Corporate Governance Operation

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Directors' principal experience (education) and positions now concurrently held in the Company and in other companies.

Title

Name

Principal education

Experience

Positions now held concurrently in the Company and in other companies

Director

Peter Chan

California State University Fullerton, Bachelor Degree

Entrepreneur Management Research Class, Department of Business Management, National Chengchi University

Director, Taisun Enterprise Co.,Ltd.

Director, Pin-Tai Distribution Enterprise Co., Ltd.

Chairman, Pioneer Traffic Co.Ltd.

Chairman of Taisun Enterprise Co., Ltd., Director of Pin-Tai Distribution Enterprise Co., Ltd., Chairman of Pioneer Traffic Co. Ltd., Chairman of Taisun Yuan Co., Ltd., Chairman of Taisun (Cayman) Investment Ltd. , Taisun Enterprise (Zhangzhou) Foods Co., Ltd. Supervisor, Chairman of Central Union Oil Corp., Ltd., Director of Taiwan FamilyMart Co., Ltd., Independent Director of GIGA-BYTE Technology Co., Ltd., Supervisor of Info-Tek Corporation, Chairman of Taiwan Vegetable Oil Manufacturers Association

Director

Fred Chan

Utah State University, Master Degree,

Bachelor of Chemical Engineering, Tamkang University,

Entrepreneur Management Research Class, Department of Business Management, National Chengchi University

Director, Taisun Enterprise Co.,Ltd.

Director, Pin-Tai Distribution Enterprise Co., Ltd.

Director, Pioneer Traffic Co.Ltd.

Director and General Manager of Taisun Enterprise Co., Ltd., Chairman of Pin-Tai Distribution Enterprise Co., Ltd., Director of Taiwan Niko Mart Co., Ltd., Director of Pioneer Traffic Co. Ltd., Director of Taisun Yuan Co., Ltd., Director of Taisun Enterprise (Zhangzhou) Foods Co., Ltd., Director of Central Union Oil Corp., Ltd., Director of Taiwan FamilyMart Co., Ltd., Director of CVS.Com Co., Ltd.

Director

Chan Hao-Jun

University of British Columbia, Canada, Bachelor Degree,

Supervisor, Taisun Enterprise Co.,Ltd.

Supervisor, Pin-Tai Distribution Enterprise Co., Ltd.

Supervisor, Pioneer Traffic Co.Ltd.

Director of Taisun Enterprise Co., Ltd., Supervisor of Pin-Tai Distribution Enterprise Co., Ltd., Supervisor of Pioneer Traffic Co. Ltd., Director of Taisun Yuan Co., Ltd., Chairman and General Manager of Taisun Enterprise (Zhangzhou) Foods Co., Ltd.

Director

Chan Pei-Shan

California State University, Long Beach Bachelor Degree

Supervisor, Taisun Enterprise Co.,Ltd.

Chairman, Dechen Enterprise Co., Ltd.

Director and Executive assistant, Taisun Enterprise Co.,Ltd.

Chairman, Dechen Enterprise Co., Ltd.

Independent Director

Wu Chieh-Hsin

Master of Business Administration, University of Manchester, Minnesota, USA; National Chengchi University Entrepreneur Management Research Class; Master of Advanced Management, School of Management, National Chiao Tung University, Master of Management, Graduate School of Management, National Taiwan University of Science and Technology

The 32nd Entrepreneurship Model of the Republic of China

Evaluation Committee Member of the Institute of Design, National Yunlin University of Science and Technology

Member of the Compensation Committee of GIGA-BYTE Technology Co., Ltd.

Independent Director and Member of the Compensation Committee, Taisun Enterprise Co., Ltd.

Chairman, Super Dragon Technology Co., Ltd.

Independent Director of Chyang Sheng Dyeing & Finishing Co., Ltd.

Independent Director

Sun Chu-Wei

Department of Accounting, Tamkang University, Bachelor Degree

Certified Public Accountant of the Republic of China

Qualification of Patent Attorney of the Republic of China

Teaching Assistant, Department of Accounting, Tamkang University.

Auditor, RSM International Taiwan.

Audit Dept. Deputy Chief, Deloitte & Touche Taiwan

Independent Director and Member of the Compensation Committee, Taisun Enterprise Co., Ltd.

Independent Director of Chyang Sheng Dyeing & Finishing Co., Ltd.

Independent Director of Min Aik Percision

Managing Partner of Bai-chi CPA Firm.

Member of the Public Relations Committee of CPA Associations R.O.C. (Taiwan)

Independent Director

Hsu Yung-Chang

Fu Jen Catholic University, Master Degree

Qualified as a lawyer in the Republic of China

Corporate Counsel, Yageo Corporation

Independent Director and Member of the Compensation Committee, Taisun Enterprise Co., Ltd.

Chairman Responsible Person of Yuan Hsin Law Firm

Directors’ professional qualifications and independence

December 31, 2021

      Condition

  Name

   (Note 1)

Have more than five years of work experience and the following professional qualifications

Meet conditions of independence (Note 2)

Number of independent directors concurrently serving in other public offering companies

Lecturers or above in public and private colleges and universities in relevant disciplines required for business, legal affairs, finance, accounting, or corporate business

Judges, prosecutors, lawyers, accountants or other professional and technical personnel who have passed the national examinations required for corporate business and have certificates

Work experience required for business, legal affairs, finance, accounting, or corporate business

1

2

3

4

5

6

7

8

9

10

11

12

Chairman

Representative of Shen Yang Investment Corporation Limited:

Peter Chan

 

 

V

 

 

V

V

V

V

V

V

V

V

V

 

1

Director

Representative of Jing Xun Investment Industrial Corporation Limited: Fred Chan

 

 

V

 

 

V

V

V

V

V

V

V

V

V

 

0

Director

Representative of Dechen Enterprise Co., Ltd.:

Chan Pei-Shan

 

 

V

 

V

V

V

V

V

V

V

V

V

V

 

0

Director

Chan Hao-Jun

 

 

V

 

 

V

V

V

V

V

V

V

V

V

V

0

Independent Director

Wu Chieh-Hsin

 

 

V

V

V

V

V

V

V

V

V

V

V

V

V

1

Independent Director

Sun Chu-Wei

 

V

V

V

V

V

V

V

V

V

V

V

V

V

V

2

Independent Director

Hsu Yung-Chang

 

V

V

V

V

V

V

V

V

V

V

V

V

V

V

0

Note: For directors and supervisors who meet the following conditions two years before their appointment and during their tenure, please type “ü” in the space below each condition code.

