Chapter III Enhancing the Function of Board of Director
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Section 1 Structure of Board of Directors
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| Article 20 | The board of directors of a securities firm shall direct the company's strategies, supervise the management and be responsible to the company and shareholders. Procedures and arrangement relating to corporate governance shall ensure that, in exercising its authority, the board of directors will comply with laws, regulations, articles of incorporation, and the resolutions of shareholders' meetings of the company.
Regarding the structure of the board of directors of a securities firm, an appropriate number of the board members, which shall not be less than five, shall be determined based on the review of the scale of corporate management and operation and the shareholding of the major shareholders and by taking into consideration of the practical needs for operation. If independent directors are to be appointed, reasonable professional qualifications and objective conditions on how these directors may exercise powers independently shall be carefully reviewed.
The board of directors shall have members of diverse backgrounds. No more than one third of the directors may act as the company's managers at the same time. The board of directors shall formulate appropriate and diverse strategies based on how the board works, type of operation, and development needs, for which standards covering at least the following two aspects shall be included:
- Basic qualifications and value: such as gender, age, nationality and culture.
- Professional knowledge and skills: including professional background, such as law, accounting, industry, finance, marketing or technology, professional skills and industrial experience.
The board members shall have the necessary knowledge, skill, and experience for performing their duties. To achieve the ideal goal of corporate governance, the board of directors shall have the following abilities:
- ability to make operational judgment;
- ability to perform accounting and financial analysis;
- ability to conduct management administration;
- ability to conduct crisis management;
- possession of securities and financial derivatives products professional knowledge;
- possession of perspective of international market;
- ability to lead; and
- ability to make decisions.
- possession of knowledge of and ability for risk management.
The board of directors shall be aware of the securities firm's operational risk exposure, such as market risk, credit risk, liquidity risk, operational risk, legal risk, reputation risk, and other types of risk relating to the securities firm's operation, to ensure effectiveness of risk management and shall be ultimately responsible for risk management.
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| Article 20-1 | To achieve the goal of corporate governance, the board of directors of a securities firm has the following main job responsibilities:
- Establish an effective and appropriate internal control system.
- Elect and supervise managers.
- Review the company's management policy-making and operation plan, and supervise its execution.
- Review the company's financial objectives and supervise how they are accomplished.
- Supervise the results of the company's operation.
- Standards for performance evaluations and emoluments for managers and salespersons, and the structure and system of directors' emoluments.
- Supervise and handle the risks the company is facing.
- Ensure the company's compliance of applicable laws.
- Plan for the company's future objectives.
- Create and maintain the company's image and make the company a responsible member of the society.
- Elect accountants, lawyers and other experts.
- Protect investors' rights and interests.
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| Article 21 | A securities firm shall follow the principle of protecting shareholders' rights and interests and treating all shareholders equally to incorporate a fair, just, and open procedure for the election of directors, encourage shareholders' participation, and adopt the cumulative voting mechanism in order to fully reflect shareholders' views in accordance with the regulations of the Company Act.
Unless otherwise authorized by the competent authority, for the majority of the board of directors of a securities firm, no two board members may be relatives within two degrees of consanguinity.
If the number of directors become less than five after the dismissal of one or more directors for any reason, the company shall reelect new directors at the next shareholders' meeting. If, however, a third of or more seats at the board of directors, based on the number of directors specified in the articles of incorporation, become vacant, the company shall convene a special shareholders' meeting for reelection within 60 days of occurrence of the dismissal.
The aggregate shareholding percentage of all of the directors of a securities firm shall comply with the laws and regulations. Restrictions on the share transfer of each director and the creation, release, or changes of any pledges over the shares held by each director shall be subject to the relevant laws and regulations, and the relevant information shall be fully disclosed.
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| Article 22 | A securities firm is advised to state in its articles of incorporation in accordance with the Company Act that the candidate nomination system shall be adopted for election of its directors, to assess carefully the qualifications of the nominees, and to ascertain whether any of the circumstances set forth in Article 30 of the Company Act and Article 53 of the Securities and Exchange Act applies with respect to the nominees, so that qualified directors will be elected. Said firm shall also abide by Article 192-1 of the Company Act.
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| Article 23 | Clear distinctions shall be drawn between the responsibilities and duties of the chairman of the board of a securities firm and those of its general manager.
