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Item Implementation Status Difference from Corporate Governance Practice Principles for TWSE/GTSM-Listed Companies and reasons
Yes No Description
1. Does the Company set and disclose corporate governance code of practice according to corporate governance practice principles for TWSE/GTSM-Listed companies? (1) The Company has set a corporate governance code of practice, for the protection of shareholders’ rights, to strengthen the functions of the BOD, respect the interests of stakeholders, enhance the transparency of information and relevant rules. Detailed information can be found on the Company’s website. No Difference
2. Equity structure and shareholder rights No Difference
(1) Has the Company set internal operating procedures to deal with shareholder proposals, doubts, disputes and litigation matters, and does it implement these in accordance with its procedures? (1) The Investor Relations Department is dedicated to processing shareholder proposals or disputes.
(2) Does the Company have a list of those who ultimately control the major shareholders of the Company? (2) The Company has a list of major shareholders and who ultimately controls them and discloses this information pursuant to the laws.
(3) How does the Company establish its risk management mechanism and firewalls involving related enterprises? (3) The Company has established appropriate internal risk control mechanisms and firewalls, pursuant to the rules for specific companies or groups related business operations and financial transactions, supervision measures for subsidiaries, rules of endorsement and guarantee, loans to others and guidelines for acquisition or disposition of assets. Business relations between affiliated enterprises have been evaluated by an independent third party to prevent violations of unlawful transactions.
(4) Has the Company set internal standards to prohibit the use of undisclosed insider information to trade securities on the market? (4) The Company has set operating procedures and critical control points to prevent insider trading.
3. Organization and responsibilities of the Board of Directors No Difference
(1) Does the Board of Directors set and implement a diversification policy? (1) The company follows Article 20 in Corporate Governance Principles to ensure boards’ diversity. The company’s BOD has adopted nomination system. The members of the BOD are diversified and possess different professional backgrounds and experience of management practices in order to build the whole structure of the Company’s Board of Directors.(Please refer to page 15 for board members’ professons and independence)
(2) Has the Company establish other functional committees besides the Compensation Committee and Audit Committee? (2) The Company set up two independent directors and a Compensation Committee, has also set up the FGSC Committee, Energy-saving Technology Development Committee, Employee Benefits Committee and Employee Retirement Reserves Oversight Committee; other functional committees will be set up depending on future needs.
(3) Has the Company set performance assessment rules and methods for the BOD and does it perform this evaluation every year? (3) The Company set the policies through the Compensation Committee to regularly review the performance evaluations of directors and managers, as well as the compensation policies, systems, standards and structures, and the recommendations are submitted to the BOD for discussion.
(4) Does regularly evaluate the independence of the CPA? (4) The Company regularly assesses the performance and independence of the CPA through the BOD. The recommended CPA is required to provide CVs and declarations (not in violation of Ethical Standards Publication No. 10) for the BOD to discuss the appointment and independence of the CPAs.
4. Does the Company establish communication channels and dedicate section for stakeholder on its website to respond to important issues of corporate social responsibility concerns? The Company has set “Stakeholder Zone” and have the contact information for stakeholders to on its website to respond to major concerns regarding coporate social responsibilities from stakeholders. No Difference
5. Has the company appointed a professional stock affairs agency for shareholders affairs? The Company authorized “Fubon Securities Co., Ltd.” as stock service agency to handle shareholder transactions. No Difference
6. Disclosure of information No Difference
(1) Does the Company set up website to disclose financial operations and corporate governance information? (1) The Company has placed financial and corporate governance information of each year on its website.
(2) Has the Company adopted other measures (such as English website, a designated person responsible for the collection and disclosure of information, implementation of the spokesman system, the legal entities announcements uploaded to website, etc.) to disclose information? (2) The Company has an English website and a spokesperson, investor relations department and shareholder services department to disclose relevant information. The Company issued global depository receipts (GDR) in London, and discloses company information on its website according to the provisions of the relevant rules of the London Stock Exchange.
7. Does the Company have other important information for better understanding the Company’s corporate governance system (including but not limited to interests and rights of employees, care for employees, relation with investors, relation with suppliers, relation with interested parties, continuing education of directors and supervisors, execution of risk management policies and risk measuring standards, execution of customer policies, liability insurance for the Company’s directors and supervisors)?" (1)Interests and rights of employees: The Company has always treated employees in good faith to ensure their legal interests and rights in accordance with the Labor Standards Act. No Difference
(2)Care for employees: by adopting a welfare system and good education and training, a relationship of mutual trust has been established with employees. Such as: employee benefits and community cultural and recreational activities and entertainment, health clinic grants and medical advice, the Company also provides staff quarters, rented accommodations for staff, accommodation care, parking lots, etc.
(3) Investor Relations: the Investor Relations Department was set up to specifically deal with shareholder proposals.
(4)Supplier Relationship: good relations with suppliers are maintained at all times.
(5)Relations with stakeholders: stakeholders shall communicate with the Company and put forward proposals to protect their due legal rights and interests.
(6)Continuing education of directors and supervisors: the Company’s directors are qualified with industrial professional knowledge and practice experience in operation management. Please refer to the following table for more information on continuing education (please refer to the table below for specific case studies).
(7)Execution of risk management policy and risk measuring standards: various internal regulations are established legally for various risk management and evaluation.
(8)Execution of customer policies: stable and good relations with customers are maintained with the view of creating profits.
(9)Liability insurance for the Company’s directors and supervisors: liability insurance has been covered for directors and supervisors.
8. Does the Company have a corporate governance self-assessment report done by the Company itself or outsourced to professional agencies? (If yes, please state the Board’s views, the self-evaluation or outsourced assessment result, the main issues and shortcomings and recommendations for improvement.) The Company completed the self-assessment in accordance with the Taiwan Stock Exchange Corporation first-time evaluation of corporate governance, the evaluation results were announced on April 8, 2016. No Difference