HTC 2015 Annual Report Download - page 43

Corporate governance
Corporate governance
82
83
(3) The State of the Company's Implementation of Corporate Governance,
departures of such implementation from The Corporate Governance
Best-Practice Principles for TSEC/ GTSM Listed Companies, and reasons
for departures.
Item
ImplementationStatus Reason for Non-
implementation
YES NO Summary
1. Whether the company has adopted and revealed principles
for practice of corporate governance in accordance with
"CorporateGovernanceBestPracticePrinciplesforTWSE/
GTSMListedCompanies"?
vIn2014,HTCadoptedthe“HTCCorporateGovernancePrinciples”.
ItsprovisionsarebasedontheCorporateGovernanceBest-Practice
PrinciplesforTSEC/GTSMListedCompaniesandareannouncedin
the English and Chinese investor relations websites.
None
2. ShareholdingStructure&Shareholders'Rights
(1) Whether the company has the internal operation
procedures of handling shareholder suggestions, questions,
lawsuits or complaints, and proceed by complying with the
procedures.
v To protect shareholders' interests, HTC has appointed spokesperson
and acting spokesperson to properly handle any questions, suggestions,
or disputes involving shareholders.
None
(2)Whetherthecompanyunderstandsthemajorshareholders
andtheultimateownersofthesemajorshareholders.
vTheCompanyhasagoodunderstandingofitsmajorshareholders
through shareholder registers provided by stock agents at book
closures. HTC also provides information regularly on pledges and the
increase and decrease in shareholdings of shareholders with a more
than10%stakeinthecompany.
None
(3)Whetherthecompanysetsupandexecutingofrisk
management mechanism and "firewalls" between the
company and its affiliates
v The division of responsibilities between HTC and its affiliates with
respect to management of personnel, resources, and finances is clear.
Risk assessments are rigorously performed and appropriate firewalls
have been established. HTC conducts business with affiliates based
on the principles of fairness and reasonableness and fully observe
theoperatingProceduresfortransactionswithSpecificCompanies,
EnterpriseGroupsandRelatedPartiesandotherrelatedregulations.
Terms and conditions, pricing, and payment methods are clearly
prescribed in contracts to avoid non-arms-length transactions and
financial tunneling. When it is necessary to eliminate non-competition
restrictions on directors and managerial officers, requests are duly
submittedtotheShareholders'MeetingandBoardforapproval.
None
(4) Whether the company has adopted internal rules to forbid
against use of unpublicized information in the market by
internalstaffsforpurchaseofpricedstocks?
vThecompanyhasadoptedthe“OperationalProceduresforHandling
MaterialInsideInformationandPreventingInsiderTranding”.It
governs purchase and sale of priced stocks by internal staffs.
None
3. CompositionandResponsibilitiesoftheBoardofDirectors
(1) WhethertheBoardofDirectorshasadoptedguidelines
for diversity of composing members and has put the
guidelinesintofullpractice?
vInthe“Principlesforpracticeofcorporategovernance”,thecompany
has specified that knowledge, skills, and trainings be considered when
nominatingaBoardmemberandSupervisor.Alsoinconsiderationis
genderequalitythatcontributestodiversityofBoardmembers.Rules
given in the principles should be carried out in full.
None
(2) Whether the company is willing to set up various other
functional committees, in addition to the committees for
salaries/compensations and auditing set up according to
thelaw?
v For the purpose of developing supervision functions and strengthening
managementmechanisms,theBoardofDirectorsoftheCompany
may,takingintoaccountthesizeoftheBoardandthenumberofthe
IndependentDirectors,setupremunerationoranyotherfunctional
committees.
Considering the
number of the
Independent
Directors, HTC
has only set up
the remuneration
committees.
(3)Whetherthecompanyhasadoptedrulesandmethods
forassessmentonperformancesoftheBoardthatwillbe
carriedoutannuallyonaregularbasis?
v The company has adopted“Rules Regarding Organization for the
Salary and Compensation Committee”where rules and methods are
specifiedforassessmentonperformanceoftheBoard.Underperiodic
reviewsareannualandlong-termgoalsforperformanceoftheBoard,
as well as policies, rules, standards, and structures for the salary and
compensation.
