Ethical Corporate Management
The Company has set up the Administration Department as a dedicated unit to promote the integrity management, which is responsible for formulating and monitoring the implementation of integrity management policies and preventive plans, and reporting to the Board of Directors on a regular basis.
The Board of Directors and the management of the Company will actively implement the commitment made in the Integrity Management Policy and will actually execute it in the internal management and business activities.
The Company’s “Code of Conduct for Integrity” has been approved by the Board of Directors for implementation, and submitted to the shareholders’ meeting. The same procedure is applicable to any amendments thereto.
Code of Conduct for Integrity
Article 1: Purpose and Scope of Application
The Code is hereby formulated with a view to establishing a corporate culture of integrity management and healthy development at the Company and its subsidiaries. The provisions under this Code shall apply to the Company and its subsidiaries as well as any enterprises or legal persons controlled by the Company, either directly or indirectly. Such entities and legal persons shall also formulate their respective Code of Integrity Management based on this Code.
Article 2: Policies
Upholding the business philosophies of integrity, transparency, and accountability, the Company shall formulate policies based on integrity, and establish good corporate governance and risk control mechanisms to create a business environment for sustainable development.
Article 3: Compliance with Laws and Regulations
The Company shall comply with the Company Act, the Securities and Exchange Act, the Business Entity Accounting Act, the Political Donations Act, the Anti-Corruption Statute, the Government Procurement Act, the Act on Recusal of Public Servants Due to Conflicts of Interest, TWSE/GTSM listing rules, or other laws or regulations regarding commercial activities, as the underlying basic premise to implement integrity management.
Article 4: Prevention Programs
The Company shall clearly and thoroughly prescribe the specific integrity management practices and the programs to prevent unethical conduct (hereinafter, the “prevention programs”), including operational procedures, conduct guidelines, and education and training programs. The Company shall formulate its Prevention Programs according to the related laws and regulations of the place where the Company and its business groups are operating. In the course of developing the Prevention Programs, the Company is advised to communicate with its employees, labor unions, and important business counterparties or other stakeholders.
Article 5: Scope of Prevention Programs
When making its Prevention Measures, the Company shall analyze the business activities within their business scope at a higher risk of being involved in unethical conduct, and strengthen related preventive measures accordingly. The above paragraph covers the preventive measures against the following behaviors:
- Offering and accepting bribes.
- Offering illegal political contributions.
- Improper charitable donations or sponsorships.
- Offering or acceptance of unreasonable presents or hospitality, or other improper benefits.
- Infringement of trade secrets, trademark rights, patent rights, copyrights, and other intellectual property rights.
- Engaging in unfair competitive practices.
- The rights or interests, health, and safety of consumers or other stakeholders are damaged directly or indirectly in the course of research and development, procurement, production, and provision or sale of products and services.
Article 6: Prohibition of Dishonest Behaviors
No director, managerial officer, employee, appointee or those with substantial control over the Company (hereinafter referred to as the “Substantial Controller) shall, in the course of business, either directly or indirectly, offer, promise, request or accept any improper benefits, or conduct any other dishonest behaviors in breach of good faith, law or fiduciary duty to obtain or maintain a benefit (hereinafter referred to as Unethical Conduct). The counterparties mentioned in the preceding paragraph include public servants, candidates for political offices, political parties or party officers, as well as any public or private enterprises or organizations and their directors, supervisors, managerial officers, employees, substantial controllers, or other stakeholders.
Article 7: Form of Interests
The benefits indicated herein refer to anything of value, including cash, gifts, commissions, positions, services, preferential treatments, and rebates in any form or name. However, those belonging to normal social etiquette and customs and being occasional without the risk of affecting specific rights and obligations are excluded.
Article 8: Commitment and Implementation
The Company shall expressly describe the policies regarding integrity management in its rules and external documents, and the Board of Directors and the management shall actively implement the commitment made in the Integrity Management Policy and will actually execute it in the internal management and business activities.
