Chapter I General Principles
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| Article 1 | In order to assist companies listed on the Taiwan Stock Exchange Corporation ("TWSE") and Taipei Exchange ("TPEx") (collectively referred to as "TWSE/TPEx listed companies") to fulfill their corporate social responsibility initiatives and to promote economic, environmental, and social advancement for purposes of sustainable development, the TWSE and TPEx hereby jointly adopt the Principles to be followed by TWSE/TPEx listed companies.
TWSE/TPEx listed companies are advised to promulgate their own sustainable development principles in accordance with the Principles to manage their economic, environmental and social risks and impact.
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| Article 2 | The Principles apply to TWSE/TPEx listed companies, including the entire operations of each such company and its business group.
The Principles encourage TWSE/TPEx listed companies to actively fulfill sustainable development in the course of their business operations so as to follow international development trends and to contribute to the economic development of the country, to improve the quality of life of employees, the community and society by acting as responsible corporate citizens, and to enhance competitive edges built on sustainable development.
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| Article 3 | In promoting sustainable development initiatives, TWSE/TPEx listed companies shall, in its corporate management guidelines and business operations, give due consideration to the rights and interests of stakeholders and, while pursuing sustainable operations and profits, also give due consideration to the environment, society and corporate governance.
TWSE/TPEx listed companies shall, in accordance with the materiality principle, conduct risk assessments of environmental, social and corporate governance issues pertaining to company operations and establish the relevant risk management policy or strategy.
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| Article 4 | To implement sustainable development initiatives, TWSE/TPEx listed companies are advised to follow the principles below:
- Exercise corporate governance.
- Foster a sustainable environment.
- Preserve public welfare.
- Enhance disclosure of corporate sustainable development information.
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| Article 5 | TWSE/TPEx listed companies shall take into consideration the correlation between the development of domestic and international sustainable development issues and corporate core business operations, and the effect of the operation of individual companies and of their respective business groups as a whole on stakeholders, in establishing their policies, systems or relevant management guidelines, and concrete promotion plans for sustainable development programs, which shall be approved by the board of directors and then reported to the shareholders meeting.
When a shareholder proposes a motion involving sustainable development, the company's board of directors is advised to review and consider including it in the shareholders meeting agenda.
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Chapter 2 Exercising Corporate Governance
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| Article 6 | TWSE/TPEx listed companies are advised to follow the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies, the Ethical Corporate Management Best Practice Principles for TWSE/TPEx Listed Companies, and the Code of Ethical Conduct for TWSE/TPEx Listed Companies to establish effective corporate governance frameworks and relevant ethical standards so as to enhance corporate governance.
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| Article 7 | The directors of a TWSE/TPEx listed company shall exercise the due care of good administrators to urge the company to perform its sustainable development initiatives, examine the results of the implementation thereof from time to time and continually make adjustments so as to ensure the thorough implementation of its sustainable development policies.
The board of directors of a TWSE/TPEx listed company is advised to give full consideration to the interests of stakeholders, including the following matters, in the company's furtherance of its sustainable development objectives:
- Identifying the company's sustainable development mission or vision, and declaring its sustainable development policy, systems or relevant management guidelines;
- Making sustainable development the guiding principle of the company's operations and development, and ratifying concrete promotional plans for sustainable development initiatives; and
- Enhancing the timeliness and accuracy of the disclosure of sustainable development information.
The board of directors shall appoint executive-level positions with responsibility for economic, environmental, and social issues resulting from the business operations of a TWSE/TPEx listed company, and to report the status of the handling to the board of directors. The handling procedures and the responsible person for each relevant issue shall be concrete and clear.
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| Article 8 | TWSE/TPEx listed companies are advised to, on a regular basis, organize education and training on the promotion of sustainable development initiatives, including promotion of the matters prescribed in paragraph 2 of the preceding article.
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| Article 9 | For the purpose of managing sustainable development initiatives, TWSE/TPEx listed companies are advised to create a governance structure for promotion of sustainable development, and establish an exclusively (or concurrently) dedicated unit to be in charge of proposing and enforcing the sustainable development policies, systems, or relevant management guidelines, and concrete promotional plans and to report on the same to the board of directors on a periodic basis.
