Chapter IV Empowering Supervisors
|
Section 1 Functions of Supervisors
|
| Article 41 | A TWSE/TPEx listed company shall stipulate a fair, just, and open procedure for the election of supervisors, and shall adopt a cumulative voting mechanism pursuant to the Company Act to fully reflect the opinions of the shareholders.
A TWSE/TPEx listed company shall take into consideration the needs of overall business operations and comply with the rules of the TWSE or TPEx in setting the minimum number of supervisors.
The aggregate shareholding percentage of all of the supervisors of a TWSE/TPEx listed company shall comply with laws and regulations. Restrictions on share transfers by each supervisor and the creation, release, or changes in pledges of shares held by each supervisor shall comply with the relevant laws and regulations, and the relevant information shall be fully disclosed.
|
|
| Article 42 | (Specification in the articles of incorporation the adoption of the candidate nomination system for elections of supervisors)
A TWSE/TPEx listed company shall specify in its articles of incorporation in accordance with the laws and regulations of the competent authorities that it adopts the candidate nomination system for elections of supervisors, carefully review the qualifications of a nominated candidate and the existence of any other matters set forth in Article 30 of the Company Act, and act in accordance with Article 192-1 of the Company Act.
|
Info |
| Article 43 | Unless otherwise approved by the competent authority, at least one supervisor seat shall have no spousal relationship or familial relationship within the second degree of kinship with another supervisor or a director.
A TWSE/TPEx listed company is advised to refer to the provisions on independence provided in the Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies and appoint a suitable supervisor to enhance the risk management and financial and operational control of the company.
A supervisor will preferably be domiciled within the territory of the ROC to allow timely performance of supervisory functions.
|
|
Section 2 Powers and Obligations of Supervisors |
| Article 44 | A supervisor shall be familiar with the relevant laws and regulations, and shall understand the rights, obligations, and duties of directors of the company and the functions, duties, and operation of each department. A supervisor shall attend meetings of the board of directors to supervise their operations and to state his/her opinions when appropriate so as to grasp or discover any abnormal situation early on.
A TWSE/TPEx listed company shall stipulate the supervisor's remuneration in its articles of incorporation or by an approval in a shareholders meeting.
|
|
| Article 45 | A supervisor shall supervise the implementation of the operations of the company, and the performance of duties by directors and managers, and care the enforcement of the internal control system so as to reduce the financial and operational risks of the company.
Where a director, for himself/herself or on behalf of others, enters into a sale/purchase or loan transaction, or conducts any legal act with the company, a supervisor shall act as the representative of the company. In the event that the company has set up an audit committee, an independent director member of the audit committee shall act as the representative of the company in the above situation.
|
|
| Article 46 | A supervisor may investigate the operational and financial conditions of the company from time to time, and the relevant departments in the company shall provide the books or documents that will be needed for the supervisor's review, transcription or duplication.
When reviewing the finance or operations of the company, a supervisor may retain attorneys or CPAs on behalf of the company to perform the review; however, the company shall inform the relevant persons of their confidentiality obligations.
The board of directors or managers shall submit reports in accordance with the request of the supervisors and shall not for any reason circumvent, obstruct, or refuse the inspection of the supervisor.
When a supervisor performs his/her duties, a TWSE/TPEx listed company shall provide necessary assistance as needed by the supervisor, and the reasonable expenses that the supervisor needs shall be borne by the company.
|
|
| Article 47 | For supervisors to timely discover any possible irregular conduct in the company, a TWSE/TPEx listed company shall establish a channel for supervisors to communicate with the employees, shareholders, and stakeholders.
Upon discovering any irregular conduct, a supervisor shall take appropriate measures timely to curb the expansion of the irregular conduct, and file a report to the relevant regulatory authorities or agencies if necessary.
When an independent director or general manager, an officer of the finance, accounting, research and development, or internal audit department, or a CPA resigns or is removed from his/her position, the supervisors shall investigate the reasons.
In the event that a supervisor neglects his/her duties and therefore causes harm to the company, the supervisor shall be liable to the company.
|
|
| Article 48 | When exercising his/her supervisory power, each supervisor of a TWSE/TPEx listed company may, after taking into consideration the overall interest of the company and shareholders, convene a meeting to exchange opinions among all the supervisors when he or she feels necessary, but in so doing may not obstruct supervisors in exercising their duties.
|
|
| Article 49 | A TWSE/TPEx listed company shall take out supervisors liability insurance with respect to liabilities resulting from the exercise of duties during their terms, so as to reduce and spread the risk of material harm to the company and shareholders arising from the wrongdoing or negligence of a supervisor.
A TWSE/TPEx listed company is advised to report the insured amount, coverage, premium rate, and other major contents of the liability insurance it has taken out or renewed for supervisors, at the next board meeting.
|
|
| Article 50 | Upon becoming supervisors and throughout their terms, supervisors are advised to participate in training courses on finance, risk management, business, commerce, accounting, law or corporate social responsibility offered by institutions designated in the Rules Governing Implementation of Continuing Education for Directors and Supervisors of TWSE/TPEx Listed Companies covering subjects relating to corporate governance.
|
|