of Tongshifu’s H shares on the main board of the Hong Kong Stock Exchange, reflecting the company’s commitment to formalized, transparent, and independent governance of executive remuneration and performance evaluation.