Corporate Sustainability

GOVERNANCE

Structure and operation of the Board of Directors

The Board of Directors is the highest governance body of CWE. In conducting the Company's affairs, it shall exercise its powers with a high level of self-discipline and prudence, and assist in supervising, appointing, and instructing the management, as well as overseeing the Company's operations. In addition to matters that must be resolved by the shareholders' meeting in accordance with the law or the Articles of Incorporation, the Board of Directors conducts the Company's business based on its resolutions and is also responsible for formulating the Company's corporate social responsibility and sustainable development strategies. The CWE Board of Directors comprises seven members with extensive industry experience, including four directors and three independent directors, one of whom is a female director. The Board members are selected in accordance with a fair, impartial, and transparent director appointment process. The election of directors follows a candidate nomination system, where candidates are approved by the Board of Directors and then submitted to the shareholders' meeting for final appointment.

To establish proper governance system of the Board of Directors, improve supervision and strengthen management efficiency, we formulate the Rules of Procedure for Board of Directors's Meetings based on Article 2 of the Regulations Governing Procedure for Board of Directors Meetings of Public Companies. The CWE Board of Directors convenes at least once every quarter. For the operation of the Board of Directors, please refer to CWE's 2023 Annual Report.

The current term of the Board of Directors is from June 17, 2022 to June 16,2025, spanning three year. In 2023, a total of eight Board meetings were held. The relevant information about the Board members is as follows：

Information of the Board members

Title	Name	Gender / Age	Experience (Education)	Attendance in Person	Attendance Rate (%)
Chairman	Juan Yao Investment Co., Ltd. Rep.: Hung, Chuen-Sing	Male 59	Graduated from Hong Kong Polytechnic University. He is now the Corporate Director and President of subsidiary CWTC as well as the Corporate Director of JMC Electronics Co., Ltd., the Corporate Director of eChem Solutions Corp. Corporate and a Director in several subsidiaries of the CWE Group. He is a Director in companies within the electronic technology industry chain with expertise in governance. Once served as president of Possehl Electronics Hong Kong Ltd. and Sumiko Electronics Taiwan Co., Ltd., He has been involved in the operation and strategic management of semiconductor industry for more than 30 years.	8	100%
Director	Yuan Yao Energy Technology Co., Ltd. Rep.: Canon, Huang	Male 65	Graduated from the Department of Mechanical Engineering in Chung Yuan Christian University. He is now the President of CWE as well as the Chairman and CEO of Chang Wah Technology Co., Ltd.、the vice Chairman of JMC Electronics Co., Ltd., the Director of Elite Semiconductor Microelectronics Technology Inc. and a Director in several subsidiaries of the CWE Group. He is a Director in companies within the electronic technology industry chain with expertise in governance. Once served in managerial position at several multinational corporations such as ASE Electronics Inc., Orient Semiconductor Electronics Ltd., and Wah Lee Industrial Corp., he has been involved in the operation and strategic management of semiconductor industry for more than 30 years.	7	88%
Director	Wah Lee Industrial Corp. Rep.: Chang, Tsuen-Hsien	Male 59	Graduated from the Departments of Electrical Engineering and Biomedical Engineering in University of Southern California, USA. He is now the President of the Company as well as the Chairman, the Corporate Director of Wah Hong Industrial Corp. and director in several subsidiaries of the Wah Lee Group. He is a Director in companies within the electronic technology industry chain with expertise in governance. Once served as the special assistant to Chairman and CEO of Wah Lee Industrial Corp.	8	100%
Director	Huang, Shiou-Chuan	Male 73	Graduated from the Department of Electrical Engineering in Tatung University. He is now the Chairman of Vizionfocus Inc. Once served as Vice President or Vice Chairman at several multinational corporations such as HP Taiwan Information Technology Ltd., Hon Hai Group, and Innolux Corporation.	8	100%
Independent Director	Kong, Chi-Chuan	Male 64	Graduated from the Department of Senior Petrochemical Division, Ko Ying Senior Vocational School of Commerce and Industry. He is now the Chairman of Jiao Chang Customs Brokerage Limited as well as a Director in Tsing Ho Real Estate Co., Ltd. Once served as manager of Jiao Chang Customs Brokerage Limited.	8	100%
Independent Director	Chen, Chih -Cheng	Male 49	Graduated from the Bachelor of Accounting, Feng Chia University. He is now a CPA of Zhuo Cheng Accounting Firm as well as a Independent Director, Audit Committee and Remuneration Committee Member of Yuen Chang Stainless Steel Co., Ltd., the Independent Director, Audit Committee and Remuneration Committee Member of Jason Co.,Ltd. Once served as Senior Assistant President of Deloitte & Touche.	8	100%
Independent Director	Yen, Shu-Yang	Female 47	Graduated from MBA/LLM, American University, Bachelor and Master of Laws, Fu Jen Catholic University. She is now the Managing Attorney of Asian Pacific Int'l Patent & Trademark Office as well as a Corporate Director epresentative in EFUN Technology Co., Ltd. and the Independent Director, Audit Committee and Remuneration Committee Member of Franbo Lines Corp. Once served as Chien Yeh Law Offices Junior Partner of Kaohsiung Office and Guo Yu Shan Law Firm Attorney.	8	100%