(1) Not an employee of the Company or its affiliates.

(2) Not a director or supervisor of the Company or its affiliates. (However, in the case of independent directors established and concurrently serving in the company and its parent company, subsidiary company or subsidiary company of the same parent company in accordance with this law or local laws, this limitation shall not apply.)

(3) Not a natural-person shareholder who holds shares, together with those held by the person’s spouse, minor children, or held by the person under others’ names, in an aggregate amount of one percent or more of the total number of outstanding shares of the Company or ranking in the top ten in holdings.

(4) Not a manager of those listed in (1), or someone having a relationship with those listed in (2) or (3) including a spousal relationship, a second-degree kinship or closer, or an immediate blood relative within three degrees of kinship.

(5) Not a director, supervisor, or employee of a corporate shareholder that directly holds five percent or more of the total number of outstanding shares of the Company or that holds shares ranking in the top five in holdings, or is designated as a representative in accordance with Article 27, Paragraph 1 or 2 of the Company Act. (However, in the case of independent directors established and concurrently serving in the company and its parent company, subsidiary company or subsidiary company of the same parent company in accordance with this law or local laws, this limitation shall not apply.)

(6) Not a director, supervisor, or employee of another company controlled by the same person with more than half of the shares with voting rights on the company’s board of directors. (However, in the case of independent directors established and concurrently serving in the company and its parent company, subsidiary company or subsidiary company of the same parent company in accordance with this law or local laws, this limitation shall not apply.)

(7) Not a director, supervisor, or employee of another company or institution whose chairman, general manager, or equivalent position is the same person as that of the Company, or the spouse thereof. (However, in the case of independent directors established and concurrently serving in the company and its parent company, subsidiary company or subsidiary company of the same parent company in accordance with this law or local laws, this limitation shall not apply.)

(8) Not a director, supervisor, or manager of a specific company or institution having financial or business dealings with the Company, or a shareholder holding 5% or more of shares.(However, if a specific company or institution holds more than 20% of the total issued shares of the company but not more than 50%, and the established independent director concurrently serves in the company and its parent company, subsidiary company or subsidiary company of the same parent company in accordance with this law or local laws, this limitation shall not apply.)

(9) Not an owner, partner, director, supervisor, manager, or spouse thereof of a company or institution that provides commercial, legal, financial, accounting services or consultation to the company or any affiliate of the Company for amounts exceeding NT$500,000 in the past two years. However, for members of the Compensation Committee, Public Acquisitions Review Committee, or M&A Special Committee who perform their functions and powers in accordance with the relevant laws and regulations of the Securities and Exchange Act or the Business Mergers & Acquisitions Act, this limitation shall not apply.

(10) No relationship with other directors falling within a spousal relationship or second degree of kinship.

(11) Not exhibiting any of the circumstances specified under Article 30 of the Company Act.

(12) No provision to be elected by a government or juristic person or their representative under Article 27 of the Company Act.

 

Information on the operation of the Board of Directors

The Board of Directors met 13 times during 2020 and up to the date of publication of the annual report (A). The attendance of directors and supervisors is as follows:

Term

Job title

Name (Note 1)

Actual number of seats (B)

Number of delegates attending

Actual attendance rate

(%) [B/A] (Note 2)

21st term

Chairman

Shen Yang Investment Corporation Limited

Representative: Peter Chan

13

0

100%

Director

Representative of Jing Xun Investment Industrial Corporation Limited: Fred Chan

13

0

100%

Director

Dechen Enterprise Co., Ltd.

Representative: Chan Pei-Shan

13

0

100%

Director

Chan Hao-Jun

13

0

100%

Independent Director

Wu Chieh-Hsin

13

0

100%

Independent Director

Sun Chu-Wei

13

0

100%

Independent Director

Hsu Yung-Chang

12

1

92%

Other matters to be recorded:

  1. If the operation of the Board of Directors falls into one of the circumstances, the date and duration of the meeting, details of proposals, the opinions of all independent directors and how the Company deals with such opinions:

(I) Matters listed in Article 14-3 of the Securities and Exchange Act: The Company established independent directors and established an audit committee on April 25, 2016. From 2021 to March 31, 2020, a total of nine board meetings were held to resolve the details of the matters shown on pages 58-60 of the annual report. All independent directors passed without objection the matters listed in Article 14-3 of the Securities and Exchange Act.

(II) In addition to the previous matters, other board meeting decisions that have been opposed or faced reservations by independent directors and have records or written statements: None.

  1. Recusal of the Directors from motions involving their private interest, specify the names of the Directors, the content of the motions, the reason for recusal, and the participation in voting:

(I) The 14th meeting of the 21st Board was held on 2020/05/11; for the motion of the distribution of remuneration to directors for 2019 recommended by the Compensation Committee.

  1. As the remuneration to directors involved a conflict of interest, the Chairman recused himself and the independent director Wu Chieh-Hsin acted as the chair. Regarding the remuneration of directors, the ordinary directors (Peter Chan, Fred Chan, Chan Pei-Shan, Chan Hao-Jun) who attended this time did not participate in the discussion or vote due to their interests. After the consultation of the Chairman, the motion was passed with no objection.
  2. Motion recommended by the Compensation Committee for the distribution of remuneration to the appointed managerial officers for 2019.

General Manager Fred Chan recused himself from discussion and voting due to a conflict of interest. After the consultation of the Chairman, the motion was passed with no objection.

(II) The 21st meeting of the 21st Board was held on 2020/01/27 for the motion of the year-end bonus to the appointed managerial officers for 2020.

Director Fred Chan recused himself from discussion and voting due to a conflict of interest. After the consultation of the Chairman, the motion was passed with no objection.

(III) The 23rd meeting of the 21st Board was held on 2020/03/25 for the motion of the distribution of remuneration to directors for 2020.

The discussion on the remuneration to directors involved a conflict of interest, and the independent director Wu Chieh-Hsin acted as the chair. Regarding the remuneration of ordinary directors, the ordinary directors (Peter Chan, Fred Chan, Chan Pei-Shan, Chan Hao-Jun) who attended this time did not participate in the discussion or vote due to their interests. After the consultation of the Chairman, the motion was passed with no objection.