TWSE/TPEx listed companies are advised to adopt reasonable remuneration policies, to ensure that remuneration arrangements support the strategic aims of the organization, and align with the interests of stakeholders.
It is advised that the employee performance evaluation system be combined with sustainable development policies, and that a clear and effective incentive and discipline system be established.
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| Article 10 | TWSE/TPEx listed companies shall, based on respect for the rights and interests of stakeholders, identify stakeholders of the company, and establish a designated section for stakeholders on the company website; understand the reasonable expectations and demands of stakeholders through proper communication with them, and adequately respond to the important sustainable development issues which they are concerned about.
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Chapter 3 Fostering a Sustainable Environment
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| Article 11 | TWSE/TPEx listed companies shall follow relevant environmental laws, regulations and international standards to properly protect the environment and shall endeavor to promote a sustainable environment when engaging in business operations and internal management.
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| Article 12 | TWSE/TPEx listed companies are advised to endeavor to utilize energy more efficiently and use renewable materials which have a low impact on the environment to improve sustainability of natural resources.
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| Article 13 | TWSE/TPEx listed companies are advised to establish proper environment management systems based on the characteristics of their industries. Such systems shall include the following tasks:
- Collecting sufficient and up-to-date information to evaluate the impact of the company's business operations on the natural environment.
- Establishing measurable goals for environmental sustainability, and examining whether the development of such goals should be maintained and whether it is still relevant on a regular basis.
- Adopting enforcement measures such as concrete plans or action plans, and examining the results of their operation on a regular basis.
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| Article 14 | TWSE/TPEx listed companies are advised to establish a dedicated unit or assign dedicated personnel for drafting, promoting, and maintaining relevant environment management systems and concrete action plans, and should hold environment education courses for their managerial officers and other employees on a periodic basis.
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| Article 15 | TWSE/TPEx listed companies are advised to take into account the effect of business operations on ecological efficiency, promote and advocate the concept of sustainable consumption, and conduct research and development, procurement, production, operations, and services in accordance with the following principles to reduce the impact on the natural environment and human beings from their business operations:
- Reduce resource and energy consumption of their products and services.
- Reduce emission of pollutants, toxins and waste, and dispose of waste properly.
- Improve recyclability and reusability of raw materials or products.
- Maximize the sustainability of renewable resources.
- Enhance the durability of products.
- Improve efficiency of products and services.
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| Article 16 | To improve water use efficiency, TWSE/TPEx listed companies shall properly and sustainably use water resources and establish relevant management measures.
TWSE/TPEx listed companies shall construct and improve environmental protection treatment facilities to avoid polluting water, air and land, and use their best efforts to reduce adverse impact on human health and the environment by adopting the best practical pollution prevention and control measures.
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| Article 17 | TWSE/TPEx listed companies are advised to assess the current and future potential risks and opportunities that climate change may present to enterprises and to adopt related measures.
TWSE/TPEx listed companies are advised to adopt standards or guidelines generally used in Taiwan and abroad to enforce corporate greenhouse gas inventory and to make disclosures thereof, the scope of which shall include the following:
- Direct greenhouse gas emissions: emissions from operations that are owned or controlled by the company.
- Indirect greenhouse gas emissions: emissions resulting from the utilization of energy such as imported electricity, heating, or steam.
- Other indirect emissions: emissions resulting from corporate activities that are not indirect emissions from energy, but are from other sources of emissions owned or controlled by the company.
TWSE/TPEx listed companies are advised to compile statistics on greenhouse gas emissions, volume of water consumption and total weight of waste and to establish policies for energy conservation, carbon and greenhouse gas reduction, reduction of water consumption or management of other wastes. The companies’ carbon reduction strategies should include obtaining carbon credits and be promoted accordingly to minimize the impact of their business operations on climate change.
