Ethical Corporate Management Principles
Article 1 ．Purpose of Enactment, Applicable Scope and Applicable Persons
The Company, in accordance with “Corporate Governance Best Practice Principles for TWSE/TPE x Listed Companies”, enacts and executes “The Ethical Corporate Management Best Practice Principles” ("Principles") to establish a corporate culture of ethical management.
The Principles shall apply to the Company's subsidiaries, and other institutions or juridical persons which are substantially controlled by the Company.
The Principles shall apply to the Company's Directors, Supervisors, managers, employees, mandatories of the Company or persons having substantial control over the Company (collectively “The Applicable Persons”).
Article 2．Prohibition of Unethical Conduct
When engaging in commercial activities, The Applicable Persons shall not directly or indirectly offer, promise to offer, request or accept any improper Benefits, nor commit unethical acts including breach of the principle of good faith, illegal acts, or breach of fiduciary duty (collectively "Unethical Conduct") for purposes of acquiring or maintaining Benefits.
The opposite parties of the Unethical Conduct referred to in the preceding paragraph include civil servants, political candidates, political parties or their members, state-run or private-owned businesses or institutions and their Directors, Supervisors, managers, employees or persons having substantial control over the Company (“Substantial Controllers”) or other stakeholders.
Article 3．The Types of Benefits
The "Benefits" mentioned in the Principles means any items of value, including money, endowments, commissions, positions, services, preferential treatment or rebates of any type or in any name. Benefits received or given occasionally in accordance with accepted social customs and that do not adversely affect specific rights and obligations shall be excluded.
Article 4．Legal Compliance
The Company shall comply with the Company Act, Securities and Exchange Act, Business Entity Accounting Act, Political Donations Act, Anti-Corruption Act, Government Procurement Act, Act on Recusal of Public Servants Due to Conflict of Interest, TWSE/GTSM-listing related rules, or other laws or regulations regarding commercial activities, as the underlying basic premise to facilitate ethical corporate management.
Subject to the operation principles of integrity, transparency, and responsibility, the Company enacts and executes “The Ethical Corporate Management Principles which approved by Board of Directors to establish a corporate culture of ethical management and sound development, and offer a framework to establish good commercial practices, risk management mechanism, and to create a sustainable business environment.
Article 6．Prevention Program
The Company have setting Corporate Social Responsibility Policy Management Procedure (AK0024) clearly prescribe ethical corporate management principles. The Ethic Norms of this procedure including the operation and prevention to unethical conduct, which comply with relevant laws and regulations of the territory where the Company are operating.
Article 7．Scope of Prevention Program
The company shall establish evaluation mechanism to risk of Unethical Conduct, regularly analyze and evaluate the business activities have higher risk of Unethical Conduct in business scope, as a reference of setting prevention plan, and regularly review appropriateness and effectiveness of the plan.
The company may deliberate national or international common standards, guidelines to set prevention plan covers the following actions:
2. Provide illegal political contributions.
3. Improper charitable donations or sponsorship.
4. Provide or accept irrational stolen goods, entertainment or other improper benefits.
5. Infringement of business secrets, trademark rights, patents, copyrights and other intellectual property rights.
6. Conduct unfair competition
Article 8．The Commitment and Execution
Directors and executives of the Company shall declare the compliance to Ethical Corporate Management Policy, and also require following the policy as employment terms of employees.
The Board of Directors and executives promises to rigorously and thoroughly enforce ethical management for internal management and external commercial activities.
The company shall well document the policy, declaration, commitment, and the execution to Ethical Corporate Management.
Article 9．Engaging in Commercial Activities under Ethical Corporate Management Policies
The Company, based on the principle of ethical management, shall engage in commercial activities in a fair and transparent manner.
Prior to the conclusion of any commercial transaction, the Company shall take into consideration the legality of their agents, suppliers, clients or other trading counterparties, and whether they have conducted Unethical Conduct before, if any, and avoid having any dealings with persons who have or have been involved with any record of Unethical Conduct.
When entering into contracts with other parties, the Company shall include in such contracts provisions demanding ethical corporate management policy compliance and a provision that in the event the trading counterparties are suspected of engaging in or involved with Unethical Conduct, the Company may at any time terminate or cancel the contracts.
Article 10．Prohibition of Offering and Accepting Bribes
When conducting business, The Applicable Persons shall not directly or indirectly offer, promise to offer, request or accept any improper Benefits in any form to or from clients, agents, contractors, suppliers, public servants, or other stakeholders.
If The Applicable Persons are offered or promised bribery or bribery because of threats or intimidation, they shall record the process and report to supervisor.
The Company shall immediately handle the notices mentioned in the preceding paragraph and review the relevant circumstances so as to reduce the risk of recurrence. If it is found to be involved in wrongdoing, the Company shall immediately notify the judicial unit.
Article 11．Prohibition of Offering Illegal Political Donations
When directly or indirectly offering a donation to political parties or organizations or individuals participating in political activities, The Applicable Persons shall comply with the Political Donations Act and its own relevant internal operational procedures, and shall not make such donations in exchange for commercial gains or business advantages.
