Corporate Governance

Management Philosophy

Pursue Excellence, Continuous Growth

Collaborative Spirit, Mutual Trust

Cheerful Attitude, Energic Team

Quality First, Creative Innovation

Outstanding Leadership, Develop Talents

Corporate Governance Framework

Unimicron implements corporate governance based on the Company's vision of “a world-class high-tech Company with high added value, high quality, high productivity, and an emphasis on innovation and service” and “pursuing customer, employee, shareholder satisfaction and social responsibility”. In 2023, we continued to implement the five objectives of the 2022-2025 business management plan. At the same time, to innovate corporate value, we have set five goals for the period from 2025 to 2027, including “Collaborate with customers to create blue ocean markets and products”, "Establish A+ management team to build world-class competitiveness", “Make good use of digital operations to establish efficient and intelligent operations and services”, “Agile Risk Management and sequential international operations ", “Press ahead on ESG, care for the earth and company sustainability” to implement sustainable corporate governance.

Operation of the Board of Directors

The board of directors is the highest governance unit of the Company, with key functions including reviewing business performance, preventing conflicts of interest, and ensuring compliance with laws and regulations. The board meets at least quarterly, adhering to the “Rules and Procedures of Board of Directors Meetings”. The board consists of 9 directors from diverse professional backgrounds, including 3 independent directors and 1 external individual director. Non-managerial directors make up two-thirds of the board. The current directors were elected on May 30, 2023, for a three-year term, includes one female director, and none of the independent directors serve on more than three other publicly traded companies' boards. Details on director diversity, professional qualifications, and independence are available on Page 8 of the 2023 Annual Report and the Company's website. In 2023, the board held 6 meetings with an average attendance rate of 98%.

Election of Directors

Directors are elected based on the "Rules for Election of Directors," using a nomination system at the shareholders' meeting and a registered cumulative voting system. Each share has votes equal to the number of directors to be elected, which can be allocated to one or more candidates. According to the Company's Articles of Incorporation and related announcements, candidates with the most votes are elected as directors and independent directors in order. Unimicron's Board of Directors follows Article 20 of the "Corporate Governance Best Practice Principles" and considers operational and developmental needs for diversity, focusing on two major aspects of the standards:

1.Basic conditions and values: Gender, age, nationality, culture, etc.
2.Professional knowledge and skills: Professional background, professional skills, industry experience, etc.
Board members must have the necessary knowledge, skills, and literacy, including operational judgment, financial analysis, management skills, crisis management, industry knowledge, international perspective, leadership, and decision-making skills.
Independent directors can serve on up to three other public companies' boards, with at least one having accounting or financial expertise. Each director shall not have a spouse or a relative relationship within the second degree of affinity.
Unimicron established the "Methods to Evaluate Performance of the Board" in 2020, conducting annual performance evaluations of the Board, its members, and functional committees. External evaluations occur at least once every three years by an external professional and independent organization or a team of external experts and academics, informing the selection or nomination of directors.

Board of Directors

Board members are elected at the shareholders' meeting according to the "Rules for Election of Directors" and the Company’s Articles of Incorporation. Committees are nominated and selected by the Board. All three independent directors meet the qualifications, experience, and independence criteria set by the "Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies."
To enhance Board roles, directors attended company-arranged training in 2023, totaling 87 hours—averaging 9.67 hours per director—surpassing the requirement of 6 hours. Training covered corporate governance, sustainability, ESG, climate change, mergers and acquisitions, tax developments, and regulatory trends. Details are in Unimicron's 2023 Annual Report, Page 21.

Professional and Background of Directors

The Diversity & Independence of the Board of Directors

The Company’s Board of Directors includes experts in business management, financial accounting, chemical industry, physics, and investment. Its members include general managers and CFOs of listed companies, technology and investment operators, semiconductor and electronics experts, and the chairman of the Taiwan Digital Federation of Enterprises. Their expertise and the work of functional committees enhance corporate governance, environmental sustainability, social responsibility, and law oversight, significantly aiding our business planning and policy formulation. As the highest governance body, the Board oversees business performance, prevents conflicts of interest, and ensures legal and regulatory compliance. It meets at least quarterly, by the Company’s “Rules and Procedures of Board of Directors Meetings.” For details on individual directors and the Director's Professional Competency Matrix, please refer to the Unimicron website.

The Company's board of directors comprises 9 members with diverse professional backgrounds, including 3 independent directors (one of whom is female), making up one-third of the board. Directors' terms are limited to three terms. The Company prioritizes independence and gender equality, aiming for at least three independent directors and one female director, consistently maintaining a 100% achievement rate for these goals.

Board Performance Evaluation Linked with Sustainability Performance

Unimicron performs annual evaluations of the Board, its Functional Committees, and individual directors using the “Methods to Evaluate Performance of the Board.” By mid-January, the financial department collects board data, sends self-evaluation questionnaires to all directors, and compiles results by the end of January. Evaluation results are presented to the Board before the end of Q1 and detailed in the annual report. The 2023 self-evaluation, covering the "Audit Committee," "Remuneration Committee," and "Business Continuity and Nomination Committee," was submitted to the Board on February 23, 2024, with an "Excellent" rating. In addition to internal evaluations, we arrange an external Board assessment every three years.

In 2022, the Taiwan Corporate Governance Association conducted this evaluation through online self-assessments and video interviews. The assessment covered eight components: board composition, guidance, authorization, supervision, communication, internal control, risk management, and board self-discipline, as well as board meetings and support systems. The report, released on February 18, 2023, was presented to the Nominating Committee and Board on March 13, 2023. For details, visit the Company’s website under “Investors/Corporate Governance.”

The Company’s remuneration policies, standards, and procedures are guided by its personnel regulations and the “Remuneration Committee Charter.” Director and employee remuneration, detailed in “Articles of Incorporation,” is reviewed by the “Remuneration Committee,” approved by the Board, and reported at the shareholders’ meeting. Director and executive pay is aligned with industry standards, individual and Company performance, and future risk exposure. Employee compensation considers industry standards, talent competition, overall performance, profitability, budget planning, performance reviews, occupational safety, environmental indicators, market planning, and future operational risks. The Payroll Section of the HR Dept. assesses directors' compensation annually based on performance evaluations, linking it to sustainable performance, as follows:

• Establish the Company’s core values (discipline, mission, honor, vision) and strategic goals.
• Integrate risk assessment and control into the Company’s decision-making process.
• Regularly assess and monitor risks, and review the internal control system’s effectiveness.
• Conduct regular and effective evaluations of the Board, its members, and functional committees.
• Oversee the accounting system, financial status, reports, and audit findings, including follow-up actions.

Conflict of Interest Management

Unimicron’s “Rules and Procedures of Board of Directors Meetings,” “Audit Committee Charter,” and “Remuneration Committee Charter” outline conflict-of-interest provisions. Directors with a personal or representative interest in meeting matters must disclose this interest. If there is a risk of harm to the Company’s interests, the director must abstain from participating in discussions and voting, and cannot act as a proxy for other directors.

Functional Committee

To support the Board in its supervisory, audit, and management roles, we established the Audit Committee, Remuneration Committee, and Business Continuity and Nomination Committee. These committees effectively perform their duties and oversee management responsibilities. Details on committee members and major resolutions are available in the 2023 Annual Report: Remuneration Committee on Pages 35-36, Audit Committee on Pages 22-23, and Business Continuity and Nomination Committee on Page 37.

Internal Control

Unimicron’s Audit Office develops audit plans based on annual enterprise risks, conducting both routine and ad-hoc internal audits and controls. The office includes an audit officer and 8 full-time auditors. In 2023, auditors attended 18 courses from accredited educational institutions and participated in 108 hours of meetings and seminars hosted by the Association of Internal Auditors and the Association of Computer Auditors.