Chapter 1 General Principles
Article 1
To further improve the compensation management system of Tianshan Materials Co., Ltd. (hereinafter referred to as "the Company"), establish and enhance modern corporate incentive and restraint mechanisms, effectively motivate the work enthusiasm of the Company's directors and senior management, and further standardize the compensation distribution for directors and senior management, highlighting the performance-oriented role of compensation, this system is formulated in accordance with the "Company Law of the People's Republic of China," "Guidelines for the Governance of Listed Companies," and the "Articles of Association of Tianshan Materials Co., Ltd." (hereinafter referred to as "the Articles of Association"), as well as relevant laws, regulations, and normative documents, combined with the actual situation of the Company.
Chapter 2 Scope of Application
Article 2
This system applies to the Company's directors and senior management, specifically including the following personnel:
- Directors include internal directors, external directors, and independent directors. Internal directors refer to non-independent directors who are employees of the Company and receive compensation (including employee directors); external directors refer to non-independent directors who are not employees of the Company and do not hold any position other than director; independent directors refer to non-company employees appointed according to the "Management Measures for Independent Directors of Listed Companies," who have no relationships that may hinder independent and objective judgment with the Company and major shareholders or actual controllers.
- Senior management refers to the president, executive vice president, vice presidents, financial director, board secretary, and other senior management personnel as stipulated in the Articles of Association, appointed by the board of directors.
Chapter 3 Management Mechanism
Article 3
The compensation management for directors and senior management adheres to the following principles:
- Market-oriented principle. Regulate the compensation management of the Company's directors and senior management according to modern corporate management system requirements, promote market benchmarking, facilitate corporate reform and development, and strengthen the responsibilities of directors and senior management.
- Unity of incentive and restraint principle. Establish a compensation mechanism linked to performance evaluation results, matching risk and responsibility, adhering to the principle that "performance increases, compensation increases; performance decreases, compensation decreases," fully motivating directors and senior management.
- Overall consideration principle. Form a reasonable income distribution relationship between the Company's directors, senior management, and employees, adhering to the combination of short-term and long-term goals, unifying result assessment and process evaluation, and coordinating organizational and individual performance.
- Legal compliance principle. Strictly implement the management requirements for the compensation and benefits of directors and senior management, improve supporting systems, and comprehensively standardize the compensation and benefits of directors and senior management.
- Fairness, justice, and transparency principle. Compensation standards consider job value and responsibility difficulty, with clear assessment standards, scientific methods, standardized decision-making procedures, fair distribution results, and disclosure of compensation and assessment information as required.
Article 4
The compensation plan for directors is determined by the shareholders' meeting and disclosed. The compensation plan for senior management is approved by the board of directors, explained to the shareholders' meeting, and fully disclosed.