Article 12．Prohibition of Improper Charitable Donations or Sponsorship
When making or offering donations and sponsorship, the Company and The Applicable Persons shall comply with relevant laws and regulations and internal operational procedures, and shall not engage in bribery.
Article 13．Prohibition of Unjustifiable Presents, Hospitality or Other Improper Benefits
The Company and The Applicable Persons shall not directly or indirectly offer or accept any unjustifiable presents, hospitality or other improper benefits to establish business relationship or influence commercial transactions.
Article 14．Prohibition of Intellectual Property Infringement
The Company and The Applicable Persons shall comply with the laws, regulations, internal process procedures, and applicable contracts pertaining to intellectual property. The Company shall not use, disclose, dispose, destroy, or make any other infringement to intellectual property without prior written consent of the owners of the intellectual property rights.
Article 15．Prohibition of Unfair Competition
The Company shall follow the applicable competition laws and regulations when engaging in business activities, 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．Organization and Responsibility
The Applicable Persons shall exercise due care in urging the Company to prevent Unethical Conduct, and review, from time to time, the results of the preventive measures and continually make adjustments.
To achieve sound ethical corporate management, the Company shall appoint responsible organization with adequate and capable staff to be in charge of enactment to ethical management policy, setting/monitoring prevention to Unethical Conduct. Responsible organization shall report to Board of Directors on a regular basis, at least once a year.
Article 17．Legal Compliance for Conducting Business
The Applicable Persons shall comply with the laws, regulations and the internal principles when conducting business.
Article 18．Avoiding Conflicts of Interest
The Company shall establish regulations for preventing conflicts of interest, to distinguish, supervise, and manage the potential risks of Unethical Conduct resulting from conflict interests, and offer appropriate means for Directors, Supervisors, managers, and any other stakeholders attending or present at the board meeting to voluntarily explain whether their interests would potentially conflict with those of the Company.
A director, Supervisors, manager, and any other stakeholder attending or present at the board meeting, or the juristic person represented thereby, has a stake in a proposal at the meeting, shall state the important aspects of the stake in the meeting. Such person shall be prohibited from discussing and participating in voting on any proposals if there is likelihood that the interests of this Company would be prejudiced, shall recuse himself or herself from any discussion and voting, and shall not exercise voting rights as proxy on behalf of another director. The Directors shall exercise self-discipline and should not support one another in improper ways.
The Applicable Persons shall not take advantage of their positions or influence in the Company to obtain improper Benefits for themselves, their spouses, parents, children or any other person.
Article 19．Accounting and Internal Control
The Company shall establish effective accounting and internal control systems for business activities which may be at a higher risk of being involved in Unethical Conduct, and should not have under-the-table accounts or maintain secret accounts, and shall conduct reviews from time to time so as to ensure that the design and enforcement of the systems continue to be effective.
The internal audit department of the Company shall set audit plans based on evaluation results to the Unethical Conduct. The plan shall include auditee, scope, item, and frequency, etc., and audit the compliance of prevention plan accordingly. The Company may assign accountants to perform the audit, and may request assistance from other professionals if required.
The fore mentioned audit result shall be submitted to executives and appointed responsible organization, the audit result shall also be reported to Board of Directors.
Article 20．Training and Reviews
The company shall from time to time organize education, training and advocacy for The Applicable Persons, and invite the counterparties who engaged in business activities with the company to fully understand the company's determination in the company's integrity management, policies, defense plans, and the consequences of committing Unethical Conduct.
Article 21．Whistleblowing, Punishment and Appeals Process
The company shall develop and publish the disciplinary and grievance system that violates the integrity management requirements, and provide a proper prosecution pipeline. The identity of the prosecutor and the content of the prosecution shall be kept confidential.
After the investigation of grievance is completed, follow-up measures should be taken according to the severity of the situation. If necessary, report to in charge authorities or Judicial office for legal investigation may be processed.
Article 22．Disclosure of Information
The Company shall disclose the status of the enforcement of the Principles on its company website, annual report and public prospectus.
Article 23．Review and Amendment to the Principles
The Company shall monitor the development of relevant local and international regulations concerning ethical corporate management from time to time, and encourage its Directors, Supervisors, managers and employees to make suggestions so as to review and improve the Principles and achieve better results from implementation.
The Ethical Corporate Management Best Practice Principles, and any amendments to them, shall be implemented upon approval by the Board of Directors.
The Company has been established in accordance with the provisions of the Act, when the Principles is submitted to Board Meeting for discussion pursuant to the preceding paragraph, the opinions from each Independent Directors shall be discussed thoroughly, and being recorded together with assertions in the meeting minutes. If the Independent Director cannot attend the Board Meeting in person to voice his or her dissenting or qualified opinion, unless there are justifiable reasons for failure to do so, he or she should provide a written opinion before the Board Meeting, and the opinion shall be noted in the minutes of the Board Meeting.
If the Company has set up Audit Committee, regulations in the Principles in relation to Supervisors shall apply to Audit Committee.
The Principles is resolved on Dec 17, 2015.