It is not advisable for the offices of chairperson and general manager or other comparable post to be assumed by the same person, unless otherwise approved by the competent authority in accordance with the Regulations Governing Responsible Persons and Salespersons of Securities Firms. If the chairman also acts as the general manager or they are spouses or relatives within one degree of consanguinity, it would be advisable that the number of independent directors be increased.
Where a securities firm has set up a functional committee, it shall specify the powers and duties of the committee.
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Section 2 Independent Directors
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| Article 24 | A securities firm that has appointed two or more independent directors in accordance with the articles of incorporation shall keep the number of its independent directors not less than one-fifth of number of seats at the board of directors.
Independent directors shall have expertise and required knowledge, and are subject to restrictions on shareholding. In addition to abiding by the applicable laws and regulations, they are also advised not to act as a director (including independent director) or supervisor of more than five companies concurrently. They shall maintain their independence when performing duties, and shall not have any direct or indirect interest in the company.
No independent directors of a securities firm may hold the position for more than three consecutive terms.
During their incumbency, no independent directors or non-independent directors may switch roles with each other.
Professional qualifications, restrictions on shareholding and outside employment, determination of independence, method of nomination and other regulations for compliance with regard to independent director shall be governed by the Securities and Exchange Act, the Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies, and the regulations of Taiwan Stock Exchange or Taipei Exchange.
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| Article 25 | A securities firm shall, in accordance with the regulations of the Securities and Exchange Act, have the following matters resolved at the board of directors. Adverse opinion or qualified opinion, if any, expressed by independent director shall be stated in the board of directors' meeting minutes:
- Establishment of or modification to the internal control system in accordance with Article 14-1 of the Securities and Exchange Act.
- Establishment of and modification to the procedures of major financial and business activities such as acquisition or disposal of assets, performance of transactions of derivatives, lending of funds to third parties, granting of endorsements and provision of guarantees in accordance with Article 36-1 of the Securities and Exchange Act.
- Matters involving interests pertaining to directors or supervisors themselves.
- Major transactions of assets or derivatives.
- Major lending of funds, endorsement or provision of guarantee.
- Offering, issuance or private placement of securities of the nature of equity.
- Appointment,dismissal or remuneration of certified public accountant.
- Appointment and dismissal of chief financial, accounting, risk management, compliance and internal audit officers.
- Standards for performance evaluations and emoluments for managers and salespersons.
- Structure and system of directors' emoluments.
- Other major issues specified by the competent authority.
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| Article 26 | A securities firm shall stipulate expressly the scope of duties of the independent directors and empower them with manpower and material support related to the exercise of their power. The company or other board members shall not restrict, obstruct, reject, or evade the performance of duties by the independent directors.
A securities firm shall, in accordance with the applicable laws and regulations, stipulate expressly the emoluments of the directors in its articles of incorporation or pursuant to a resolution of the shareholders' meeting. Different but reasonable emoluments from that of other directors may be set forth for the independent directors.
Where a securities firm separately sets aside a special reserve as stated in its articles of incorporation, as resolved at a shareholders' meeting or as ordered by the competent authority, the special reserve shall be set aside only after a legal reserve has been set aside and before remunerations of directors and supervisors and employee compensations are to be allocated. Its articles of incorporation shall also state how earnings shall be appropriated when the special reserve is reversed towards unappropriated earnings.
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Section 3 Functional Committees
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| Article 27 | For the purpose of developing monitoring functions and strengthening management mechanisms, the board of directors of a securities firm may, taking into account the basis of the size of the company, nature of business and the number of board directors, set up audit, compensation and remuneration, risk management, nomination, any other functional committees, and may set up environmental protection, corporate social responsibility or other committees based on the philosophy of corporate social responsibility and sustainable operation, and have them stipulated in the articles of incorporation.
Functional committees shall be responsible to the board and submit the proposals to the board of directors for approval. The above requirements, however, shall not apply when the audit committee is exercising the powers of supervisors in accordance with the Securities and Exchange Act, the Company Act and other laws.
Functional committees shall adopt organizational regulations to be resolved and approved by the board of directors. The organizational regulations should cover at least the number of members in the committee, terms of office, duties and authorities, meeting proceedings, and what resources to be provided by the company to support their exercise of duties.
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| Article 28 | It is advisable that a securities firm make it the first priority to set up the risk management committee, and shall either set up the audit committee or appoint supervisors.
The main functions and duties of the risk management committee are as follows:
- Stipulation of risk management policy and framework and designate responsibilities to the relevant corporate departments.
