| Evaluation Item |
Implementation Status |
| Yes |
No |
Abstract Illustration |
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| A. |
Ownership Structure and Shareholders' Equity |
- Does the Bank establish an internal operating procedure to deal with shareholders’ suggestions, doubts, disputes and litigations, and implement based on the procedure?
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- The Bank is a 100% owned subsidiary of Mega Financial Holding Company (“Mega FHC”). The Bank’s operation and management, financial business information and audit management are handled in accordance with the “Regulations on Supervision of Mega FHC’s Subsidiaries”. Recommendations or questions regarding the Bank’s operations may be conveyed through formal letters, telephones, emails, etc. The Bank’s business supervisory units will handle or explain the case, in accordance to the internal operating procedures.
- Mega FHC is the Bank’s sole shareholder. Any shareholders’ dispute or litigation shall be handled by the supervisory units. However, if it is necessary to engage a lawyer, the units, according to the Bank’s “Directions for Handling Legal Cases”, shall request for approval from the authorized level before engaging a lawyer.
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- Does the Bank possess the identities of its major shareholders as well as the ultimate owners of those shares?
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- Mega FHC is the Bank’s sole shareholder and ultimate controller.
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- Does the Bank establish and execute the risk management and firewall system within its conglomerate structure?
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The responsibilities for the management and risk control mechanism of assets and financial matters of the Bank and affiliated companies are completely independent; and tight firewall mechanisms are established and executed.
- Information security: The internet between the Bank and affiliated companies is connected directly through peer-to-peer which is the safest way of internet connection, and controlled by Firewall to avoid unauthorized connection.
- Client confidentiality: An internal control process has been set for person in charge of processing, using customer information and entering and removing customers’ personal particulars, and a post-execution supervision mechanism is in place to ensure the appropriateness of authorization.
- Stakeholder transactions: The Bank has established “Related Party Transaction Principles”. Also, in accordance with the relevant laws and regulations, the stakeholder transaction balance is submitted to the parent company, Mega FHC, regularly. Mega FHC then discloses the related information and submits it to the competent authority.
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| B. |
Composition and Responsibilities of the Board of Directors |
- Has the Board of Directors established a diversity policy and specific management objectives?
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- The Bank’s sole institutional shareholder supports on the diversity, professional background, and experiences of the Board of Directors.
- By the end of 2022, the Bank’s 17th Board of Directors consists of thirteen directors and five supervisors, one (7.7%) of whom is bank employees and three (16.67%) of whom are female. The average age of the members is 60.39 years.
- The Board of Directors comprises members from different backgrounds in the financial industry, government agencies, industrial circles, and academia, including lawyers, accountants, financial scholars, and IT network specialists. Their professional backgrounds and experiences cover law, accounting, industrial economics, tax administration, financial management, FinTech, and online payment. The members’ professional skills consist of business management, risk management, regulatory compliance, anti-money laundering, internal control, finance and banking, economic analysis, knowledge in industrial finance, ESG and corporate sustainability, etc.
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- Does the Bank voluntarily establish other functional committees in addition to the Remuneration Committee and the Audit Committee?
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- After joining Mega FHC, the Bank is delisted from the stock market and is not mandatory to set up a Remuneration Committee. The design and adjustment of the Bank’s remuneration is submitted to Mega FHC for approval.
- Mega FHC has set up an Audit Committee. According to the regulations issued by Financial Supervisory Commission, a financial institution 100% owned by a financial holding company may choose to set up an audit committee or appoint supervisors, and the Bank has adopted the latter. The Bank’s supervisors may communicate with the Bank’s employees, head of internal audit and shareholders at any time, and convene supervisors meetings from time to time, with the attendance of a CPA where necessary.
- The Bank has set up the committees under the Board of Directors, including the Risk Management Committee, Compliance Committee, Compliance Action Committee, and Ethical Management Committee, and the related minutes were reported to the Board of Directors to grasp the Bank’s business plan and important policies and effectively supervise the management.
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- Has the listed bank established and implemented methods for assessing the performance of the Board of Directors, conducted performance evaluation annually, presented the performance evaluation results to the Board of Directors, and used the results as reference for remuneration and re-election nominations of individual director?
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- The Bank is not listed and not traded OTC and is a 100% owned subsidiary of Mega FHC.
- In order to establish a sound corporate governance system, the Bank formulated the “Corporate Governance Best Practice Principles”which includes detailed regulations about the operation of the Board of Directors to build an effective corporate governance framework. Reference was made to the relevant provisions of the “Corporate Governance Best Practice Principles for Banks” promulgated by the Bankers Association of the Republic of China.
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- Does the company regularly evaluate the independence of CPAs?
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- When appointing a CPA, the Bank shall assess its independence and request it to provide “Independence Declaration on the Auditing and Attestation of Financial Report by the Certified Public Accountant”.
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| C. |
Has the Bank established adequate number of competent corporate governance personnel and officer who are in charge of corporate governance-related matters (including but not limited to providing information for directors and supervisors to perform their functions, assisting directors and supervisors in complying with laws and regulations, handling matters related to Board meetings and shareholders’ meetings according to the law, and producing minutes of the Board meetings and shareholders’ meetings, etc.)? |
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- The Bank has a chief corporate governance officer and relevant personnel of corporate governance to deal with the related affairs. The Bank’s General Affairs and Occupational Safety & Health Department is in charge of matters related to company registration and registration change. The Secretarial Unit of the Bank’s Board of Directors is in charge of matters related to the board of directors meetings, providing information regarding professional practice to directors and supervisors, and according to the requirements or regulations of the competent authority, notifying the directors and supervisors of relevant laws and regulations, restrictions or precautions in a timely manner, and cooperating in formulating internal relevant norms, such as the code of conduct for directors, the management guidelines for concurrent office-holding of persons-in-charge and the guidelines for the scope of duties of independent directors, so as to facilitate the compliance with laws and regulations.
