Annual Report 2011 - Goodbaby International Holdings Limited

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The Board is pleased to present this corporate governance report in the annual report for the year ended 31 December 2011. The manner in which the principles and code provisions in the Code on Corporate Governance Practices (the “CG Code”) contained in Appendix 14 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) (the “Listing Rules”) are applied and implemented is explained in the following sections of this corporate governance report: CORPORATE GOVERNANCE PRACTICES The Group is committed to achieving high standards of corporate governance to safeguard the interests of shareholders and to enhance corporate value and accountability. The Company has applied the principles as set out in the CG Code contained in Appendix 14 of the Listing Rules. Throughout the year from 1 January 2011 to 31 December 2011, in the opinion of the Directors, the Company has complied with all the code provisions and certain recommended best practices as set out in the CG Code, save for the deviation from code provision A.2.1, which deviation is explained in the relevant paragraph of this report. The Company has also put in place certain recommended best practices as set out in the CG Code. gb international The Company reviews its corporate governance practices regularly to ensure compliance with the CG Code. The Company is committed to enhancing its corporate governance practices appropriate to the conduct and growth of its business and to review such practices from time to time to ensure that they comply with the CG Code and align with the latest developments. THE BOARD RESPONSIBILITIES The Board is responsible for leadership and control of the Company and oversees the Group’s businesses, strategic decisions and performance. The Board has delegated to the chief executive officer, and through him, to the senior management the authority and responsibility for the day-to-day management and operation of the Group. In addition, the Board has established Board committees and has delegated to these Board committees various responsibilities as set out in their respective terms of reference. All directors shall ensure that they carry out duties in good faith, in compliance with applicable laws and regulations, and in the interests of the Company and its shareholders at all times. The Company has arranged for appropriate insurance cover for directors’ and officers’ liabilities in respect of legal actions against its directors and senior management arising out of corporate activities.
BOARD COMPOSITION The Board currently comprises seven members, consisting of two executive Directors, two nonexecutive Directors and three independent nonexecutive Directors. The Company has adopted the recommended best practice under the CG Code for the Board to have at least one-third of its membership comprising independent non-executive Directors. The list of all Directors, which also specifies the posts, e.g. of chairman and chief executive officer, and chairman and member of committee(s), held by each Director are set out under “Corporate Information” on page 3 to 5. The independent non-executive Directors are expressly identified in all corporate communications pursuant to the Listing Rules. The biographical details of the Directors are disclosed under the section headed “Directors and Senior Management” in this annual report. The Board comprises the following Directors: Executive Directors: Mr. SONG Zhenghuan Mr. WANG Haiye Non-executive Directors: Mr. Christopher Marcus GRADEL Ms. CHIANG Yun Independent non-executive Directors: Mr. Iain Ferguson BRUCE Mr. LONG Yongtu Mr. SHI Xiaoguang None of the members of the Board is related to one another, save and except that Mr. WANG Haiye, executive Director, vice president and chief operating officer, is the nephew of Mr. SONG Zhenghuan, the chairman, chief executive officer and executive Director of the Company. / 41 Throughout the year from 1 January 2011 to 31 December 2011, the Board at all times met the requirements of the Listing Rules relating to the appointment of at least three independent nonexecutive Directors with at least one independent non-executive Director possessing appropriate professional qualifications or accounting or related financial management expertise. The Company has received written annual confirmation from each independent nonexecutive Director of his independence pursuant to the requirements of the Listing Rules. The Company considers all independent nonexecutive Directors to be independent in accordance with the independence guidelines as set out in the Listing Rules. The non-executive Directors bring a wide range of business and financial expertise, experience and independent judgement to the Board. Through active participation at Board meetings, taking the lead in managing issues involving potential conflict of interests and serving on Board committees, all non-executive Directors make various contributions to the effective direction of the Company. CHAIRMAN AND CHIEF EXECUTIVE OFFICER Code provision A.2.1 stipulates that the roles of chairman and chief executive officer should be separate and should not be performed by the same individual. Mr. SONG Zhenghuan is an executive Director, the chairman of the Company, chief executive officer and the founder of the Group. The Board considers that vesting the roles of the chairman of the Company and chief executive officer in the same person is necessary because of the importance of Mr. Song in the business
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Page 4 and 5: CORPORATE INFORMATION gb internatio
Page 6 and 7: CORPORATE INFORMATION DIRECTORS Exe
Page 9 and 10: 7 Chairman’s Statement
Page 11 and 12: Dear Shareholders, I wish to presen
Page 13: Looking forward, the Group will con
Page 16: OVERVIEW For the financial year end
Page 19 and 20: ) Our OBM model was systematically
Page 21 and 22: FINANCIAL REVIEW — CONTINUING OPE
Page 23 and 24: Cost of Sales, Gross Profit and Gro
Page 25 and 26: Income Tax Expense Our income tax e
Page 27: Pledge of Assets As at 31 December
Page 40 and 41: gb international
Page 44 and 45: development efforts of the Company
Page 46 and 47: Specific enquiry has been made of a
Page 48 and 49: The key elements of the Group’s i
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Page 52: The Directors are pleased to presen
Page 55 and 56: pursuant to which each of the Coven
Page 57 and 58: Directors’ Interest in the Shares
Page 61 and 62: During the year under review, the t
Page 63 and 64: DISCLOSURE UNDER RULE 13.20 OF THE
Page 65 and 66: INDEPENDENT AUDITORS’ REPORT We b
Page 67 and 68: CONSOLIDATED STATEMENT OF COMPREHEN
Page 69 and 70: CONSOLIDATED STATEMENT OF FINANCIAL
Page 71 and 72: CONSOLIDATED STATEMENT OF CASH FLOW
Page 73 and 74: STATEMENT OF FINANCIAL POSITION 31
Page 75 and 76: NOTES TO FINANCIAL STATEMENTS 31 De
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NOTES TO FINANCIAL STATEMENTS 31 De
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FINANCIAL SUMMARY ASSETS, LIABILITI
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Annual Report 2011 - Goodbaby International Holdings Limited

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