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Performance Evaluation of the Board and Functional Committees |
(1)Internal Performance Evaluation
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The "Board Performance Evaluation Measures" were approved by the Board of Directors on October 29, 2019. They stipulate that performance evaluations will be conducted annually for the "Board of Directors," "Board Members," "Audit Committee," "Compensation Committee," "Corporate Governance and Nomination Committee," and "Sustainability and Risk Management Committee." The evaluation results are categorized into three levels: Exceeding Standards, Meeting Standards, and Needs Improvement.
The self-evaluation results of the company's "Board of directors", "Audit committee", "Remuneration committee", "Corporate governance and nomination committee" and "Sustainability and risk management committee" in 2024 are all above the standard, and there are no major improvement items. The evaluation results has been reviewed at the first Board meeting in 2025 the board of directors reports to the directors and serves as a reference for the performance, remuneration and nomination for renewal of members of the board of directors and functional committees.
(2)External Performance Evaluation
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The performance evaluation of the company's board of directors will be conducted at least once every three years by an external professional independent organization or a team of external experts and scholars. In 2024, the company commissioned the "Taiwan Corporate Governance Association" to conduct an external board effectiveness assessment. This assessment will evaluate five major dimensions: the composition and division of labor of the board of directors, the guidance and supervision provided by the board, the authorization and risk management by the board, the communication and collaboration within the board, and the self-discipline and continuous improvement of the board. The assessment results will be reported to the board of directors on February 13, 2025.
Reasons why external agencies and evaluation committees are independent:
The Taiwan Corporate Governance Association is neither a related party to the company nor engaged in any business relationship that could affect its independence. The evaluation participants and their second-degree relatives do not hold positions of significant influence in the company, nor do they have direct or indirect financial interests in the company or receive any gifts from it.
The evaluation and recommendations issued by the Taiwan Corporate Governance Association (TCGA):
The Taiwan Corporate governance Association (TCGA) has no business dealings with the company and maintains its independence. According to its evaluation report, four of the company's directors are independent directors, accounting for half of the total board seats, while female directors make up one-third of the board. All directors are professionals with extensive experience in business management. The chairman of the board respects the diverse expertise of the directors, fostering an open atmosphere during board meetings. Additionally, the board conducts a pre-meeting one day prior to the official board meeting for the exchange of opinions, effectively exercising its leadership function. The company holds semi-annual strategy meetings where the management team reports to and exchanges insights with board members. These meetings focus on the company's mid- to long-term goals and development strategies, covering topics such as capacity planning, equity investments, technology development, and ESG-related issues. Additionally, board members are invited to external conferences arranged by the company, fostering in-depth interaction and discussions on the company's short-, medium-, and long-term sustainability goals. This enhances the board's role in strategic guidance. The performance evaluation criteria for senior managers (including the CEO) are set based on the company's long-term development strategy, incorporating financial and ESG performance indicators, with the establishment of clawback provisions. This effectively incentivizes the team to pursue the company’s long-term interests, laying the foundation for sustainable development. In 2021, an external professional independent organization was commissioned for the first time to conduct a performance evaluation of the board of directors. The evaluation results were reported to the board, and improvement plans have been developed and gradually implemented in response to the recommendations from the previous external evaluation.
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