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| D. |
Does the Bank set up channels of communication for stakeholders (including but not limited to shareholders, employees, customers and suppliers), dedicated a section of the company’s website for stakeholder affairs and adequately responded to stakeholders’ inquiries on significant corporate social responsibility issues? |
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- The Bank’s website provides service or complaint channels such as contact email and customer service hotline, as well as disclosure of legal issues, including information related to related party transactions, whistle-blowing channel, shareholder area , etc. Additionally, there is fair principle area for customers, consumers, related parties and employees to keep in touch with the Bank, inquire and use relevant information.
- In terms of communicating with interested parties defined in The Banking Act and Financial Holding Company Act, the Bank’s Head Office request all unites to check the interested parties list every three months and after being confirmed by the related interested parties, the interested parties profile shall be maintained in the Bank's e-Loan System and Mega FHC’s network information system. Should there be any change in the duties of the interested parties, the person concerned shall be communicated, and the profile updated immediately.
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| E. |
Information Disclosure |
- Does the Bank have a corporate website to disclose both financial standings and the status of corporate governance?
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- The Bank’s official website (https://www.megabank.com.tw) is maintained by dedicated personnels regularly to disclose information regarding the Bank’s business, financials and corporate governance.
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- Does the Bank have other information disclosure channels (e.g. building an English website, appointing designated people to handle information collection and disclosure, creating a spokesman system, webcasting investor conferences)?
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- The Bank’s official website has an English version, https://www.megabank.com.tw/en-us/english/index/ and is maintained regularly.
- If there’s information needed to be made public in accordance with the relevant laws and regulations, the Bank shall, within the legal time limit, designate a personnel to report and disclose immediately.
- The Bank has established “Procedures for Releasing Information by Spokesperson and Acting Spokesperson”. The Spokesperson and Deputy Spokesperson speak publicly on behalf of the Bank by means of press release, website disclosure or disclosure of information.
- The investor conference is handled by the parent company, Mega FHC.
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- Does the Bank disclose its annual financial report at the end of the accounting year within the prescribed time limit in accordance with the Banking Act and the Securities and Exchange Act, and publicly disclose its Q1, Q2, and Q3 financial reports and monthly operation status ahead of the prescribed time limit?
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- In addition to making public announcement in accordance with Article 36 of the Securities and Exchange Act and relevant decrees, the Bank also publishes individual financial business information on the Bank’s website within three months after the end of each fiscal year, within two months after the end of each half year and within 45 days after the end of the first quarter and the third quarter in accordance with Article 32 of the Regulations Governing the Preparation of Financial Reports by Public Banks.
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| F. |
Is there any other important information to facilitate a better understanding of the Bank’s corporate governance practices (e.g., including but not limited to employee rights, employee wellness, investor relations, rights of stakeholders, directors’ and supervisors’ training records, the implementation of risk management policies and risk evaluation measures, the implementation of customer relations policies, and purchasing insurance for directors and supervisors, and donations to political parties, stakeholders, and charity organizations)? |
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- Employees’ rights: The Bank shall inform the employees in advance of any job relocation. If the change of business nature results in no suitable jobs for the employee, or the employee is incompetent in taking up the job, the Bank shall, according to the Labor Standards Act, inform the employee in advance of the termination of employment contract at least 10 to 30 days. In addition, the Bank and the Union have established a collective agreement. The Bank has set up the Personnel Appraisal Committee, formed by the Bank and union representatives, responsible for the review of awards and penalties of the employees. It has also established the Occupational Safety & Health Committee, responsible for the planning and handling, review and supervision of matters related to labor safety, hygiene and health. Employees’ Retirement Fund Supervisory Committee is also set up to safeguard employees’ pension.
- Employee welfare: The Bank has set up the Employee Welfare Committee, responsible for the review and planning of employee welfare services and fund allocation. In addition, in accordance with the “Directions Governing Implementation of Employee Health Examination” of the Bank, to ensure employees’ overall well-being, the Bank provides regular health checks for all employees and holds quarterly videoconferences on health-related topics to raise health awareness among employees.
- Investor relationship: The Bank is fully answerable to its parent company, Mega FHC, for its business performance.
- Directors to recuse themselves from cases in which they have a material interest: As per Rules and Procedures of shareholders meeting of the Bank, interested parties with respect to proposals shall recuse themselves from discussions or voting to avoid the conflict of interest.
- Advanced studies of directors and supervisors: the Bank provides directors and supervisors with opportunities enhancing their professional competency.
- Execution of customer policies: According to the various regulations of the competent authority and bank union, the Bank shall state in the contract, regulations to be complied, whereby customers can claim the right based on the contracts.
- Purchasing liability insurance for directors and supervisors: The Bank purchases “Directors’ and Officers’ Liability and Company Reimbursement Insurance” for all directors and supervisors.
- Donations: The Bank has, over the years, organized various activities and donated to charities and non-profit organizations. The donation process strictly complies with the various internal and external laws and regulations.
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