- Stipulation of risk assessment criteria.
- Setting the overall level of risk of the company and of each corporate department and managing the risk.
The risk management committee shall have at least one independent director with the expertise in securities and financial derivatives, accounting or finance in the committee who shall act as the convener.
The audit committee shall be made up of all independent directors and shall have at least three members. One of the members shall act as the convener, and at least one member shall have the expertise in securities and financial derivatives, accounting or finance.
Exercise of powers by the audit committee and independent directors who are members of the committee and other related matters shall be governed by the Securities and Exchange Act, the Regulations Governing the Exercise of Powers by Audit Committees of Public Companies, and the regulations of Taiwan Stock Exchange or Taipei Exchange.
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| Article 28-1 | A securities firm is advised to set up a remuneration committee or other committees with equivalent functions, with the major responsibilities of establishing the performance evaluation standards and emolument standards for managers and salespersons, and the structure and system of directors' emoluments. It is advisable for these committees to consist of a majority of members who are advised independent directors.
The performance evaluation standards and emolument standards for managers and salespersons, and the structure and system of directors' emoluments shall be created based on the following principles:
- A securities firm shall establish the standards for, or the structure or system of, performance evaluations and emoluments based on the performance after taking into consideration future risks, and with reference to the its overall long-term profits and shareholders' interest.
- The emolument and incentive system is not designed to encourage directors, managers and salespersons to attempt to perform an act that falls outside of its risk appetite suitable for a securities firm. The securities firm shall regularly review the emolument and incentive system and performance to ensure they are within its risk appetite.
- How long a securities firm pays emoluments shall be subject to its profits after future risks have been taken into consideration to prevent the securities firm from suffering losses after paying emoluments and other adverse circumstances. A significant part of emoluments paid as incentives shall be in a deferred manner or in the form of equities.
- When evaluating contribution of a director, manager and salesperson to the securities firm's profits on a personal level, a securities firm shall perform an overall analysis of the securities industry to figure out if their profits were generated because they have used the securities firm's overall advantages so that it will be able to have a meaningful evaluation of their individual contribution.
- A securities firm's agreement on severance pay with its director, manager and salesperson shall be made based on the performance that has been achieved to prevent the occurrence of a circumstance where an individual receives a large amount of severance pay after a short-term employment, and other inappropriate circumstances.
- A securities firm shall fully disclose to its shareholders the principles, methods and goals based on which it has established the standards for, or structure and system of, performance evaluations and emoluments as described above.
For purpose of the Principles, salespersons are individuals whose emoluments or performance evaluations are based on their sales of various financial products and/or services.
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| Article 28-2 | A securities firm is advised to establish a nomination committee and adopt organizational regulations. It is advisable for such committee to consist of a majority of its members who are independent directors and be chaired by an independent director.
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| Article 28-3 | A securities firm is advised to establish and announce whistleblowing methods for internal staff and external individuals, and create a whistleblower protection system. This system shall have related internal operation procedures and be included in the internal control system for control and management.
With regard to the above, at least the following shall be covered:
- Create and announce the mailbox and telephone number for internal whistleblowing, or appoint a third-party independent organization to provide the mailbox and telephone number for internal and external whistleblowing.
- Appoint staff or department responsible for accepting whistleblowing cases.
- Records of acceptance of whistleblowing cases, how the cases were processed, results, and production of related documents and archival of documents.
- Confidentiality of whistleblower's identity and details of the whistleblowing case.
- Measures for protection of rights and interests of whistleblower, who will not be subject to inappropriate treatment because of the whistleblowing.
Anonymous whistleblowing cases without identifying the real name and address of the whistleblower, or without providing specific information, may be rejected.
The regulations under subparagraph 5 of the second paragraph shall not apply to a whistleblowing case that, based on the findings of investigations, contains false claims and malicious accusations against securities firms or their staff.
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| Article 29 | A securities firm shall select a professional, responsible and independent CPA to be its external auditor, who shall perform regular reviews of the financial conditions and internal control measures of the company. With regard to the irregularity or deficiency timely discovered and disclosed by the auditor during the review, and the concrete measures of improvement or prevention suggested by the auditor, the company shall faithfully implement improvement actions. The securities firm is also advised to establish a communication channel or system for its independent directors, supervisors or audit committee and certified public accountants, and establish the internal operation procedures that shall be included in the internal control system for control and management.
