Board Composition

The Company has a Board of Directors with a diverse range of professional backgrounds, ranging from various industries and academia, with experience in running world-class companies, including three female directors.

In order to achieve the objectives of corporate governance, the main tasks of the Board of Directors of the Company are as follows:

• ．Review the Company's business plan
• ．Develop an effective and proper internal control system pursuant to Article 14-1 of the Securities and Exchange Act
• ．Review the Company's financial objectives and results (including annual financial reports and semi-annual financial reports; offering, issuance, or private placement of any equity-type securities; adoption or amendment of handling procedures for financial or operational actions of material significance, such as acquisition or disposal of assets, derivatives trading, extension of monetary loans to others, or endorsements or guarantees for others as stipulated in Article 36-1 of the Securities and Exchange Act)
• ．Select and supervise managers (appointment or discharge of a financial, accounting, or internal auditing officer)
• ．Oversee and manage the risks faced by the Company
• ．Ensure that the Company complies with the relevant regulations (Article 14-3 of the Securities and Exchange Act, other matters that are required by law or the Articles of Incorporation to be resolved by the shareholders' meeting or by the Board of Directors, or matters of significance stipulated by the competent authorities)
• ．Map out the future direction of the Company
• ．Build and maintain the Company's image
• ．Fulfill social responsibilities (including donations to related parties or significant donations to unrelated parties)
• ．Appoint an accountant

Succession Plan and Operation of Board Members

The company continues to implement a director succession plan and has established a database of potential candidates based on the following criteria. The selection process for the director candidate list is subject to qualification review and regulations to ensure the effective appointment of suitable new directors when vacancies arise or when there is a plan to increase board seats.

1.Integrity, responsibility, innovation, and decisiveness, aligning with the core values of the company, possessing professional knowledge and skills beneficial to the company's management.

2.Relevant industry experience related to the company's business operations.

3.The addition of board members should contribute to maintaining a diverse, gender-equal, and board that meets the company's needs.

4.The company has also established a "Board Performance Evaluation Method" to assess various aspects of performance, including participation in company operations, quality of board decisions, board composition and structure, director selection and continuous education, internal controls, etc. This ensures the proper functioning of the board and evaluates director performance as a reference for future appointments.

All board members of the company have relevant professional backgrounds and practical management experience. They undergo at least 6 hours of related courses annually, and details of such professional development can be found on the Taiwan Stock Exchange's public information platform.

The company has completed the performance evaluation of the Board of Directors for the fiscal year 2023. The evaluation results have been submitted and approved by the 8th session of the 18th Board of Directors. The overall average score for the Board of Directors' performance evaluation is 4.98 out of 5, indicating excellent overall board operation. The individual director's performance evaluation results have an overall average score of 4.96 out of 5, demonstrating strong individual contributions. The Audit Committee received an overall average score of 5 out of 5 in the evaluation. The Compensation Committee received an overall average score of 5 out of 5, and the ESG Committee received an overall average score of 5 out of 5 as well. Both committees achieved 100% satisfaction in all assessed categories.

In order to further strengthen corporate governance, the board of directors approved the revision of the "Board of Directors Performance Evaluation Method" on 112/12, and the revision shall be evaluated by an external professional independent agency or a team of external experts and scholars at least every three years.

On 113/5, the company commissioned an external independent evaluation agency, the China Corporate Governance Association, to conduct a performance evaluation of the company's board of directors. The external professional evaluation institution is an independent evaluation institution that has no business dealings with the company. The evaluation method includes online self-evaluation and on-site interviews with interviewers, and is evaluated in eight aspects including the composition of the board of directors, guidance, authorization, supervision, communication, internal control, risk management and board of directors self-discipline. The performance evaluation report of the board of directors was issued on 113/6/17, and the evaluation results were reported to the board of directors.

The conclusion of the evaluation report states that the company attaches great importance to the professionalism and diversity of the composition of the board of directors, and the current number of independent directors and female directors has exceeded the current legal norms. The corporate governance evaluation ranking results have also improved year by year, and the board of directors' efforts in improving corporate governance deserve recognition. The company attaches great importance to sustainability-related issues and has obtained third-party verification of its sustainability report. The company's board of directors attaches great importance to the value of employees to the company, and reserves high-level talents through Carnegie High-Performance Manager Courses, succession coaching, job rotation, etc., and systematically and clearly lays out and plans the succession plan for the senior management. Lay the foundation for the company's sustainable development. Based on the recommendations of the evaluation report, the company revised the division of powers and responsibilities for risk management and revised the board of directors' performance evaluation questionnaire.

Policy on Diversity of Board Members

The Company's Board of Directors approved the “Corporate Governance Best Practice Principles” on March 10, 2015, which sets out the diversity policy in Chapter 3, "Strengthening the Functions of the Board." The nomination and selection of the members of the Board of Directors of the Company is based on a candidate nomination system in accordance with the provisions of the Articles of Incorporation and adheres to the “Procedures for Election of Directors” and the “Corporate Governance Best Practice Principles.” The Company has set a target of 25% female directors to ensure diversity in the Board of Directors, after taking into account its business model and development needs.

The seven directors of the board all have diverse backgrounds, including different industries, financial accounting and other backgrounds. The proportion of the Company's directors who are employees is 28.57% and the proportion of independent directors is 71.42%, and there is no spouse or relative within the second degree of relationship among the directors, so the company's board of directors is independent. In addition, the company also pays attention to gender equality in the composition of the board of directors. Among them, there are 3 female directors, and the ratio has reached 42.85%.

The diversification, complementarity and implementation of the company’s directors have included the standards set out in Article 20 of the “Corporate Governance Code of Practice”; in the future, the diversification policy will be updated in a timely manner depending on the board’s operation, operation model and development needs, including but not The standards are limited to two aspects: basic conditions and values, professional knowledge and skills, so as to ensure that members of the board of directors should generally have the knowledge, skills and accomplishments necessary to perform their duties. The implementation of the board diversity policy is as follows: