Risk management
In order to improve corporate governance, implement risk management for business operations, and carry out risk management for uncertainties that may threaten the Company’s operations, the Company’s Sustainability Committee and Board of Directors approved the “Risk Management Policy and Procedures” in August 2023, which mainly include risk management policies and culture, risk management organization structure and responsibilities, risk management processes, risk information disclosure, and risk management aspects in order to effectively control the risks generated from business activities, and to report to the Sustainability Committee and the Board of Directors at least once a year on the status of the operation of risk management in the current year.
Risk management performance in 2024
The Sustainability Executive Office meets regularly each year to communicate risk information with each operating department, collect and organize risk management reports from each operating department, and report to the Sustainability Committee and the Board of Directors on the implementation of risk management for each risk.
The last report to the Board of Director was made on October 31, 2024.
Implementation (Oct 1, 2023 – Sep 30, 2024))
The table below shows the five risk factors prior to the results of the risk assessment conducted in 2024:
| Item | Risk Factor | Operational Status | |||
| Annual Execution Description | Current Measures | New Measures | Objective | ||
| 1 | Compliance/contract risks | Compliance audits conducted by responsible units (Legal, Finance, HR, etc.), based on relevant laws and company policies. |
|
Record violations and establish internal control improvement mechanisms | Reduce risks of contract non-compliance and legal exposure |
| 2 | Product functionality not meeting regulations or customer demands | Address functional compliance; increase attention to potential risks | Communicate with customers to clarify usage requirements | Confirm requirement specs and strengthen reviews to avoid recurrence | Ensure customer satisfaction and demand compliance |
| 3 | Brand/reputation damage | No major incidents from Q3 2023 to Aug 2024 | Monitor product and service quality to prevent disputes | Comply with RBA standards, require major vendors to sign ESG commitment | Meet customer ESG requirements and international sustainability standards |
| 4 | Rapid technology shifts | Track technological trends; note industry transitions | Collaborate with supply chain and synchronize design specs | Strengthen response planning for product iteration | Maintain product competitiveness and minimize risks from obsolescence |
| 5 | Major domestic/international policy changes (e.g., trade protectionism) | No major impact from Q3 2023 to Aug 2024 | Follow global policies, tax, environmental regulations; plan for changes | Strengthen Taiwan regulation tracking and compliance assessment | Reduce impacts of regulatory changes and policy risks |
| 6 | Interest rate / Exchange rate / Inflation | Manage interest and exchange rate risks; adjust strategies for stability | Monitor global financial market trends; hedge as needed | Maintain stable operations with flexibility to respond | Reduce financial volatility and improve resilience |