A securities firm shall evaluate the independence and adequacy of the auditor engaged by the company regularly and no less frequently than once annually. In the event that the company engages the same auditor without replacement for seven years consecutively, or if the auditor is subject to disciplinary actions or other circumstances prejudicial to the independence of the auditor, the company shall evaluate the necessity of replacing the auditor, and shall submit to the board the conclusion of such evaluation.
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| Article 30 | A securities firm shall engage professional and competent legal counsel to provide adequate legal consultation services to the company, or to assist in the endeavor by the directors, the supervisors and the management to improve their knowledge of the law, for the purposes of preventing any infraction by the company or its staff of laws or regulations, and ensuring the corporate governance matters will proceed pursuant to the relevant legal framework and the prescribed procedures.
In the event that the directors, supervisors or the management are involved in litigation as result of performing his or her duties as provided by the law or arising from shareholders disputes, depending on the circumstances the company shall retain legal counsel to provide assistance.
The audit committee or its members who are independent directors may act on behalf of the company to appoint a lawyer, accountant or other professional to perform necessary reviews or provide consultations on matters relating to exercise of powers, with the costs to be borne by the company.
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Section 4 Rules for the proceedings of the board of directors' meetings and policy making procedures
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| Article 31 | A securities firm shall hold a board of directors' meeting no less frequently than once every quarter. The board meeting may be convened at any time in the event of an emergency. To convene a board meeting, it shall be expressly stated in the articles of incorporation that a notice be sent to each director and supervisor, stating the reason to hold the meeting, seven days before the meeting date. The meeting notice shall include sufficient information necessary to prepare the directors and supervisors for the meeting. In case of insufficient meeting information, directors shall have the right to request additional information or the board of directors may resolve to postpone reviews of a proposal.
A securities firm shall create the rules for the proceedings of the board of directors' meetings. Regulations for issues to be handled at the meeting, how a meeting is proceeded, particulars to be stated in the meeting minutes, public announcement and other matters for compliance shall be governed by the Regulations Governing Procedure for Board of Directors Meetings of Public Companies.
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| Article 32 | A director shall exercise a high degree of self-discipline and if a director himself or herself, or the juristic person the director is acting on its behalf, has an interest in a proposal submitted to the board of directors, he or she shall describe the important information about such interest, and if the risks may be detrimental to the interest of the company, the director shall not participate in discussion and voting of the proposal and shall voluntarily abstain from voting for himself or herself or as proxy for another director. The directors shall practice self-discipline as to their internal relationship and must not support each other in an inappropriate manner.
The matters with regard to which a director shall voluntarily abstain from voting shall be clearly set forth in the rules for the proceedings of board meetings. A securities firm shall set forth the matters which shareholders, directors, supervisors and other stakeholders apply for director abstaining on a particular proposal in the rules. The rules shall include qualification of applicants, procedure of applying and reviewing and deadline and formula of responding. The proposal that the director being applied for abstaining from voting shall abstain or not shall be submitted to the board for approval. Before resolution, the director shall not participate in or be proxy for voting on this proposal.
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| Article 33 | Independent directors of a securities firm shall attend a meeting in person, and not to have their proxy who are not independent directors to act on their behalf, to submit a proposal for matters to be submitted to the board of director under Article 14-3 of the Securities and Exchange Act. If an independent director expresses an adverse or qualified opinion, his or her opinion shall be stated in the minutes of the board meeting. If an independent director is unable to attend a board meeting in person to express an adverse or qualified opinion, he or she shall submit a written opinion prior to the meeting, unless with a legitimate reason, and his or her opinion shall be stated in the minutes of the board meeting.
When the board of directors resolves a matter relating to one of the following circumstances, the matter and resolution shall be stated in the meeting minutes and shall also be declared at the information reporting website designated by the competent authority within two days of the date of the board meeting:
- An independent director has expressed an adverse or qualified opinion, which has been stated in the meeting minutes or described in a written statement.
- Where a securities firm has set up an audit committee, a matter not passed at the audit committee but approved by more than two thirds of all directors.
During the proceeding of the board meetings, depending on the information in the proposal, managers from the relevant departments who are not directors may be notified to sit in at the meetings, make report on the current business conditions of the company and respond to inquiries raised by the directors. Where necessary, accountants, lawyers or other professionals may be invited to sit in at the meetings so as to assist the directors in understanding the conditions of the company for the purpose of adopting an appropriate resolution, provided they shall recuse themselves from the meeting during discussion and voting.
