news

한어Русский языкEnglishFrançaisIndonesianSanskrit日本語DeutschPortuguêsΕλληνικάespañolItalianoSuomalainenLatina

On July 15 and July 16, Haixiang Pharmaceutical and Huatong Shares respectively issued announcements on changes in board secretaries. Among them, Wang Xiaoyang, the former board secretary of Haixiang Pharmaceutical, was replaced by Yao Bing on an interim basis, and Wang Zhilong replaced Zhu Wanzhen as the board secretary of Huatong Shares.

As for the reason for the change, Haixiang Pharmaceutical stated in the announcement that Wang Xiaoyang resigned from the positions of director, deputy general manager and secretary of the board of directors for personal reasons, and stated that he performed his duties diligently and conscientiously during his tenure. In contrast, Huatong's announcement of the change was a bit "heartless". In the announcement, Huatong did not explain the reason for the change, and did not even mention the name of the predecessor Zhu Wanzhen. It only stated that the company's chairman nominated and agreed to appoint Wang Zhilong as the company's secretary of the board of directors, and the final vote was passed with a unanimous "yes".

It is understood that the resignation of directors' secretaries in the A-share market is becoming more and more common, and has attracted close attention from investors. Data shows that as of December 22 last year, there were 5,330 A-share listed companies, and 944 of them had changes in directors' secretaries.

In the first half of the year, 35 listed companies in Zhejiang Province replaced their secretaries

The secretary of the board of directors is a legal senior executive of a listed company. Article 123 of the Company Law clearly stipulates that the secretary of the board of directors is responsible for the preparation of the company's shareholders' meeting and board of directors meeting, the safekeeping of documents, the management of the company's shareholder information, and the handling of information disclosure matters.

The duties of the secretary to the board of directors make him or her a vital figure in the capital market. If there are problems such as untimely and inaccurate information disclosure during the change process, it will not only affect the stock price but may even directly cause a short-term blow to the company's strategic planning.

Despite this, many listed companies still replaced their board secretaries in the first half of this year. Focusing on local areas, 35 A-share listed companies in Zhejiang replaced their board secretaries in the first half of this year, 7 fewer than the 42 in the same period of 2023. Among them, Hangzhou had the most, with 11; Ningbo was second with 6; Jiaxing, Jinhua, Shaoxing, and Taizhou had 3 each; Huzhou, Quzhou, and Wenzhou had 2 each.

It is worth noting that in the same period of 2023, the top two cities were also Hangzhou and Ningbo.

Based on the overall replacement of secretaries of A-share listed companies in 2023 and the replacement of secretaries of Zhejiang listed companies in the first half of this year, Lanfu Finance Network found that the frequency of replacement of secretaries of listed companies in first- and second-tier cities and cities with high urbanization rates is higher, while the frequency of replacement of secretaries of local enterprises, especially in cities with a large number of family businesses, is lower.

In addition, in the first half of 2024, the top three industries with the most replacements of secretaries of the board among Zhejiang A-share listed companies were power equipment, basic chemicals, and mechanical equipment, accounting for 17%, 14%, and 9%, respectively.

Analysts from well-known securities companies believe that companies with frequent changes in the board of directors' secretaries may have problems such as unstable governance structure, irregular internal management, and unclear corporate strategic planning. Projected to the industry, this to a certain extent indicates that competition in the industry has intensified and market demand has declined. If multiple companies in a certain industry have frequent changes in the board of directors' secretaries, it may bring a negative image to the entire industry and affect the industry's overall reputation and attractiveness.

It is worth noting that the current trend of secretaries to the board of directors is getting younger. According to data from Tonghuashun, as of March 2023, there were 218 A-share companies with secretaries to the board of directors who were born after 1990.

Under great pressure, we must always be cautious in what we say and do

Apart from those secretaries who leave due to the expiration of their normal term, the replacement of secretaries of listed companies always triggers various speculations from the outside world and is full of gossip, but the real reasons behind it are rarely known.

The reasons for official announcements are roughly six: expiration of term, work adjustments, personal reasons, changes in company needs, regulatory requirements, and changes in other senior executives’ concurrent positions.

Among them, the expiration of terms, job adjustments, and changes in company needs are relatively open and transparent, while personal reasons, regulatory requirements, and changes in other senior executives' concurrent positions give people a sense of story and conversation.

At the end of last year, a piece of news titled "Simei Media's secretary was suspended for riding on the TikTok hype" spread across the Internet.

Because the then-Secretary of the Board Li Zimu made a major mistake in answering investors' questions, Douyin officials came out to refute the rumor. The China Securities Regulatory Commission filed a case, and the share price of Simei Media once fell to the limit. After that, the company dismissed Li Zimu and he no longer holds any other position in the company.

It can be seen that being cautious in words and deeds is a compulsory course for the secretary to the board of directors.

For the secretary to the board of directors, the work is heavy and requires him to deal with a large amount of information disclosure, investor relations management, etc. Only he himself knows how it feels.

A blogger on Zhihu who is suspected to be a senior secretary to the board of directors answered online, "Typos in the announcement", "The actual controller spoke nonsense", "Weird questions from investors"... Every day, they have to deal with AI bugs, investors' difficulties, and frequently receive warning letters, as well as the mistakes and boasting made by their boss in public from time to time.

It has to be admitted that the position of secretary to the board of directors requires the practitioner to be versatile and good at networking, and to have a clever mind and the ability to keep an eye on all directions and listen to all sides.

This has also led to some secretaries to resign due to health problems or inability to withstand work pressure.