Article 9: Integrity Management of Business Activities
The Company shall engage in commercial activities in a fair and transparent manner based on the principle of integrity management. Prior to any commercial transactions, the Company shall consider the legality of its agents, suppliers, clients, or other trading counterparties and whether any of them are involved in unethical conduct, and shall avoid any dealings with persons so involved. When entering into the contract with its agents, suppliers, clients or other trading counterparties, the Company shall include in such contracts terms requiring compliance with the integrity management and in the event the trading counterparties are involved in unethical conduct, the Company may at any time terminate or rescind the contracts.
Article 10： Prohibition of Offering and Accepting bribes
When conducting business, The Company and its directors, managerial officers, employees, appointees and substantial controllers shall not, directly or indirectly, offer, promise to offer, request, or accept any improper benefits in whatever form from any clients, agents, contractors, suppliers, public servants or other stakeholders.
Article 11: Prohibition of Offering Illegal Political Contributions
Direct or indirect donations made by the Company and its directors, managerial officers, employees, appointees and substantial controllers to the political parties or organizations or individuals participating in the political activities shall conform to the Political Contribution Act and the Company’s internal procedures, and shall not seek for business benefit or transaction advantages.
Article 12: Prohibition of Improper Charitable Donations or Sponsorships
When making or offering donations or sponsorship, the Company and its directors, managerial officers, employees, appointees and substantial controllers shall comply with relevant laws and regulations and internal operational procedures, and shall not engage in bribery in disguise.
Article 13. Prohibition of Offering or Acceptance of Unreasonable Presents or Hospitality, or Other Improper Benefits
The Company and its directors, managerial officers, employees, appointees and substantial controllers shall not directly or indirectly offer or accept any unreasonable presents, hospitality or other improper benefits for the purpose of establishing business relationships or affect business transitions.
Article 14: Prohibition of Infringing Intellectual Properties
The Company and its directors, managerial officers, employees, appointees and substantial controllers shall comply with the applicable laws, regulations and the Company’s internal procedures related to intellectual properties, and shall not use, disclose, dispose of, damage intellectual property or otherwise infringe any intellectual property rights without the prior consent of the intellectual property rights holder.
Article 15: Prohibition of Unfair Competition
The Company shall engage in business activities in accordance with applicable competition laws and regulations, and shall not fix prices, make rigged bids, establish output restrictions or quotas, or share or divide markets by allocating customers, suppliers, territories, or lines of commerce.
Article 16: Preventing Products or Services from Damaging Stakeholders
The Company and its directors, managerial officers, employees, appointees, and substantial controllers shall comply with relevant regulations and international standards in the process of research and development, procurement, manufacturing, provision, or sale of products and services to ensure information transparency and safety of products and services, as well as formulating and disclosing the rights and interests protection policy of consumers or other stakeholders, while implementing it in its operating activities, to prevent products or services from damaging the rights, health and safety of consumers or other stakeholders either directly or indirectly. Where there are sufficient facts to determine that the products or services are likely to pose any hazard to the safety and health of consumers or other stakeholders, the Company shall, in principle, recall those products or suspend the services immediately.
Article 17: Organization and Obligations
The directors, managerial officials, employees, appointees, and substantial controllers of the Company shall exercise their duty of care as good stewards to urge the Company to prevent unethical conduct, always review the results of the preventive measures and continually make adjustments so as to ensure thorough implementation of its integrity management policies. To improve the integrity management, the Company shall establish a dedicated unit to formulate and monitor the implementation of integrity management policies and prevention plans.
Article 18: Law Compliance of Operations
The Company’s directors, managerial officers, employees, appointees, and substantial controllers shall conduct their business in accordance with the laws and the prevention plans when conducting business.