III. TWSE / TPEx Listed Companies should disclose the evaluation cycle and period, assessment scope, method and evaluation content of the board’s self (or peer) evaluation, and the implementation of the Board of Directors evaluation, please refer to page 23 of the annual report.

  1. The objective for fortifying the function of the Board in the current year and the most recent year (e.g., setting up an audit committee, improving information transparency, etc.) and the assessment of the status of implementation:

(I) The Company established an audit committee on April 25, 2016.

(II) In 2020 and as of the printing date of the annual report, and in accordance with the Company Act, Article 14-3 of Securities and Exchange Act, Article 14-5, etc., the Company’s proposals shall be submitted to the audit committee for approval or the resolution of the Board of Directors. After the approval of the audit committee, it is sent to the Board of Directors for resolution and implementation. (It is not necessary to submit the proposal approved by the audit committee first, and then directly submit the resolution to the Board of Directors for implementation.)

(III) The Company cooperated with the competent authority to promote the new version of the corporate governance blueprint, and effectively performed the functions of the Board of Directors. On February 27, 2020, the 11th meeting of the 21st Board of Directors passed a resolution to formulate the Company’s “Board Performance Evaluation Methods”.

(IV) Passed by resolution of the Company’s 21st Board at the 14th board meeting held on May 11, 2020.

  1. Motion for the amendments to the Company’s Corporate Governance Practices in line with the law. 2. Motion for the amendments to the Company’s Corporate Social Responsibility Practices in line with the law.
  2. Motion for the amendments to the Company’s Code of Ethical Management in line with the law. 4. Motion for the implementation measures for the Company’s whistleblower system in line with the corporate governance blueprint policy of the competent authority.

(V) Passed by resolution of the Company’s 21st Board at the 20th board meeting held on December 24, 2020.

  1. A dedicated unit to promote the ethical management policy has been established and its affairs in relation to promotions are reported to the Board of Directors each year.
  2. Motion for the formulation of the Company’s “Procedures for Ethical Management and Guidelines for Conduct” in line with the law.
  3. Motion for the formulation of the Company’s “Procedures for the Prevention of Insider Trading” in line with the law.

    4. Motion for the amendments to the Company’s “Self-Evaluation or Peer Evaluation of the Board of Directors” in line with the law.

Directors' continuing education in 2020

Name

Date of education

Theme

Organizer

Certificate No.

Peter Chan

2020/7/3
3 hours

A View of Global Corporate Sustainability Development – From Vision 2050 to Action 2020

Taiwan Corporate Governance Association

TCGA10902206

2020/7/10
3 hours

[CGP-Advance] To Give or not to Give Information? Information Rights of Directors

Taiwan Corporate Governance Association

TCGA10902332

2020/8/14
3 hours

Director Responsibility and Risk Management under the Latest Corporate Governance Blueprint

The Securities and Futures Market Development Foundation of the Republic of China

(109) Zhengji Director/Supervisor Renewal No. 01807 N120740141

Fred Chan

2020/7/21
3 hours

How Independent Directors Master the Key Defenses of Financial Reporting Risk and Case Studies

Taiwan Independent Director Association

(109) Du-Dong-Jing-Zi No. A0721045

2020/8/12
3 hours

The Role of Independent Directors in the Battle between Corporate Governance and Management Rights

Taiwan Independent Director Association

(109) Du-Dong-Jing-Zi No. A0812036

Chan Hao-Jun

2020/6/1
6 hours

Common Deficiencies of Internal Audits in a Company, Legal Liability and Case Analysis

Accounting Research and Development Foundation of the Republic of China

(109) Huijiao (Ji) Zi No. 1027014

Chan Pei-Shan

2020/6/19
3 hours

Analysis of the Latest CSR Reporting Trends and Related Corporate Governance Practices

Accounting Research and Development Foundation of the Republic of China

(109) Huijiao (Gong) No. 1034011

2020/6/29
3 hours

Business Strategy and Corporate Governance in View of the World’s Unsustainable Risks from COVID-19

The Securities and Futures Market Development Foundation of the Republic of China

(109) Zhengji Director/Supervisor Renewal No. 00807 N220910583

Wu Chieh-Hsin

2020/7/22
3 hours

Corporate Governance and Sustainable Management Class

Taiwan Academy of Banking and Finance

(109) Jin-Zheng-Gong-Zhi-Zi No. 013032

2020/9/22
3 hours

“Corporate Governance 3.0 – A Blueprint for Sustainable Development” Summit

TWSE/TPEx

No certificate No.

Hsu Yung-Chang

2020/9/22
3 hours

“Corporate Governance 3.0 – A Blueprint for Sustainable Development” Summit

TWSE/TPEx

No certificate No.

2020/10/26
3 hours

Impact on the Rights and Obligations of Directors/Supervisors After the Amendments to the Latest Insurance Laws

The Securities and Futures Market Development Foundation of the Republic of China

(109) Zhengji Director/Supervisor Renewal No. 03242 E121650050

Sun Chu-Wei

2020/7/9
3 hours

Corporate Financial Statement Fraud Case Study

The Securities and Futures Market Development Foundation of the Republic of China

(109) Zhengji Director/Supervisor Renewal No. 00953 C120771316

2020/7/9
3 hours

The New Version of Corporate Governance and the Exercise of Powers by the Board of Directors and Matters to be Followed

The Securities and Futures Market Development Foundation of the Republic of China

(109) Zhengji Director/Supervisor Renewal No. 00973 C120771316

Major decisions of the Shareholders Meeting and the Board in the most recent year to the day this report was printed
  1. Important resolutions of the 2020 shareholders meeting:

Date

Meeting type

Important resolutions

Implementation status

2020/5/21

Annual General

Meeting

(1)    Acknowledged the motion for 2019 business report and financial statements.

(2)    Acknowledged the motion for 2019 profit distribution.

 

 

 

 

(3)    Acknowledged the motion for the change of the Company’s 2017 plan for issuing new shares by capital injuction.

(4)    Motion for passing the amendments to the Company’s Articles of Incorporation.

 

 

(5)    Motion for passing the amendments to the Company’s Rules of Procedure for Shareholders Meetings.

(6)    Motion for passing the amendments to the Company’s Methods for the Election of Directors.

(7)    Motion for passing the amendments to the Company’s Procedures of the Acquisition or Disposal of Assets.

