Ennoconn established the “Performance Evaluation of Boards and Directors” on December 26, 2012, and regularly conducts annual self-evaluation of the performance of the board members. The evaluation indexes include compliance with relevant laws and regulations, participation in the company’s operations, compliance with Directors’ interest recusal, and number of hours of annual training required of Directors.
On November 11, 2020, the Board of Directors approved an amendment to the “Board Evaluation”, which stipulates that the Board of Directors shall conduct a performance evaluation of the Board of Directors, its members, the Compensation Committee and the Audit Committee at least once a year. The internal evaluation shall be conducted at the end of each year in accordance with these rules. The performance evaluation of the Board of Directors shall be conducted by an external professional and independent organization or a team of external experts and scholars once every three years.
The performance evaluation of the Board of Directors, the Compensation Committee and the Audit Committee of the company includes the following areas:
(1) Participation in the operation of the company.
(2) Enhancement of the quality of the Board of Directors’ decisions.
(3) Composition and structure of the Board of Directors.
(4) Election and continuing education of Directors.
(5) Internal control.
The performance evaluation of the board members includes the following items:
(1) Understand company’s objectives and tasks.
(2) Directors’ awareness of their responsibilities.
(3) Involvement in the operation of the Company.
(4) Internal relationship management and communication.
(5) Directors’ professionalism and continuing education.
(6) Internal control.
The performance evaluation of the Functional Committee includes the following items.
(1) Understand company’s objectives and tasks.
(2) Awareness of Functional Committee responsibilities.
(3) Enhance the quality of Functional Committee decisions.
(4) Composition and selection of Functional Committee members.
(5) Internal control.
The evaluation is carried out by the Finance Department using an internal questionnaire. Based on the operation and participation of the Board of Directors, the Compensation Committee and the Audit Committee, the evaluation of the Board of Directors and the Functional Committees by the Directors and the evaluation of the Directors’ own participation are conducted. The results of the above performance evaluation will be used as a reference for the selection or nomination of Directors, and the results of the performance evaluation of Directors and Functional Committee members will be used as a reference for setting their individual compensation.
Ennoconn completed the performance evaluation of the Board of Directors, Board members, Compensation Committee and Audit Committee for FY2022 in the first quarter of FY2023, and presented the evaluation results and the direction to be continuously strengthened in the following year to the Board of Directors on March 8, 2023. The average performance evaluation score of the Board of Directors and Board members for FY2022 was over 90, and the average performance evaluation score of the Functional Committees was also over 90.
In January 2023, the company commissioned the Taiwan Corporate Governance Association to evaluate the performance of the board of directors and functional committees in 2022, and submitted the evaluation results to the board of directors on March 8, 2023.
| External assessment unit | Assessment year | Assessment scope | Evaluation certificate and report abbreviation | Report date |
|---|---|---|---|---|
| Taiwan Corporate Governance Association | 2022 | Board of Directors and Functional Committees | Download | Jan. 16,2023 |
| Inner Performance Evaluation | Assessment Unit | Evaluation Period | Evaluation Item | 2022 Score |
|---|---|---|---|---|
| Director performance evaluation | All current directors | Full year 2022 | (1) Participation in the operation of the company. (2) Enhancement of the quality of the Board of Directors’ decisions. (3) Composition and structure of the Board of Directors. (4) Election and continuing education of Directors. (5) Internal control. | 92.5 |
| Board performance evaluation | Discussion Unit | Full year 2022 | (1) Understand company’s objectives and tasks. (2) Directors’ awareness of their responsibilities. (3) Involvement in the operation of the Company. (4) Internal relationship management and communication. (5) Directors’ professionalism and continuing education. (6) Internal control. | 97.3 |
| Audit committee performance evaluation | All current members | Full year 2022 | (1) Understand company’s objectives and tasks. (2) Awareness of Audit committee responsibilities. (3) Enhance the quality of Audit committee decisions. (4) Composition and selection of Audit committee members. (5) Internal control. | 91.7 |
| Compensation committee performance evaluation | All current members | Full year 2022 | (1) Understand company’s objectives and tasks. (2) Awareness of Compensation committee responsibilities. (3) Enhance the quality of Compensation committee decisions. (4) Composition and selection of Compensation committee members. (5) Internal control. | 91.7 |
| Sustainable development committee performance evaluation | All current members | Full year 2022 | (1) Understand company’s objectives and tasks. (2) Awareness of Sustainable development committee responsibilities. (3) Enhance the quality of Sustainable development committee decisions. (4) Composition and selection of Sustainable development committee members. (5) Internal control. | 91.7 |
In accordance with Article 20 of the Ennoconn’s Articles of Incorporation, the remuneration of the company’s Directors shall be limited to 2% of the company’s profit for the year, and shall be reasonable in consideration of the company’s operating results and their contribution to the company’s performance. In addition to the overall operating performance of the company, the future operating risks and development trends of the industry, the performance achievement rate of individuals and their contribution to the performance of the company are also taken into consideration in determining the remuneration. The remuneration system is reviewed by the Compensation Committee and the Board of Directors from time to time in accordance with the actual operating conditions and relevant laws and regulations in order to strike a balance between sustainable operation and risk control.
Succession planning and operation of the Board of Directors and key management personnel:
(1) Board of Directors:
1. Succession Plan:
The Board of Directors should consider the diversity of its members, the size of the company’s business development and the shareholdings of its major shareholders, and the actual operational needs of the Directors, in addition to their knowledge and academic experience, and the proportion of Independent Directors to the number of Directors.
2. Operation:
Through the participation of senior managers in various forums, seminars, etc., we can identify and evaluate the suitability of possible suitable candidates from industry talents or contacts.
(2) Key Management:
1. Succession Planning.
Ennoconn’s succession plan begins with a careful evaluation of the current organizational situation, job and organizational characteristics, and possible future corporate strategic direction, in order to determine the talent needed to develop the future in line with the strategic direction of the organization, and to identify the senior management that fits the succession plan.
Ennoconn will provide a variety of training methods for senior management, including training courses to develop leadership, business warfare, cross-functional management and change management skills, etc. The company will also draw up career development plans for senior management and increase job development opportunities to enhance leadership skills through rotations and assignments.
Ennoconn will regularly review the performance of senior management to assess the suitability of the successor.
2. Operation:
Since 2019, Ennoconn has been reviewing the succession status of the company’s senior management every year, and based on the results of the review, we discuss with the Chairman of the Board to adjust the succession plan, while looking for outside talents to join the company as needed.