Board Diversity

To ensure that the Board of Directors has strong governance capabilities, it is required that the Board of Directors members possess professional competencies in areas such as operational judgment, financial analysis, business management, risk management, industry knowledge, international market perspective, leadership, and decision-making.

The nomination and selection of the Board members comply with the Articles of Incorporation and adopt a candidate nomination system. The Secretariat of BOD reviews the qualifications of candidates before submitting them to the Board of Directors for final resolution, ensuring the diversity and independence of the Board members.

Implementation of Board Diversity

Policy	Goals	Performance in 2023	Accomplishment
Professional Competence	Diversity of professional background, skills and industry experience.	The Board members include professionals from industry, accounting, technology and management fields. The directors possess the knowledge, skills and competencies required to carry out their duties, and their industry experience and professional expertise are diverse and complementary.	V
Gender Equality	At least one female Director.	There is one female director among the seven directors.	V
Independence	The number of directors who are also managers of the Company should be less than one-third of the Board seats. The number of independent directors should be at least one-third of the Board seats. Independent directors should not serve consecutively for more than three terms.	Only a director also serve as managers of the Company, accounting for 14%. Three of the seven directors are independent, accounting for 43%. None of the independent directors have served for more than three consecutive terms.	V

Diverse Backgrounds of the Board Members

Diversified Core Competence \ Name	Nationality	Gender	CWE Employee	Seniority of Independent Director	Age			Professional Knowledge and Skills
Diversified Core Competence \ Name	Nationality	Gender	CWE Employee	Seniority of Independent Director	< 60 Years old	61~70 Years old	>71 Years old	Corporate Governance	Marketing	Industry Knowledge	Leadership	Policymaking ability	Operation Management	Legal Affairs	Accounting and financial analysis skills
Juan Yao Investment Co., Ltd. Rep.: Hung, Chuen-Sing	HK	Male			V			V	V	V	V	V	V
Yuan Yao Energy Technology Co., Ltd. Rep.: Canon, Huang	ROC	Male	V			V		V	V	V	V	V	V
Wah Lee Industrial Corp. Rep.: Chang, Tsuen-Hsien	ROC	Male			V			V	V	V	V	V	V
Huang, Shiou-Chuan	ROC	Male					V	V	V	V	V	V	V
Kong, Chi-Chuan	ROC	Male		5		V		V	V	V	V	V	V
Chen, Chih -Cheng	ROC	Male		2	V			V		V	V	V	V		V
Yen, Shu-Yang	ROC	Female		2	V			V		V	V	V	V	V

Continuing Education of Directors

To enhance the functions of the members of the CWE Board of Directors, the Board members actively participate in relevant training courses which organized by institutions designated by the Taiwan authorities, in accordance with Directions for the Implementation of Continuing Education for Directors and Supervisors of TWSE Listed and TPEx Listed Companies and the regulations of the Taiwan authorities. The Board members remain attentive to developments in domestic and international economic, environmental, and social regulations by taking courses in various areas including finance, risk management, operations, business, accounting, law, corporate governance, integrity and ethics, and corporate social responsibility. This approach aims to strengthen the Board's leadership and decision-making capabilities and ensure the diligent execution of business and management responsibilities.

In 2023, the total training hours of the CWE Board members met the legal requirement of six hours, with an average of 9 training hours per director and a total of 63 training hours.