(1)    Relevant forms have been submitted to the competent authority for inspection and announcement in accordance with Company Act and other relevant laws and regulations.

(2)    The Company’s net profit after tax in 2019 was NTD 582,073,235. According to the resolution of the shareholders meeting,

the dividend per share was NTD 0.9. The ex-dividend date was set on June 15, 2020, and the payment was fully completed on July 10, 2020.

(3)    Changes to the plan are reported to the shareholders’ meeting for ratification upon implementation in accordance with the plan.

(4)    Effective from the resolution of the shareholders’ meeting. The registration was approved by the MEA on June 9, 2020 and has been announced on the Company’s website.

(5)    Effective from the resolution of the shareholders’ meeting and has been announced on the Company’s website.

(6)    Effective after the resolution of the shareholders meeting.

 

(7)    Effective from the resolution of the shareholders’ meeting and has been announced on the Company’s website.

  1. Important resolutions of the Board of Directors in 2020 and as of the printing date of the annual report:

Date

Term

Important resolutions

2020/02/27

21st term

11th meeting

1. Resolution passed for the motion for matters in relation to the Company’s 2020 Annual Meeting of Shareholders.

2. Resolution passed for “Board Performance Evaluation Methods” of the Company.

2020/03/26

21st term

12th meeting

1. Resolution passed for the motion for the Company’s 2019 distribution of remuneration to employees.

1. Resolution passed for the motion for the Company’s 2019 distribution of remuneration to directors.

3. Resolution passed for the motion for the 2019 business report and financial statements.

4. Resolution passed for the motion for the 2019 profit distribution table.

5. Resolution passed for the motion for the result of the Company’s internal control self-evaluation.

6. Resolution passed for the motion for the adjustment of the Company’s CPAs in line with the accounting firm’s internal operation needs.

6. Resolution passed for the motion for the change of the Company’s 2017 plan for issuing new shares by capital injuction.

8. Resolution passed for the motion for the financing amount from Taiwan Cooperative Bank Xinyi Branch.

2020/04/09

21st term

13th meeting

1. Resolution passed for the motion for the amendments to the Company’s Articles of Incorporation.

2. Resolution passed for the motion for the amendments to the Company’s Rules of Procedure for Shareholders Meetings.

3. Resolution passed for the motion for the amendments to the Company’s Methods for the Election of Directors.

4. Resolution passed for the motion for the amendments to the Company’s Procedures of the Acquisition or Disposal of Assets.

1. Resolution passed for the motion to approve the shareholders’ proposal for the 2020 Annual Meeting of Shareholders.

1. Resolution passed for the motion for amending the Company’s 2020 Annual Meeting of Shareholders agenda.

2020/05/11

21st term

14th meeting

1. Resolution passed for the Compensation Committee to recommend the 2019 distribution of remuneration to directors.

2. Resolution passed for the motion recommended by the Compensation Committee for the distribution of remuneration to the appointed managerial officers for 2019.

3. Resolution passed for the motion for the amendments to the Company’s Corporate Governance Practices.

4. Resolution passed for the motion for the amendments to the Company’s Corporate Social Responsibility Practices.

5. Resolution passed for the motion for the amendments to the Company’s Ethical Corporate management Best Practice Principles.

6. Resolution passed for the motion to establish implementation measures for the Company’s whistleblower system.

7. Resolution passed for the motion for the financing amount from Hua Nan Bank Savings Branch.

2020/05/21

21st term

15th meeting

1. Resolution passed for the motion of the Company’s distribution of the 2019 cash dividend related matters.

2020/06/11

21st term

16th meeting

1. Resolution passed for the motion to add the acquisition of long-term equity investments.

2020/08/12

21st term

17th meeting

1. Resolution passed for the motion for the Taisun Enterprise (Zhangzhou) Foods application fund loan amount.

2. Resolution passed for the motion for capital expenditure of equipment investment.

3. Resolution passed for the motion for the financing amount from Bank of Taiwan Taichung Branch.

2020/10/08

21st term

18th meeting

1. Resolution passed for the motion for the capital reduction of Taisun (Cayman) Investment Ltd. to make up for losses.

2020/11/11

21st term

19th meeting

1. Resolution passed for the motion for Taisun (Cayman) Company’s application for endorsement guarantee.

2. Resolution passed for the motion for the financing amount from Kaohsiung Bank Taipei Branch.

2020/12/24

21st term

20th meeting

1. Resolution passed for the motion for 2021 capital expenditure of equipment investment.

2. Resolution passed for the motion for the Company’s 2021 business plan.

3. Resolution passed for the motion for the Company’s 2021 audit plan.

4. Resolution passed for the motion for the donation to Taisun Foundation.

5. Resolution passed for the motion for the establishment of a dedicated unit to promote the ethical management policy.

6. Resolution passed for the motion for the establishment of the Company’s “Procedures for Ethical Management and Guidelines for Conduct”.

7. Resolution passed for the motion for the formulation of the Company’s “Procedures for the Prevention of Insider Trading”.

8. Resolution passed for the motion for the Company’s “Board Performance Evaluation Methods”.

9. Resolution passed for the motion for the financing amount from Taipei Fubon Bank.

Provisional motion: The criteria for evaluating material amounts was established according to the “Q&A of the Regulations Governing Loaning of Funds and Making of Endorsements/Guarantees by Public Companies”. Accounts receivable that exceed 3 months of the normal credit period and are significant in amount shall be approved by the Audit Committee and submitted to the Board of Directors to for a resolution on whether they are for financing.

Resolutions were approved as resolved by the Audit Committee.

2021/01/27

21st term

21st meeting

1. Resolution passed for the motion for 2020 year-end bonus for appointed managerial officers.

2. Resolution passed for the motion for the suggestions on salary adjustment.

3. Resolution passed for the motion for the financing amount from the First Bank Nanjing East Road branch.

2021/03/08

21st term

22nd meeting

1. Resolution passed for the motion for the amendments to the Company’s Rules of Procedure for Shareholders Meetings.

2. Resolution passed for the motion for the amendments to the Company’s Methods for the Election of Directors.

3. Resolution passed for the motion for matters in relation to the Company’s 2021 Annual Meeting of Shareholders.

4. Resolution passed for the motion for the establishment of a dedicated corporate governance unit and manager.

2021/03/25

21st term

23rd meeting

1. Resolution passed for the motion for the Company’s 2020 distribution of remuneration to employees.

2. Resolution passed for the motion for the Company’s 2020 distribution of remuneration to directors.

3. Resolution passed for the motion for the 2020 business report and financial statements.

4. Resolution passed for the motion for the 2020 profit distribution table.

5. Resolution passed for the motion for the amendments to the Company’s Regulations Governing Procedure for Board of Directors Meetings.