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| Article 34 | Staff personnel of a securities firm attending board meetings shall faithfully record meeting minutes in details and the summary, method of resolution, and voting results of all the proposals submitted to the board meeting in accordance with relevant regulations. In case a director has an interest in a proposal, the name of the director who has an interest in the proposal and the specific reason why he or she should abstain from discussion and voting, or not to abstain, shall be stated in the company's meeting minutes.
The board meeting minutes shall be signed or chopped by the chairman and secretary of the meeting, to be distributed to each director and supervisor within 20 days after the meeting. The director attendance records should be part of the meeting minutes. Board meeting minutes shall be treated as important corporate records and, during the life of the company, shall be placed in safekeeping permanently.
Meeting minutes may be produced, distributed and stored electronically.
The company shall audio- or video-record the whole proceedings of the board meetings and the recordings shall be kept for at least five years. The recordings may be stored electronically.
If, prior to expiry of the storage period in the preceding paragraph, there is a lawsuit pertaining to matters resolved at the board meeting, the audio or video recordings that are part of the evidence shall continue to be kept, in which case the preceding paragraph shall not apply.
Where a board of directors' meeting is held via videoconferencing, the audio and video recordings of the meeting shall be part of the meeting minutes and shall be stored permanently.
Where a resolution of the board of directors violates laws, regulations, articles of incorporation, or resolutions adopted in the shareholders' meeting, and thus causing injury to the company, dissenting directors whose dissent can be proven by minutes or written statements will not be liable for damages.
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| Article 35 | A securities firm shall submit the following matters to the board of directors for discussion.
- The company's operation plan.
- Annual financial report and semi-annual financial report.
- Establishment of or modification to the internal control system in accordance with Article 14-1 of the Securities and Exchange Act, and review of the effectiveness of said system.
- Establishment of and modification to the procedures of major financial and business activities such as acquisition or disposal of assets, performance of transactions of derivatives, lending of funds to third parties, granting of endorsements and provision of guarantees in accordance with Article 36-1 of the Securities and Exchange Act.
- Offering, issuance or private placement of securities of the nature of equity.
- Standards for performance evaluations and emoluments for managers and salespersons.
- Structure and system of directors' emoluments.
- Appointment and dismissal of chief financial, accounting risk management, compliance and internal audit officers.
- Donations to related parties or major donations to non-related parties, provided emergency pro bono donations in response to major natural disasters may be submitted to the board of directors' next meeting for retrospective approval.
- Matters to be submitted to the shareholders' meeting or board of directors for resolution in accordance with Article 14-3 of the Securities and Exchange Act, other laws and regulations or articles of incorporation, or important matters specified by the competent authority.
Except the matters required to be submitted to the board of directors for discussion as provided in the preceding paragraph, during the recess of the board of directors, the board of directors may authorize other persons to exercise the powers of the board in accordance with laws or the company's articles of incorporation. When such an authorization is made, information about level of authorization, what is covered in the authorization or particulars of the authorization shall be clear and specific. No general authorization shall be made.
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| Article 35-1 | Standards for performance evaluations and emoluments for a securities firm's managers and salespersons, and the structure and system of its directors' emoluments shall be established based on the following principles:
- A securities firm shall establish the standards for, or the structure or system of, performance evaluations and emoluments based on the performance after taking into consideration future risks, and with reference to the company's overall long-term profits and shareholders' interest.
- The emolument and incentive system is not designed to encourage directors, managers and salespersons to attempt to perform an act that falls outside of its risk appetite. The securities firm shall regularly review the emolument and incentive system and performance to ensure they are within the company's risk appetite.
- How long a securities firm pays emoluments shall be subject to its profits after future risks have been taken into consideration to prevent the securities firm from suffering losses after paying emoluments and other adverse circumstances. A significant part of emoluments paid as incentives shall be in a deferred manner or in the form of equities.
- When evaluating contribution of a director, manager and salesperson to the company's profits on a personal level, a securities firm shall perform an overall analysis of the securities industry to figure out if their profits were generated because they have used the company's overall advantages such as lower cost of funds so that it will be able to have a meaningful evaluation of their individual contribution.
- A securities firm's agreement on severance pay with its director, manager and salesperson shall be made based on the performance that has been achieved to prevent the occurrence of a circumstance where an individual receives a large amount of severance pay after a short-term employment, and other inappropriate circumstances.
