Annual Report 2021

ENVIRONMENTAL, SOCIAL AND GOVERNANCE REPORT (CONTINUED) China Merchants China Direct Investments Limited Annual Report 2021 84 SOCIAL RESPONSIBILITY (CONTINUED) Responsible Investment (continued) Despite we have minimal control over the business and operation decisions of the investee companies, we still pay close attention to their ability to fulfil ESG responsibility. Whenever suitable, we will attend their general meetings to obtain a better understanding of their ESG policy and performance. When they fall short, we may raise questions in the meeting regarding their ESG performance. Besides, we request investee companies to disclose significant non- compliance ESG issues in a timely basis and monitor news outlet for any ESG non-conformity. Due Diligence Process The Company and the Investment Manager actively put quality assurance into practice. Comprehensive due diligence review, business prospects analysis and ESG risk assessments are conducted by the Investment Manager before taking investment targets into consideration and adding them to the Company’s portfolio. By doing so, it is believed that the investment quality is assured and values are brought to our investors and shareholders. Intellectual Property Rights Protection Although the Company does not have products or services provided to stakeholders, all intellectual property right infringement is not allowed, including but not limited to the download and usage of pirated software, the use of intellectual property without the owners’ consent. Anti-corruption Commitments are made by the Company and the Investment Manager to maintain the highest level of integrity and accountability as instructed by the anti-bribery and anti-corruption guidelines. All Directors of the Company and all Directors and staff of the Investment Manager are expected to act on the highest ethical, personal and professional standard. The Investment Manager strongly encourages its employees to report any business irregularities and misconducts. Whistle-blowing channels and procedures are provided for the purpose of such reporting. Hence, employees, with anonymous identity, can raise concerns without the fear of retaliation. Any form of retaliation against the whistle-blower is prohibited. Number of concluded legal cases regarding corrupt practices brought against the Company or CMCIM and its employees during the Reporting Period and the outcomes of the cases: Number of concluded legal cases regarding corrupt practices 2021 2020 Brought against the Company and CMCIM 0 0 Brought against CMCIM’s employees 0 0 The Board is responsible for monitoring the effectiveness of the whistle-blowing procedures for the Company’s and the Investment Manager’s stakeholders. The procedures are reviewed and updated as and when required. The Board is also responsible for ensuring a proper independent investigation being conducted regarding the matters and there are proper follow-up actions.