6. Resolution passed for the motion for the amendments to the Company’s Rules Governing the Scope of Powers of Independent Directors.

7. Resolution passed for the motion for the amendments to the Company’s Audit Committee Charter.

8. Resolution passed for the motion for the amendments to the Company’s Compensation Committee Charter

9. Resolution passed for the motion for the self-assessment result of the Company’s internal control.

10. Resolution passed for the adjustment of the Company’s CPAs in line with the accounting firm’s internal operation needs

operation needs.

11. Resolution passed for the motion for the financing amount from Taiwan Cooperative Bank Xinyi Branch.

 

(XIII) In the most recent year and up to the date of publication of the annual report, the major contents of the opposition to or qualified opinions expressed by directors or supervisors about the significant resolutions passed by the Board of Directors that have been noted in the records or declared in writing: None.

(XIV) In the most recent year and as of the date of publication of the annual report, resignations by the company chairman, general manager, accounting supervisor, financial supervisor, internal audit supervisor, corporate governance supervisor and R&D supervisor, etc.: None.

 

 

The implementation of the evaluation by the Board of Directors:

 

Evaluation cycle

Evaluation period

Evaluation scope

Evaluation method

Evaluation content

Evaluation result

Once a year

2020/01/01

2020/12/31

1. Board of Directors

2. Board members

3. Functional committees

(including the Audit Committee and Compensation Committee)

Internal self-evaluation

(1) Board of Directors:

Participation in the operation of the company; Improvement of the quality of the board of directors’ decision making; Composition and structure of the board of directors;
Election and continuing education of the directors; and
Internal control.

(2) Board members:

Alignment of the goals and missions of the company; Awareness of the duties of a director; Participation in the operation of the company; Management of internal relationship and communication; The director’s professionalism and continuing education; and Internal control.

(3) Functional committees:

Participation in the operation of the company; Awareness of the duties of the functional committee; Improvement of quality of decisions made by the functional committee; Makeup and structure of the functional committee; and Internal control

(1) Overall evaluation result:

In February 2021, the internal performance evaluation on board members, the Board of Directors and functional committees was completed in accordance with applicable laws and regulations. The evaluation results scored over 95 points according to the evaluation criteria, demonstrating the excellent achievements of the Company’s Board of Directors and functional committees.

(2) Refinement program: According to the Company’s future operations and needs, we will continue to refine and enhance the Board of Directors and functional committees. By doing so, the Company’s corporate governance can be implemented and the competence of the Board of Directors and functional committee improved.

(3) The evaluation results were submitted to the Board of Directors’ meeting held on March 25, 2021.

Note 1: The Board of Directors of the Company passed the “Board Performance Evaluation Methods” on February 27, 2020, stipulating that the Board of Directors shall perform internal evaluations at least once a year with regard to the performance evaluation of the Board of Directors, directors, audit committee and Compensation Committee. The internal performance evaluation results shall be completed before the end of the first quarter of the following year.

Note 2: In regard to the evaluation execution method, evaluation execution is the responsibility of the Agenda Working Group. The evaluation period is from January 1, 2020 to December 31, 2020, using internal questionnaires. It is based on directors’ evaluation of the operation of the Board of Directors, directors’ evaluation of their own participation, the audit committee’s evaluation of committee operations, and the Compensation Committee’s evaluation of committee operation. The Company’s Agenda Working Group will analyze the previous measures, report the results to the Board of Directors, and propose ways to strengthen and improve the director’s suggestions.

 

 

List of major shareholders

 March 28, 2021

Shares

Name of major shareholder

Number of shares held

Shareholding ratio

Long Bon International Industrial Co., Ltd.

123,030,000

24.61%

Baosheng Investment Co., Ltd.

31,434,000

6.29%

Ju-You Investment Co., Ltd.

25,038,000

5.01%

Hongya Investment Co., Ltd.

19,909,161

3.98%

Wang Kuei-Tseng

19,804,628

3.96%

Yuanta Commercial Bank, entrusted with the special property account of Taisun Enterprise Trust

11,534,869

2.31%

Jing Xun Investment Industrial Corporation Limited

10,446,082

2.09%

Pin-Tai Distribution Enterprise Co., Ltd.

10,351,332

2.07%

Chiu, Hsien-Tao

9,000,000

1.80%

Kandlee Trading Co., Ltd.

7,643,629

1.53%

 