- A securities firm shall fully disclose to its shareholders the principles, methods and goals based on which it has established the standards for, or structure and system of, performance evaluations and emoluments as described above.
For purpose of the Principles, salespersons are individuals whose emoluments or performance evaluations are based on their sales of various financial products and/or services.
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| Article 36 | A securities firm shall ask the appropriate corporate department or personnel to handle matters and implement actions pursuant to the board of directors' resolutions in a way consistent with the program schedule and objectives. It shall also follow up on these matters and faithfully review their implementation.
The board of directors shall ensure full control of the implementation and progress of these matters and make a report in subsequent meetings so as to ensure that the board's management decisions are faithfully implemented.
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Section 5 Fiduciary Duty, Duty of Care and Responsibility of Directors |
| Article 37 | Members of the board shall faithfully conduct corporate affairs and discharge this duty of care as a good administrator. In conducting the affairs of the company, they shall exercise their power with a heightened level of self-discipline and prudential attitude. Unless matters are reserved for resolutions in shareholders' meetings by law or in the articles of incorporation of the company, they shall ensure that all matters will faithfully adhere to the board's resolutions.
A securities firm is advised to create the rules and procedures for evaluation of performance of the board of directors, and conduct performance evaluations on the board of directors, functional committees and individual directors based on self-evaluation, peer-to-peer evaluation, evaluation by contracted external professional organization or other appropriate method regularly on an annual basis. It is advisable that the performance evaluations of the board of directors, including functional committees, include the following aspects, and that appropriate evaluation indicators be developed in consideration of the company's needs:
- The degree of participation in the company's operations.
- Improvement in the quality of decision making by the board of directors.
- The composition and structure of the board of directors.
- The election of the directors and their continuing professional education.
- Internal control.
It is advisable that performance evaluations of board members (self-evaluations or peer-to-peer evaluations) include the following aspects, with appropriate adjustments made on the basis of the company's needs:
- Their understanding of the company's goals and missions.
- Their recognition of director's duties.
- Their degree of participation in the company's operations.
- Their management of internal relationships and communication.
- Their professionalism and continuing professional education.
- Internal control.
The board of directors of a securities firm shall consider the results of the performance evaluations to adjust the composition of the board members.
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| Article 37-1 | The board of directors of a securities firm is advised to evaluate and monitor the following aspects of its direction of operation and performance in connection with intellectual properties, to ensure the firm develops an intellectual property regulatory system in accordance with the Plan-Do-Check-Act cycle:
- Formulate intellectual property regulatory policies, objectives and systems that are slightly associated with the operational strategies.
- Develop, implement and maintain on the basis of scale and form its regulatory systems governing the procurement, protection, maintenance and utilization of intellectual properties.
- Identify and provide the necessary resources sufficient to ensure effective implementation and maintenance of the intellectual property regulatory system.
- Observe internally and externally the risks and opportunities that intellectual property regulation may present and adopt corresponding measures.
- Plan for and implement a continuous improvement mechanism to ensure the operation and effects of the intellectual property regulatory regime meet the firm's expectations.
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| Article 38 | If a resolution of the board of directors violates law, regulations or the company's articles of incorporation, at the request of shareholders holding shares continuously for a year or an independent director, or at the notice of a supervisor to discontinue the implementation of the resolution, members of the board shall take appropriate measures or discontinue the implementation of such resolution as soon as possible.
Upon discovering any threat of the company suffering material injury, members of the board shall immediately report to the audit committee or independent directors who are members of the audit committee or supervisors in accordance with the foregoing paragraph.
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| Article 39 | A securities firm is advised to take out liability insurance for directors with respect to their liabilities resulting from exercising their duties during their terms of occupancy so as to reduce and spread the risk of material harm caused by directors due to wrongful or negligent acts to the company and shareholders.
After taking out or renewing liability insurance for directors, the securities firm is advised to report key information about the insurance such as insured amount, coverage and insurance premiums of the liability insurance to the next board of directors' meeting.
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| Article 40 | Members of the board are advised to participate in training courses of finance, risk management, business, commerce, accounting, law or corporation's social responsibilities which cover subjects relating to corporate governance upon becoming directors and throughout their term of office. They shall also ensure that company employees at all levels will enhance their professionalism and knowledge of the law.
The training of directors shall be fully disclosed, and such information along with their performance during the current term shall be provided to shareholders for their consideration to elect the next term of directors.
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