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Chapter 4 Preserving Public Welfare
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| Article 18 | TWSE/TPEx listed companies shall comply with relevant laws and regulations, and the International Bill of Human Rights, with respect to rights such as gender equality, the right to work, and prohibition of discrimination.
A TWSE/TPEx listed company, to fulfill its responsibility to protect human rights, shall adopt relevant management policies and processes, including:
- Presenting a corporate policy or statement on human rights.
- Evaluating the impact of the company's business operations and internal management on human rights, and adopting corresponding handing processes.
- Reviewing on a regular basis the effectiveness of the corporate policy or statement on human rights.
- In the event of any infringement of human rights, the company shall disclose the processes for handling of the matter with respect to the stakeholders involved.
TWSE/TPEx listed companies shall comply with the internationally recognized human rights of labor, including the freedom of association, the right of collective bargaining, caring for vulnerable groups, prohibiting the use of child labor, eliminating all forms of forced labor, eliminating recruitment and employment discrimination, and shall ensure that their human resource policies do not contain differential treatments based on gender, race, socioeconomic status, age, or marital and family status, so as to achieve equality and fairness in employment, hiring conditions, remuneration, benefits, training, evaluation, and promotion opportunities.
TWSE/TPEx listed companies shall provide an effective and appropriate grievance mechanism with respect to matters adversely impacting the rights and interests of the labor force, in order to ensure equality and transparency of the grievance process. Channels through which a grievance may be raised shall be clear, convenient, and unobstructed. A company shall respond to any employee's grievance in an appropriate manner.
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| Article 19 | TWSE/TPEx listed companies shall provide information for their employees so that the employees have knowledge of the labor laws and the rights they enjoy in the countries where the companies have business operations.
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| Article 20 | TWSE/TPEx listed companies are advised to provide safe and healthful work environments for their employees, including necessary health and first-aid facilities and shall endeavor to curb dangers to employees' safety and health and to prevent occupational accidents.
TWSE/TPEx listed companies are advised to organize training on safety and health for their employees on a regular basis.
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| Article 21 | TWSE/TPEx listed companies are advised to create an environment conducive to the development of their employees' careers and establish effective training programs to foster career skills.
TWSE/TPEx listed companies shall establish and implement reasonable employee welfare measures (including remuneration, leave and other welfare etc.) and appropriately reflect the business performance or achievements in the employee remuneration, to ensure the recruitment, retention, and motivation of human resources, and achieve the objective of sustainable operations.
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| Article 22 | TWSE/TPEx listed companies shall establish a platform to facilitate regular two-way communication between the management and the employees for the employees to obtain relevant information on and express their opinions on the company's operations, management and decisions.
TWSE/TPEx listed companies shall respect the employee representatives' rights to bargain for the working conditions, and shall provide the employees with necessary information and hardware equipment, in order to improve the negotiation and cooperation among employers, employees and employee representatives.
TWSE/TPEx listed companies shall, by reasonable means, inform employees of operation changes that might have material impacts.
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| Article 22-1 | A TWSE/TPEx listed company is advised to treat customers or consumers of its products or services in a fair and reasonable manner, including according to the following principles: fairness and good faith in contracting, duty of care and fiduciary duty, truthfulness in advertising and soliciting, fitness of products or services, notification and disclosure, commensuration between compensation and performance, protection of the right to complain, professionalism of salespersons etc. Said company shall also develop the relevant strategies and specific measures for implementation.
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| Article 23 | TWSE/TPEx listed companies shall take responsibility for their products and services, and take marketing ethics seriously. In the process of research and development, procurement, production, operations, and services, the company shall ensure the transparency and safety of their products and services. They further shall establish and disclose policies on consumer rights and interests, and enforce them in the course of business operations, in order to prevent the products or services from adversely impacting the rights, interests, health, or safety of consumers.
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| Article 24 | TWSE/TPEx listed companies shall ensure the quality of their products and services by following the laws and regulations of the government and relevant standards of their industries.