The annual work focus of the audit committee

The audit committee aims to assist the Board of Directors in fulfilling its supervisory duties and is responsible for the tasks entrusted to it by the Company Act, the Securities and Exchange Act and other relevant laws and regulations, and for implementing the quality and integrity of accounting, auditing, financial reporting processes, and financial control. The committee is composed of all three independent directors. Independent director Wu Chieh-Hsin serves as the convener, and the committee is held at least once a quarter.
1. The audit committee’s powers and considerations mainly include:
(1) Establishing or amending the internal control system in accordance with the provisions of Article 14-1 of the Securities and Exchange Act.
(2) Evaluation of the effectiveness of the internal control system.
(3) In accordance with the provisions of Article 36-1 of the Securities and Exchange Act, to stipulate or amend the procedures for acquiring or disposing of assets, engaging in derivatives transactions, making loans to others, endorsing or providing guarantees for others, and procedure for major financial operations.
(4) Matters involving directors’ own matters of interest.
(5) Transactions of major assets or derivatives.
(6) Significant capital loans, endorsements, or guarantees.
(7) Raising, issuing, or private placement of equity securities.
(8) Appointment, dismissal, or remuneration of certified public accountants.
(9) Assessment of qualifications and independence of certified public accountants.
(9) Appointment and removal of financial, accounting, or internal audit supervisors.
(10) Financial reports for Q1, Q2 and Q3 and the annual financial reports signed or sealed by the Chairman, managerial officers and Accounting Supervisor.
(11) Self-evaluation questionnaires for audit committee performance evaluations
(12) Other important matters specified by the Company or the competent authority.
Reviews of financial reports
The Board of Directors prepared the Company’s 2020 annual business report, financial statements, and earnings distribution proposals, among which the financial statements were verified by KPMG Taiwan certified public accountants, and a verification report was issued. The above-mentioned business reports, financial statements, and profit distribution proposal have been checked by the audit committee and it was found that there are no discrepancies.
Assess the effectiveness of the internal control system
The audit committee evaluates the effectiveness of the Company’s internal control system policies and procedures (including control measures such as finance, operation, risk management, information security, outsourcing, compliance with laws and regulations). Furthermore, it reviews the Company’s audit department, certified accountants, and management’s regular reports and compliance with laws and regulations. The Audit Committee suggests that the Company’s risk management and internal control system are effective and that the Company has adopted necessary control mechanisms to monitor and address violations.
Appointment of a certified public accountant
(1) The audit committee is assigned the responsibility of supervising the independence of the certified public accounting firm to ensure the fairness of the financial statements.
In order to ensure the independence of the certified public accountant firm, the Audit Committee has developed an independence evaluation form in accordance with Article 47 of the Certified Public Accountant Act and Bulletin No. 10 of the Code of Professional Ethics for Accountants. Regarding the independence, professionalism, and competence of accountants, it assesses whether they are related parties, or have mutual business or financial interests with the Company. The Audit Committee, on March 25, 2021, and the Board of Directors, on March 25, 2021 both approved accountants Tseng Kuo-Yang and Chen Chung-Che of KPMG Taiwan as meeting the independence assessment standards and as qualified to serve as accountants for the Company’s financial and tax matters.
(2) On March 25, 2021, the Audit Committee resolved to change the Company’s CPAs for the audit of the financial reports from the first quarter of 2021 in line with the auditing standards and the internal operations of KPMG. The original CPAs were Tseng Kuo-Yang and Chen Chung-Che and the new CPAs are Huang Hsin-Ting and Tseng Kuo-Yang.

Information on the operations of the audit committee

In 2020and as of the printing date of the annual report, the audit committee met 8 times (A), and the attendance of independent directors is as follows:

Term

Job title

Name

Actual attendance (B)

Number of delegates attending

Actual attendance rate (%)

(B/A)

2nd term

Independent Director

Wu Chieh-Hsin

8

0

100%

Independent Director

Sun Chu-Wei

8

0

100%

Independent Director

Hsu Yung-Chang

8

0

100%

Other matters to be recorded:

  1. If the operations of the audit committee falls under one of the following situations, the date, period, resolution of the proposal, the resolution of the audit committee, and the Company’s handling of the audit committee’s opinions shall be stated.

(I) Matters listed in Article 14-5 of the Securities and Exchange Act:

In 2020 and as of the publication date of the annual report, a total of 6 audit committee meetings were held. The resolutions are detailed on page 26 of the annual report. The audit committee passed without objection the matters listed in Article 14-5 of the Securities and Exchange Act.

(II) Further to the aforementioned matters, motions rejected by the Auditing Committee but passed by the Board at the consent of more than 2/3 of the Directors: None.

  1. For avoidance of conflict of interest by independent directors, the name of independent directors, details of proposals, reasons for avoidance and voting results shall be stated: None.

III. The communication between the Independent Directors and the Chief Internal Auditor and the CPAs (materiality, means, and result of communication on the financial position and operation of the Company should be covered):

  1. In accordance with the 2020 audit plan approved by the Board of Directors, the Company prepares monthly “audit reports” and submits them to each audit committee for review, which has been completed on a monthly basis. It also follows the Regulations Governing Establishment of Internal Control Systems by Public Companies. After the audit report and tracking report are reviewed, they are delivered or notified to independent directors for review, and the audit conclusions and various declaration materials are provided for reference.
  2. Each audit report must track its internal control deficiencies and the improvement of abnormal matters, and make a quarterly tracking report and submit it to each audit committee member.
  3. The head of internal audit attends the audit committee and the Board of Directors on a quarterly basis to report on the audit business, and communicates with independent directors through the audit committee.
  4. The communication between independent directors and the head of internal audit in 2020 is summarized as follows:

 

Date

Communication meeting

Communication matters

Communicate results

2020/03/26

Audit Committee

Tracking report of the audit results for the 4th quarter of 2019

2019 internal control self-assessment results

No comments at this meeting

2020/05/11

Audit Committee

Tracking report of the audit results for the 1st quarter of 2020

No comments at this meeting

2020/08/12

Audit Committee

Tracking report of the audit results for the 2nd quarter of 2020

No comments at this meeting

2020/11/11

Audit Committee

Tracking report of the audit results for the 3rd quarter of 2020

No comments at this meeting

2020/12/24

Audit Committee

2021 annual audit plan

No comments at this meeting

  1. The Company submits the results of financial statements reviewed or audited by the CPAs to the Audit Committee and arranges for communication between the CPAs and independent directors at least once a year.

  The communication between independent directors and accountants is summarized as follows:

Date

Communication matters

Communicate results

2020/01/20

1. Taisun Group 2019 matters of high concern

2. Taisun Group’s key audit items in 2019

3. Future challenges

No comments at this meeting

2020/12/16

1. Annual audit scope 2. Key audit matters

3. Matters concerned by the competent authorities 4. Other matters requiring attention

5. Updates of important laws

No comments at this meeting

 

 

 

Important resolutions of the audit committee in 2020 and as of the printing date of the annual report

Audit Committee

Proposal content

Resolution result

The Company’s handling of the audit committee’s opinions

The 8th meeting of the 2nd Committee

2020/03/26

 

1. Tracking report of the audit results for the 4th quarter of 2019

2. Accountant financial independence assessment report

3. Review the Company’s 2019 annual business report, financial statements, and profit distribution statement

4. Motion for the review of the Company’s internal control self-evaluation results

5. Motion for the adjustment of the Company’s CPAs in line with the accounting firm’s internal operation needs.

6. Motion for the change of the Company’s 2017 plan for issuing new shares by capital injuction

After the consultation of the Chairman, the motion was passed with no objection.

Submitted to the Company’s Board of Directors for resolution

The 9th meeting of the 2nd Committee

2020/04/09

1. Motions for the amendment to the Company’s Procedures of the Acquisition or Disposal of Assets

After the consultation of the Chairman, the motion was passed with no objection.