Article 19: Avoiding Conflicts of Interest
The Company shall adopt policies for preventing conflicts of interest to identify, monitor, and manage risks possibly resulting from unethical conduct, and shall also offer appropriate means for directors, managerial officers, and other stakeholders attending or present the Board of Directors’ meetings to voluntarily explain whether their interests would potentially conflict with those of the Company. If the proposal to be discussed at the Board meeting involves a conflict of interest with the Company’s directors, managerial officers and other stakeholders who are present or attend the Board meeting or the legal entities represented by them, they shall disclose the important contents of the conflict of interests at the Board meeting, and shall refrain from discussion or vote on the relevant proposals nor shall exercise the right to vote for other directors if there is likelihood of impairment to the Company’s interest. The directors shall be self-disciplined and shall not support each other improperly.
No director, managerial officer, employee, appointee or substantial controller of the Company shall, by taking advantage of his or her position or influence in the Company, improperly benefit himself or herself, his or her spouses, parents or children or any other persons.
Article 20: Accounting and Internal Control
The Company shall establish an effective accounting system and internal control system for business activities with a higher risk of dishonest behaviors, shall not set up off-the-book accounts or private ledgers, and shall review the systems from time to time to ensure that the design and implementation of the systems remain continuously effective. The Company’s internal audit division shall periodically review the compliance with the preceding systems and prepare an audit report to the Board of Directors. It may appoint an accountant to perform the review and, if necessary, appoint a professional to assist the review.
Article 21: Education, Training and Examination
The Chairman, president or senior management of the Company shall communicate the importance of integrity to directors, employees and appointees on a regular basis. The Company shall regularly provide education and training programs to its directors, managerial officers, employees, appointees and substantial controllers so that they can be fully aware of the Company’s determination, policies, prevention plans and consequences of committing unethical conduct. The Company shall integrate its integrity management policy with employee performance examination and HR policies and establish a clear and effective reward and punishment system.
Article 22: Whistle-blowing System
The Company shall adopt a specific whistle-blowing system and shall actually implement it to cover the following matters:
- To set up and announce an internal independent whistle-blowing e-mail or hotline, or to authorize other external independent organizations to provide an e-mail or hotline for internal and external personnel of the Company to report the relevant cases.
- To assign a dedicated person or unit responsible for handling the whistle-blowing system. Any tip involving a director or a senior executive shall be submitted to the independent directors. Categories of reported misconduct shall be delineated and standard operating procedures for the investigation of each shall be adopted.
- To document case acceptance, investigation processes, investigation results, and relevant documents.
- To keep the identities of whistle-blowers and the contents of the reported matters confidential.
- The measures to protect the reporters from improper treatment due to the reported matters.
- Incentive measures for whistle-blowing.
When material misconduct or likelihood of material impairment to the Company comes to its awareness upon investigation, the dedicated personnel or unit handling the whistle-blowing matters shall immediately prepare a report and notify the independent directors in written form.
Article 23: Disciplinary and Appeal System
The Company shall adopt and announce a well-defined disciplinary and appeal system for handling violations of the integrity management rules, and shall immediately disclose on the Company’s intranet site the title and name of the violator, the date and content of the violation, and the actions taken in response.
Article 24: Information Disclosure
The Company shall disclose the measures taken for implementing the integrity management, the status of implementation, and it’s Code of Conduct for Integrity on the Market Observation Post System (MOPS).
Article 25: Review and Amendment of Integrity Management Policies and Measures
The Company shall, at all times, monitor the development of relevant local and international regulations concerning integrity management and encourage its directors, managerial officers, and employees to make suggestions based on which the adopted integrity management policy and measures taken shall be reviewed and improved with a view to achieving better implementation of integrity management.
Article 26: Implementation
The “Code of Conduct for Integrity” has been approved by the Board of Directors for implementation, and submitted to the shareholders’ meeting. The same procedure shall be followed when it is amended.
When the Company submits this Code to the Board of Directors for discussion in accordance with the preceding paragraph, the Board of Directors shall take into full consideration each independent director’s opinions. Any objections or reservations of any independent director shall be recorded in the minutes of the Board of Directors meeting. If an independent director is unable to attend a board meeting in person to express his or her objection or reservation, he or she shall, unless there is a legitimate reason to do otherwise, provide a written opinion in advance, which shall be included in the minutes of the Board of Directors meeting.