Since June 2016, TSC has adopted a candidate nomination system for the election of all non-independent directors and independent directors. According to TSC Corporate Governance Best Practice Principles, the composition of the Board of Directors should be determined based on the company’s business development scale and the shareholding structure of its major shareholders, taking into account practical operational needs. The composition of the board members should consider diversity, with no more than one-third of the board seats held by directors who are also company executives. The board should develop an appropriate diversification policy based on its own operations, business model, and development needs, including but not limited to the following two main criteria:

1. Basic criteria and values: Gender, age, nationality, and culture, with a target of achieving a one-third representation of female directors.
2. Professional knowledge and skills: Professional backgrounds (such as law, accounting, industry, finance, marketing, or technology), professional skills, and industry experience. Board members should generally possess the knowledge, skills, and qualifications necessary to perform their duties.

To achieve the ideal goals of corporate governance, the board as a whole should have the following abilities:

1. Operational judgment.
2. Accounting and financial analysis skills.
3. Management and leadership skills.
4. Crisis management skills.
5. Industry knowledge.
6. International market perspective.
7. Leadership skills.
8. Decision-making skills.

Currently, all seven directors of our company are Taiwanese nationals, and they all have the necessary knowledge, skills, and qualifications required to perform their duties, as evidenced by their previous experiences. They have diverse professional backgrounds in accounting, finance, business, law, marketing, or industrial technology. The age range of the directors is as follows: three directors (52.3%) are in the 61-76 age range (Wang Shiu-Ting, Lin Bo-Sheng, Jhan Cian-Long), one director (14.4%) is in the 51-60 age range (Fan Hong-Shu), and three directors (33.3%) are in the 41-50 age range (Wang Xing-Lei, Liu Chang-Yu, Ma Shu-Zhuang).

Board of Directors

Board of Directors Independence

1. Board Structure: TSC has established a director selection system, and the appointment process for all directors is open and fair, in compliance with the Company’s “Articles of Incorporation,” “Director Election Regulations,” “Corporate Governance Best Practice Principles,” “Regulations for the Establishment and Compliance of Independent Directors in Publicly Issued Companies,” and “Article 14-2 of the Securities Exchange Act.” The current composition of the board consists of 3 directors (42.86%) and 4 independent directors (57.14%), of which 2 directors hold positions as employees or executives (28.57%, not exceeding one-third of all board seats). More than half of the board members do not have spousal or second-degree relative relationships, as required by Article 26-3, paragraph 3 and paragraph 4 of the Securities Exchange Act.
2. Board Independence: The board of directors of TSC guides the company’s strategy, supervises management, and is responsible to the company and shareholders in all aspects of corporate governance. The board operates independently and transparently, and both directors and independent directors are independent individuals who exercise their powers independently. The four independent directors also comply with relevant laws and regulations, work in conjunction with the Audit Committee, and assess the control of existing or potential risks in the company. This ensures effective implementation of internal controls, the selection and removal of auditors, and the appropriate preparation of financial statements.

In addition, TSC has established a board performance evaluation system, which includes annual self-assessment by board members and self-assessment by directors.

The board performance evaluation covers five main aspects:

1. Participation in the company’s operations
2. Quality of board decisions
3. Board composition and structure
4. Director selection and continuing education
5. Internal controls.

Director self-assessment includes six main aspects:

1. Understanding of the company’s goals and missions
2. Awareness of director responsibilities
3. Participation in the company’s operations
4. Management of internal relationships and communication
5. Director’s expertise and continuing education
6. Internal controls

Furthermore, to provide the investment community with a comprehensive understanding of the operation of our board of directors, relevant information is disclosed in our company’s annual report, official website, and the Taiwan Stock Exchange’s public information observation platform, including:

1. Attendance of board members at meetings.
2. Board meeting agendas and resolutions.
3. Ongoing education for board members.
4. Changes in the shareholding of board members (ownership percentage, share transfers, and the establishment of security interests, etc.). Please refer to the Taiwan Stock Exchange’s public information observation platform for details.