Continuing Education of Directors Recently

Year	Number of Directors	Training Hours	Average Hours
2021	9	63	7.00
2022	7	54	7.71
2023	7	63	9.00

Year

Number of

Directors

Training

Hours

Average

Hours

2021

7.00

2022

7.71

2023

9.00

Performance Evaluation of the Board of Directors

To strengthen the operational functions and efficiency of the Board of Directors, CWE has established the Rules for Performance Evaluation of the Board of Directors to assess the performance of the Board at least once every year. To ensure the Board of Directors is capable of fulfilling its responsibilities in corporate governance, management operations and achieving sustainable development, the evaluation includes the level of company engagement, the enhancement of decision-making quality, composition and structure of the Board, the election and continuing education of the directors, and internal control.
In 2023, the overall average self-evaluation score of the CWE Board of Directors was 99.31 out of 100. The overall average self-evaluation score for individual board members was also 94.94 out of 100, with an overall performance rating of " Excellent."

Results of the Board Performance Evaluation for Years

Year	Internal Evaluation
2021	97.97/100 A sound operation of the Board.
2022	98.87/100 A sound operation of the Board.
2023	99.31/100 A sound operation of the Board.

Functional Committees

To effectively enhance the functions of the Board of Directors, develop supervisory functions and strengthen management mechanisms, CWE has established the “Compensation Committee” and “Audit Committee” under the Board, based on their authorities and functions. These committees are designed to ensure the effective implementation of independent supervision and checks and balances mechanisms, and to ensure that all resolutions and actions of the Board are duly reported and discussed. If a proposal involves any conflict of interest with a director or the legal entity they represent, the director must recuse themselves to uphold the best interests of stakeholders.

Additionally, an administrative audit unit, the "Audit Office," has been set up. Its responsibility is to audit and evaluate the reliability and effectiveness of the Company's internal control system. The Audit Office regularly reports audit results and provides improvement recommendations to the Audit Committee to promote the Company's effective operations.

Audit Committee

The Audit Committee is composed of three independent directors, one of whom must possess expertise in accounting and finance. The committee assists in overseeing the fair presentation of the Company's financial statements; the appointment (or dismissal), independence, and performance evaluation of the Company's CPAs; the effective implementation of internal controls; compliance with relevant laws and regulations; and the management of existing or potential risks. The resolutions passed in the meetings are documented in minutes and submitted to the Board of Directors. In 2023, the committee held seven meetings, with an overall attendance rate of 100% by its members.

To strengthen the operational functions and efficiency of the Audit Committee, CWE assess the performance of the Audit Committee at least once every year, including the level of participation in the company's operations, recognition of functional committee responsibilities, improvement of the quality of functional committee decisions, functional committee composition and selection of members, and internal control. The evaluation covered 22 indicators in five aspects. The overall score was 100/100, indicating an excellent operation and receiving positive reviews.

Attendance of the Audit Committee in 2023

Title	Name	Attendance in Person	Attendance Rate (%)
Independent Director	Chen, Chih -Cheng (Convener)	7	100%
Independent Director	Kong, Chi-Chuan	7	100%
Independent Director	Yen, Shu-Yang	7	100%

Compensation Committee

The Compensation Committee is composed of three independent directors. The committee assists the Board of Directors in implementing and evaluating the Company's overall compensation and benefits policies, as well as the remuneration of directors and executives, with a professional and objective perspective. The committee regularly provides recommendations to the Board as a reference for decision-making. In 2023, the committee held four meetings, with an overall attendance rate of 100% by its members.

To strengthen the operational functions and efficiency of the Compensation Committee, CWE assess the performance of the Compensation Committee at least once every year,including the level of participation in the company's operations, recognition of functional committee responsibilities, improvement of the quality of functional committee decisions, functional committee composition and selection of members. The evaluation covered 19 indicators in four aspects. The overall score was 100/100, indicating an excellent operation and receiving positive reviews.

Attendance of the Compensation Committee in 2023

Title	Name	Attendance in Person	Attendance Rate (%)
Independent Director	Kong, Chi-Chuan (Convener)	4	100%
Independent Director	Chen, Chih -Cheng	4	100%
Independent Director	Yen, Shu-Yang	4	100%