TWSE/TPEx listed companies shall follow relevant laws, regulations and international guidelines in regard to customer health and safety and customer privacy involved in, and marketing and labeling of, their products and services and shall not deceive, mislead, commit fraud or engage in any other acts which would betray consumers' trust or damage consumers' rights or interests.
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| Article 25 | TWSE/TPEx listed companies are advised to evaluate and manage all types of risks that could cause interruptions in operations, so as to reduce the impact on consumers and society.
TWSE/TPEx listed companies are advised to provide a clear and effective procedure for accepting consumer complaints to fairly and timely handle consumer complaints, shall comply with laws and regulations related to the Personal Information Protection Act for respecting consumers' rights of privacy and shall protect personal data provided by consumers.
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| Article 26 | TWSE/TPEx listed companies are advised to assess the impact their procurement has on society as well as the environment of the community that they are procuring from, and shall cooperate with their suppliers to jointly implement the corporate social responsibility initiative.
TWSE/TPEx listed companies are advised to establish supplier management policies and request suppliers to comply with rules governing issues such as environmental protection, occupational safety and health or labor rights. Prior to engaging in commercial dealings, TWSE/TPEx listed companies are advised to assess whether there is any record of a supplier's impact on the environment and society, and avoid conducting transactions with those against corporate social responsibility policy.
When TWSE/TPEx listed companies enter into a contract with any of their major suppliers, the content should include terms stipulating mutual compliance with corporate social responsibility policy, and that the contract may be terminated or rescinded any time if the supplier has violated such policy and has caused significant negative impact on the environment and society of the community of the supply source.
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| Article 27 | TWSE/TPEx listed companies shall evaluate the impact of their business operations on the community, and adequately employ personnel from the location of the business operations, to enhance community acceptance.
TWSE/TPEx listed companies are advised to, through equity investment, commercial activities, endowments, volunteering service or other charitable professional services etc., dedicate resources to organizations that commercially resolve social or environmental issues, participate in events held by citizen organizations, charities and local government agencies relating to community development and community education to promote community development.
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| Article 27-1 | TWSE/TPEx listed companies are advised to dedicate resources to cultural and art activities or the cultural and creative industry constantly through donations, sponsorships, investments, procurements, strategic cooperation, corporate volunteering of technical support, or other supporting means, to promote cultural development.
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Chapter 5 Enhancing Disclosure of Sustainable Development Information
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| Article 28 | TWSE/TPEx listed companies shall disclose information according to relevant laws, regulations and the Corporate Governance Best Practice Principles for TWSE/TPEx listed Companies and shall fully disclose relevant and reliable information relating to their sustainable development initiatives to improve information transparency.
Relevant information relating to sustainable development which TWSE/TPEx listed companies shall disclose includes:
- The policy, systems or relevant management guidelines, and concrete promotion plans for sustainable development initiatives, as resolved by the board of directors.
- The risks and the impact on the corporate operations and financial condition arising from exercising corporate governance, fostering a sustainable environment and preserving social public welfare.
- Goals and measures for promoting the sustainable development initiatives established by the companies, and performance in implementation.
- Major stakeholders and their concerns.
- Disclosure of information on major suppliers' management and performance with respect to major environmental and social issues.
- Other information relating to sustainable development initiatives.
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| Article 29 | TWSE/TPEx listed companies shall adopt internationally widely recognized standards or guidelines when producing sustainability reports, to disclose the status of their implementation of the sustainable development policy. It also is advisable to obtain a third-party assurance or verification for reports to enhance the reliability of the information in the reports. The reports are advised to include:
- The policy, system, or relevant management guidelines and concrete promotion plans for implementing sustainable development initiatives.
- Major stakeholders and their concerns.
- Results and a review of the exercising of corporate governance, fostering of a sustainable environment, preservation of public welfare and promotion of economic development.
- Future improvements and goals.
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Chapter 6 Supplementary Provisions |
| Article 30 | TWSE/TPEx listed companies shall at all times monitor the development of domestic and foreign sustainable development standards and the change of business environment so as to examine and improve their established sustainable development framework and to obtain better results from the promotion of the sustainable development policy.
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