None
(4) Whether the company will regularly assess independence
ofitscertifiedaccountants?
vIn2008,HTCstartedtohaveitsSupervisorsreviewtheindependence
ofCPAsonanannualbasis.Priortosubmittingaproposaltochange
CPAtotheBoard,theCPAwillbeinterviewedandhiscredentials
reviewed by the Supervisors to assess his independence.
None
(Continued)
Item
ImplementationStatus Reason for Non-
implementation
YES NO Summary
4. Whether the company
has established a channel
for communicating with
Stakeholders, set up a section
for Stakeholders on the
company website, and properly
responded to important
topics regarding corporate
social responsibilities that
Stakeholdercareabout?
v HTC provides detailed contact information, including telephone numbers and email addresses, in the “contact
us” section of its corporate website. We also have personnel in place to exclusively deal with messages to the
spokesperson and investor mailboxes so that various interested parties will have channels to communicate
with HTC.
None
5. Whether the company has
delegated a professional
shareholder services agency for
handingAGMaffairs?
vThecompanyhasdelegatedCTBCBankCo.,Ltd.tobetheshareholderserviceagencyforhandlingAGM
affairs.
None
6. InformationDisclosure
(1) Establishment of a
corporate website to disclose
information regarding
the Company's financials,
business and corporate
governance
vHTChasbothChineseandEnglishwebsites.HTCInvestorspagesprovideinformationonfinancialand
businessandcorporategovernance,whilePRODUCTSpagesprovideinformationrelatingtoourproducts
and services.
None
(2) Other information
disclosure channels
(e.g., maintaining an
English-language website,
appointing responsible
people to handle
information collection
and disclosure, appointing
spokespersons, webcasting
investors conference)
vHTC has English and Chinese investor relations websites. Dedicated personnel have been assigned to collect
and update information to websites. Chief Financial Officer Chialin Chang has been appointed spokesperson
and a spokesperson email address has been established. An investor conference is convened online each
quarter. Recording and presentation are posted on the company website after the conference.
None
7. Other important information
helpful to understanding HTC's
corporate governance practices
(including but not limited in
employee rights and interests,
employee care, investor
relations, supplier relations
and rights of Stakeholders,
professional development of the
BoardofDirectors,Supervisors,
and managerial officers,
status of implementation
of risk management
policies and standards for
measurement of risk, status
of customer-protection policy
implementation, and liability
insurance provided by HTC
totheBoardofDirectorsand
Supervisors) :
v (1) Employee rights and interests and employee care
HTC's employee code of conduct provides rules and guidelines for employees to follow when involved
in company operations. All employees of the company and its branches and subsidiaries, regardless of
their position, level, or location, need to abide by this code of conduct. Any unlawful conduct, either at the
company or otherwise is prohibited.
HTC is committed to providing a safe and healthy work environment, to respecting individuals and
offering fair equality of opportunity, and to protecting company assets and personal information.
Inrelationswithcustomersandsuppliers,HTCcommitstomaintaininglong-termrelationshipsonafair
andreasonablebasisinordertocreatewin-winpartnerrelationships.IntheConflictsofInterestsection
in “HTC's Code of Conduct”, HTC provides principles of conduct to guide employees.
HTC's hiring policies comply with the relevant laws and regulations and provide fair opportunities to
applicants. Hiring decisions are based on HTC's operational needs, nature of the work, and applicants'
abilities. Fair opportunities are provided to both applicants and employees. There will be absolutely no
discrimination on the basis of nonwork-related factors, such as race, skin color, social position, language,
belief, religion, political attillation, family origin, gender, sexual orientation, marital status, appearance,
facial features, mental or physical disabilities, previous union affiliation, or any other factor protected by
government order.
HTC management adheres firmly to the principles of respect for the individual, good faith, and
responsibility. These principles are applied (but not limited) to recruitment, hiring, training, promotion,
pay scales, benefits, transfers, and community activities.
HTC is committed to providing employees with a working environment free of discrimination or
harassment (including sexual harassment). Any form of speech or conduct intended to incite hatred,
conductwhichcouldleadtoaccidentalinjury,ordiscrimination,willbeimmediatelyreportedtothe
responsible department for investigation and punishment.
Inadditiontocomplyingwithlegalrequirements,HTCrespectstheprivacyofitsemployeesandprotects
their personal information, and never arbitrarily discloses personal data of employees. Employees are also
expected to abide by this principle in their interactions, and to avoid discussing private matters or secret
information of others (including but not limited to salary and bonus information).
(Continued)