Submitted to the Company’s Board of Directors for resolution

The 10th meeting of the 2nd Committee

2020/05/11

1. Tracking report of the audit results for the 1st quarter of 2020

2 Review the Company’s financial statements for the second quarter of 2019

After the consultation of the Chairman, the motion was passed with no objection.

Submitted to the Company’s Board of Directors for resolution

The 11th meeting of the 2nd Committee

2020/06/11

1. Motion for the intention to add the acquisition of long-term equity investments

After consulting with all the members present, the motion was passed as the Chairman resolved to approve the resolution to lift the prohibition of competition between new directors.

Submitted to the Company’s Board of Directors for resolution

The 12th meeting of the 2nd Committee

2020/08/12

1. Tracking report of the audit results for the 2nd quarter of 2020

2 Review the Company’s financial statements for the second quarter of 2020

3. Motion for the application of capital loans and credit lines for Taisun Enterprise (Zhangzhou) Foods.

4. Motion for capital expenditure of equipment investment

After the consultation of the Chairman, the motion was passed with no objection.

Submitted to the Company’s Board of Directors for resolution

The 13th meeting of the 2nd Committee

2020/11/11

1. Tracking report of the audit results for the 3rd quarter of 2020

2. Review of the Company’s financial statements for the 3rd quarter of 2020

3. Motion for the application for endorsement/guarantee of Taisun (Cayman).

After the consultation of the Chairman, the motion was passed with no objection.

Submitted to the Company’s Board of Directors for resolution

The 14th meeting of the 2nd Committee

2020/12/24

1. The Company’s 2021 business plan

2. The Company’s 2021 audit plan

 

Provisional motion: The criteria for evaluating material amounts was established according to the “Q&A of the Regulations Governing Loaning of Funds and Making of Endorsements/Guarantees by Public Companies”. Accounts receivable that exceed 3 months of the normal credit period and are significant in amount shall be approved by the Audit Committee and submitted to the Board of Directors to for a resolution on whether they are for financing.

After the consultation of the Chairman, the motion was passed with no objection.

Provisional motion: After the chairman consulted with all members present, the evaluation criteria for a significant amount was set at NT$10 million. It was determined that there was no capital loans based on accounts receivable that exceeded the normal credit terms of 3 months at the end of November.

Submitted to the Company’s Board of Directors for resolution

The 15th meeting of the 2nd Committee

2021/03/25

1. Tracking report of the audit results for the 4th quarter of 2020

2. Motion for the review of the Company’s 2019 business report and financial statements

3. Motion for the Company’s 2020 profit distribution table

4. Motion for the amendments to the Company’s Rules Governing the Scope of Powers of Independent Directors

5. Motion for the amendments to the Company’s Audit Committee Charter

6. Motion for the review of the Company’s internal control self-evaluation results

7. Motion for the adjustment of the Company’s CPAs in line with the accounting firm’s internal operation needs.

After the consultation of the Chairman, the motion was passed with no objection.

Submitted to the Company’s Board of Directors for resolution

Information of Compensation Committee Members

 

Identity

(Note 1)

   Condition

 

 

 

Name

 

Have more than five years of work experience and the following professional qualifications

Meet conditions of independence (Note 2)

Number concurrently serving as members of the Compensation Committees of other publicly issued companies

Remarks

Remarks

 

End of full text

 

Lecturers in public and private colleges and universities with relevant materials required for business, legal affairs, finance, accounting, or corporate business

Judges, prosecutors, lawyers, accountants or other professional and technical personnel who have passed the national examinations required for corporate business and have certificates

Have work experience required for business, legal affairs, finance, accounting, or corporate business

1

2

3

4

5

6

7

8

9

10

 

 

Independent Director

Wu Chieh-Hsin

 

 

V

V

V

V

V

V

V

V

V

V

V

1

 

Other

Tung Chun-Jen

 

 

V

V

V

V

V

V

V

V

V

V

V

0

 

Other

Liu Ming-Hsiung

 

 

V

V

V

V

V

V

V

V

V

V

V

1

 

Independent Director

Sun Chu-Wei

 

V

V

V

V

V

V

V

V

V

V

V

V

2

 

Independent Director

Hsu Yung-Chang

 

V

V

V

V

V

V

V

V

V

V

V

V

0

 

                                     

Note 1: Please enter as director, independent director, or other.

Note 2: If each member meets the following conditions two years before the election and during the tenure, please type “ü” in the space below each condition code.

 (1) Not an employee of the Company or its affiliates.

 (2) Not a director or supervisor of the Company or its affiliates. (However, in the case of independent directors established and concurrently serving in the company and its parent company, subsidiary company or subsidiary company of the same parent company in accordance with this law or local laws, this limitation shall not apply.)

(3) Not a natural-person shareholder who holds shares, together with those held by the person’s spouse, minor children, or held by the person under others’ names, in an aggregate amount of one percent or more of the total number of outstanding shares of the Company or ranking in the top ten in holdings.

(4) Not a manager of those listed in (1), or someone having a relationship with those listed in (2) or (3) including a spousal relationship, a second-degree kinship or closer, or an immediate blood relative within three degrees of kinship.

(5) Not a director, supervisor, or employee of a corporate shareholder that directly holds five percent or more of the total number of outstanding shares of the Company or that holds shares ranking in the top five in holdings, or is designated as a representative in accordance with Article 27, Paragraph 1 or 2 of the Company Act. (However, in the case of independent directors established and concurrently serving in the company and its parent company, subsidiary company or subsidiary company of the same parent company in accordance with this law or local laws, this limitation shall not apply.)

(6) Not a director, supervisor, or employee of another company controlled by the same person with more than half of the shares with voting rights on the company’s board of directors. (However, in the case of independent directors established and concurrently serving in the company and its parent company, subsidiary company or subsidiary company of the same parent company in accordance with this law or local laws, this limitation shall not apply.)

(7) Not a director, supervisor, or employee of another company or institution whose chairman, general manager, or equivalent position is the same person as that of the Company, or the spouse thereof. (However, in the case of independent directors established and concurrently serving in the company and its parent company, subsidiary company or subsidiary company of the same parent company in accordance with this law or local laws, this limitation shall not apply.) .

(8) Not a director, supervisor, or manager of a specific company or institution having financial or business dealings with the Company, or a shareholder holding 5% or more of shares.(However, if a specific company or institution holds more than 20% of the total issued shares of the company but not more than 50%, and the established independent director concurrently serves in the company and its parent company, subsidiary company or subsidiary company of the same parent company in accordance with this law or local laws, this limitation shall not apply.)

