(1)Internal Performance Evaluation 

The Company's Board of Directors has approved the "Methods to Evaluate Performance of the Board of Directors" on October 29, 2017. The Company executes the performance evaluation once a year. The members of the Board of Directors and functional committees and the responsible departments for Board of Directors meetings has processed internal performance evaluation on the “Board of Directors”, ”Director members”, “Audit Committee”, “Remuneration Committee” and “Corporate Governance and Nomination Committee”. The assessment results will be classified into three levels: Exceeding Expectations, Meets Expectations, and Room for Improvement.

In 2023, the self-evaluation results of the “Board of Directors”, “Audit Committee”, “Remuneration Committee” and “Corporate Governance and Nomination Committee” were rated as "Exceeding Expectations" and no material improvement items were found. The evaluation results will submit to the Board of Directors in the first Board meeting in 2024 and will be as a reference for members of the Board of Directors and functional committees on their performance, compensation and nomination renewal.

(2)External performance evaluation

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. The next external evaluation is expected to be scheduled for the fourth quarter of 2027, with the results to be reported to the board in the first quarter of 2028.

Reasons why external agencies and evaluation committees are independent:

The committee members and responsible personnel from the Taiwan Corporate Governance Association conducting the performance evaluation of the company's board of directors adhere to principles of fairness, objectivity, and integrity, without any circumstances that could influence their independence. They have all signed a confidentiality agreement and a declaration of independence and integrity principles.

The recommendations from the Taiwan Corporate Governance Association (TCGA):

1. In the organizational structure chart disclosed in the company's annual report, a "Chief Compliance Counsel for Antitrust Laws" is established under the Audit Committee to respond to the needs arising from past phased tasks. However, given the increasingly diverse and complex legal environment faced by the company's operations today, it is recommended that your company consider changing this title to one that more appropriately reflects the current compliance functions.
2. The company has established a stakeholder section and an Audit Committee email on its website. However, the current disclosed location is relatively difficult to find. It is recommended that your company review and enhance the visibility of this information to enable stakeholders to quickly and comprehensively understand relevant information, thereby improving the transparency of the company’s information.

Please click here to view the external conclusion assessment statement from the Taiwan Corporate Governance Association.

(1)Director's remuneration

The remuneration of the directors of the Company shall be paid by the Board of Directors in accordance with the provisions of the Regulations Governing the Remuneration of Directors and Members of Functional Committees, which are formulated in accordance with the authorization of the Articles of Incorporation, based on the participation and value of contribution by the directors to the operation of the Company, and with reference to the standards of domestic and foreign industry.

The remuneration of the directors shall be increased in accordance with the chairman, convener and members of the functional committees, and may be reduced at their discretion in accordance with the results of operational performance or performance evaluation by the directors.

According to the Articles of Incorporation, if the company makes profit for the year, no less than 5% should be set aside as employee remuneration. However, when the company still has accumulated losses, provision should be made in advance for the deficit.

Starting from 2024, the director’s remuneration will be reported annually to the shareholders’ meeting including of remuneration policy, personal remuneration and amount.

(2)Manager's remuneration

Manager's remuneration policy

The remuneration of the managers of the Company shall be paid in accordance with the principle of "Remuneration Policy of Managers" determined by the Remuneration Committee and the Board of Directors, and shall be reviewed by the Remuneration Committee on an annual basis and submitted to the Board of Directors for resolution. The Company has also cooperated with external professional consultants for a long time to ensure that managers' remuneration policies, payment levels and market fluctuations are linked. The remuneration of our company's manager is linked to the company's operational performance. The overall reward composition consists of salary, short and long-term variable bonuses, and profit-sharing employee bonuses. Among these, variable bonuses are determined based on operational performance, accounting for 70% to 90% of the total remuneration depending on position and performance. At the same time, the managers' long-term reward plan is assessed over a three-year period, with stock rewards accounting for more than 50%, and includes clawback provisions. The Remuneration Committee sets performance goals in line with the company's long-term development strategy. In addition to financial indicators such as EBITDA, revenue, gross profit margin, and operating profit margin of strategic products, and contribution to shareholders, it also incorporates ESG sustainability performance and major theme management goals, combining the three major axes of "environmental sustainability", "inclusive growth", and "agile innovation". centered around “environmental sustainability”, “inclusive growth”, and “flexible innovation”, deepening the connection with shareholder interests and fulfilling our commitment to sustainable management.

Executive Stock Ownership Guidelines

Part of the manager's remuneration is paid in the form of stock, and the Board of Directors had formulated the "Executive Stock Ownership Guidelines" on 23. Feb, 2023, after reviewed and revised on March 11, 2024, which requires executives to own company shares in an amount equal to a multiple of their annual base salary: ten multiples for the chairman, CEO, and president; and five multiples for other executives. The executives are required to achieve the shareholding target within five years of appointment or from the policy effective date, and maintain the value of the above shareholding during the term of the executive, so as to strengthen corporate governance and reduce management risks.