China Coal Energy Group Co., Ltd. (hereinafter referred to as China Coal Group) focuses on enhancing core functions and enhancing core competitiveness, focusing on deepening institutional and mechanism reform tasks, and continuously enhancing the vitality and motivation to develop new quality productivity, so as to further deepen reform and accelerate high-quality development, continuously improve the quality of enterprises' business, and maintain a good level of operating performance, laying a solid foundation for building a world-class energy enterprise.

Fully implement the "two consistent" and strengthen the construction of modern enterprise system with Chinese characteristics

First, dynamically optimize the list of rights and responsibilities of enterprises at all levels. We will continue to integrate the Party’s leadership into all aspects of corporate governance, dynamically improve the “four matter list” (the list of three decision-making matters of the Party Committee, the Board of Directors, and the General Office of the Party Committee and the “Pre-in List of Matters”), and simultaneously integrate it into the power allocation manual to form a “multiple and single table.” "One-on-one" guides affiliated enterprises to dynamically improve the "pre-item list" and collective research and control list, regularly conduct comprehensive self-inspection and evaluation of the quality and implementation of the list, and promote the connection and operation standards of the decision-making procedures of various governance entities. Taking the opportunity of building an intelligent production and operation management platform, we will incorporate the pre-research on the party committees of each second-level enterprise into the system management and control, strengthen real-time supervision of the operability of the "pre-research list", the standardization of the negotiation process of each governance subject, and the smoothness of the operation connection, and effectively quantitatively evaluate the quality of the pre-research on the party committees of the enterprise. The second is to strengthen the top-level design of the board of directors of subsidiaries. Establish a daily management mechanism for the board of directors, and all 82 subsidiaries within the scope of construction shall be established to ensure that all the board of directors shall be established, and the majority shall be implemented by external directors. An evaluation method for the board of directors and directors is issued, and a comprehensive evaluation of the board of directors and external directors of the affiliated enterprises will be conducted every year. Enterprises will conduct on-site investigations and inspections on board construction for each household. In response to problems found, the "one enterprise, one letter" feedback work reminder letter will be sent. The third is to strengthen the standardized management and support for external directors to perform their duties. Broaden the source of external directors, select and appoint external directors from key subsidiaries, universities, industry associations and other units, and continuously improve the full-time external director talent pool. Relying on the board of directors' comprehensive management information system, we will continue to build a dual platform of "group performance guidance + sub-enterprise performance guarantee" to realize the online operation of the board of directors of sub-enterprises and the daily work of full-time directors performing their duties. Regularly hold special promotion meetings to organize professional examinations for the secretary of the board of directors and the staff of the board of directors of all-level subsidiaries to promote learning and work through examinations.

Highlight wider and deeper coverage, and promote the improvement of term system and contractual management quality and expansion

First, strengthen the challenge of contract goals. Further improve the "high-level" mechanism, implement the target salary reform of the heads of the affiliated enterprises, highlight the value creation orientation, simplify the salary structure, cancel and merge more than 10 individual awards of various types, with an average floating salary accounting for more than 80%, which is rigidly linked to the enterprise assessment results, and differentiate the assessment indicators of different types of enterprises such as production and sales, scientific research and design, comprehensive services, and strategic cultivation, deepen the distribution concept of "giving first and getting good performance and good rewards", and achieve "I know my goals, and I make the decision on my salary." The second is to dynamically optimize the management mechanism. Continuously improve the contract template of the "Two Books and One Agreement", explore and promote the annual and term assessment of members of the party cadre team, and fully implement term system and contractual management of the management team of subsidiaries at all levels to achieve full coverage of their affiliated enterprises and personnel. Actively promote the expansion of term system and contractual management to managers at all levels, and implement business management responsibilities in a classified and layered manner. As of the end of September 2024, the contract ratio of 10 second-level enterprises' managers has reached 100%. The third is to strictly assess the rigid implementation. Further refine the classified assessment, build and improve the indicator system for "one enterprise, one policy", highlight different assessment priorities for enterprises of different functions and categories, reasonably set assessment weights, and determine differentiated assessment standards. The annual assessment is used as the "touchstone" to test the quality and efficiency of term system and contractual management. Strictly in accordance with the contract agreement, incentives for over-completion of the assessment or outstanding contributions will be in place, and resolutely adjust and withdraw the "Double 70" clause for failing the annual assessment, incompetent annual comprehensive evaluation, or triggering the "Double 70" clause will be effectively encouraged to take responsibility and action by the management.

Improve efficiency and enhance vitality, and further deepen market-oriented employment reform

First, continue to deepen the reform of headquarters institutions at all levels. Two rounds of group headquarters reform have been carried out. On the basis of implementing the large-term system and breaking the "department wall" in 2021, the headquarters departments, internal institutions, personnel establishment, and department head staffing are streamlined by 32%, 12%, 10% and 27% respectively, the "department wall" will be further demolished in 2023, the business project responsibility system will be implemented, and the "three-layer, eight-level, two-channel" rank system will be established to form a "four-yuan salary" structure. The headquarters departments will be streamlined to 13, and the personnel establishment and department head staff will be streamlined by 33% and 34% respectively. The reform of the second-level enterprise headquarters will be fully completed, the number of institutions, staffing and middle-level positions will be streamlined by 28%, 49% and 21%, respectively, and the reform of the third-level enterprise headquarters will be promoted simultaneously. The second is to promote the competitive position of managers, adjustments in the final and incompetent withdrawals, and inadequate exit. Establish a normalized competitive employment mechanism at the group headquarters and conduct regular competitive employment. The three systems of the affiliated enterprises have been formulated to evaluate the reform of the three systems of the affiliated enterprises. The final adjustment and incompetent exit system of managers at all levels will be fully covered. The performance appraisal results are used as an important basis for managers to advance, retreat, transfer, and remuneration and punishment. The proportion of managers to adjust and incompetent exit in 2023 will reach 8.97%. The third is to continuously improve the employee turnover and exit mechanism. In accordance with the requirements of "controlling total amount, adjusting structure, and improving quality", we will insist on reducing personnel without reducing capital and increasing personnel without increasing capital, deepen the full scope of labor costs, integrate labor fees and total wages, strictly control the number of labor dispatch and other employees, increase the cleaning and handling of non-working personnel, and make every effort to promote the reduction of personnel and efficiency improvement. In 2023, the proportion of public recruitment will continue to maintain 100%, and the market-oriented exit rate of employees will reach 2.5%.