(9) Not an owner, partner, director, supervisor, manager, or spouse thereof of a company or institution that provides commercial, legal, financial, accounting services or consultation to the company or any affiliate of the Company for amounts exceeding NT$500,000 in the past two years. However, for members of the Compensation Committee, Public Acquisitions Review Committee, or M&A Special Committee who perform their functions and powers in accordance with the relevant laws and regulations of the Securities and Exchange Act or the Business Mergers & Acquisitions Act, this limitation shall not apply. .

(10) The circumstances specified in Article 30 of the Company Act are not applicable.

Information on the function of the Compensation Committee

(1) There are five members of the Compensation Committee of the Company.

(2) The terms of the current members: From December 18, 2018 to November 20, 2021; during 2020 up until March 31, 2021 the Compensation Committee met 5 times (A). The qualifications and attendance of the members are as follows:

Term

Job title

Name

Actual attendance (B)

Number of delegates attending

Actual attendance rate (%)

(B/A)

Remarks

The 4th Committee

Chairperson

Wu Chieh-Hsin

5

0

100%

 

Committee member

Tung Chun-Jen

4

1

80%

Committee member

Liu Ming-Hsiung

5

0

100%

Committee member

Sun Chu-Wei

5

0

100%

  Committee member

Hsu Yung-Chang

5

0

100%

Other matters to be recorded:

I. If the Board of Directors disapproves or amends the recommendations from the Compensation Committee, it shall state the date and duration of the meeting of the Board of Directors, details of proposals, the results of the resolutions of the Board of Directors and how the Company deals with the opinions of the Compensation Committee (if the salary and remuneration approved by the Board of Directors are higher than such amount recommended by the Compensation Committee, the Board of Directors shall state the difference and the reasons): There is no such situation; please refer to page 42 of the annual report.

II. If a specific member of the Compensation Committee has adverse or qualified opinions on the resolutions of the Compensation Committee on record or in written declaration, specify the meeting date, the session, the content of the motion, the opinions of all members, and the response to the opinions of the members: None.

  1. Compensation Committee’s powers:

(1) The functions of the Company’s Compensation Committee are based on the attention of good managers, evaluating the remuneration policies and systems of directors, independent directors and managers of the Company, and meeting at least twice a year. Furthermore, it may hold meetings at any time as needed to make recommendations to the Board of Directors for its decision-making reference.

(2) The powers of the Company’s Compensation Committee

  1. Periodically review the Compensation Committee Charter and propose amendments.
  2. Formulate and regularly review the Company’s directors, independent directors and managers’ annual and long-term performance targets and remuneration policies, systems, standards, and structures.
  3. Regularly evaluate the achievement of the performance targets of the directors, independent directors, and managers of the Company, and evaluate and set the content and amounts of their individual salaries.

(3) When performing the official powers, the Compensation Committee shall follow the principles listed below:

  1. Ensuring that the remuneration arrangements of the Company comply with applicable laws and regulations and are sufficient to recruit outstanding talent.
  2. The performance evaluation and remuneration of directors, independent directors and managers should refer to the usual level of payment in the industry. It also considers the time invested by the individual, the responsibilities assumed by the individual, the status of achieving personal goals, the performance of other positions, and the salary remuneration given by the Company to those in the same position in recent years. It also evaluates the rationality of the relationship between individual performance and the Company’s operating performance and future risks through the achievement of the Company’s short-term and long-term business goals and the Company’s financial status.
  3. Directors and managers should not be guided to engage in behaviors that exceed the Company’s risk appetite in pursuit of remuneration.
  4. The ratio of dividends to the short-term performance of directors and managers and the payment time of part of the variable salary shall be determined in consideration of the characteristics of the industry and the nature of the Company’s business.
  5. Members of this committee shall not participate in discussion and voting on their personal salary and remuneration decisions.

The salary and remuneration mentioned in the preceding two paragraphs include cash remuneration, stock options, dividends, retirement benefits or severance payments, various allowances and other measures with substantial incentives. Its scope should be consistent with the remuneration of directors, independent directors and managers in the Regulations Governing Information to be Published in Annual Reports of Public Companies.

If the remuneration of directors and managers of a subsidiary of the Company is subject to the approval of the Company’s Board of Directors according to the subsidiary’s hierarchical responsibility, the Board of Directors shall make recommendations before submitting it to the board for discussion.

The Compensation Committee discusses the subject and resolution results and the Company's handling of members’ opinions

 

Compensation Committee

Proposal content

Compensation Committee resolution results

The Company’s handling of the opinions of the Compensation Committee

4th meeting of the 4th Committee

2020/03/17

1.   Self-evaluation of Performance Questionnaire of the Compensation Committee of Taisun Enterprise Co., Ltd.

2.   Motion for total remuneration to directors and the distribution ratio for 2019

All members present agreed to pass

Passed in accordance with the resolution of the Compensation Committee and submitted to the Board of Directors for resolution

5th meeting of the 4th Committee

2020/04/28

1.   2019 analysis report on the self-evaluation of performance of the Compensation Committee

All members present agreed to pass

None

2.   Motion for the suggestions on the distribution of remuneration to directors and appointed managerial officers for 2019

Passed in accordance with the resolution of the Compensation Committee and submitted to the Board of Directors for resolution

6th meeting of the 4th Committee

2021/01/19

1.    Motion for year-end bonus for 2020

2.    Motion for adjusting salaries for 2021

All members present agreed to pass

Passed in accordance with the resolution of the Compensation Committee and submitted to the Board of Directors for resolution

7th meeting of the 4th Committee

2021/03/17

1.    Motion for the suggestions on the total remuneration to directors and distribution ratio for 2020.

2.    Motion for the suggestions on the remuneration to the Corporate Governance Manager.

3.    Amendments to the Compensation Committee Charter of Taisun Enterprise Co., Ltd.

All members present agreed to pass

Passed in accordance with the resolution of the Compensation Committee and submitted to the Board of Directors for resolution

8th meeting of the 4th Committee

2021/03/25

Motion for the suggestions on the total remuneration to directors and distribution ratio for 2020.

All members present agreed to pass

Passed in accordance with the resolution of the Compensation Committee and submitted to the Board of Directors for resolution