Board and Executive Succession Planning

Board of Directors Succession Plan and Implementation

1. Succession Planning for Board Members

(1) In accordance with the Company’s Articles of Incorporation, the election of directors fully adopts the candidate nomination system. Furthermore, the Corporate Governance Practice Principles and the Rules for Election of Directors stipulate that the composition of the Board shall take diversity into account. Based on the Company’s operational model and development needs, a diversity policy has been established, including but not limited to the following two dimensions:

• Basic qualifications and values;
• Professional knowledge and skills.

(2) The Company has formulated an ongoing succession plan for directors and established a candidate database according to the following criteria:

• Possess integrity, accountability, innovation, and decision-making ability, aligned with the Company’s core values, and equipped with professional knowledge and skills conducive to business operations.
• Possess industry experience relevant to the Company’s business.
• Be expected to contribute to an effective, collaborative, diverse, and company-aligned Board of Directors.

The Company also sets a target that female directors shall account for at least one-third of all Board seats. In addition, the collective expertise of the Board shall cover corporate strategy, accounting and taxation, finance, law, administrative management, and production management. The nomination and selection process for director candidates must undergo qualification review and comply with relevant regulations, ensuring that suitable candidates can be effectively identified and appointed when vacancies arise or when the Board is expanded.

(3) The Company has established the Regulations for Performance Evaluation of the Board of Directors and Functional Committees. Evaluation indicators include:

• Leading corporate goals and objectives;
• Awareness of responsibilities;
• Participation in operations;
• Management of internal relationships and communication;
• Professional competence and further OTJ training;
• Internal management;
• Expression of concrete and constructive opinions.

The results are used to ensure the effectiveness of the Board’s operation and to serve as a reference for future director selection.

2. Succession Planning for Key Management

(1) The Human Resources Department is responsible for developing a succession development plan for key positions, with at least one designated successor for each position. Based on successors’ strengths abilities for development, training resources are allocated to management programs, new technology, and job rotations. Since 2021, the Company has implemented Individual Development Programs (IDPs) on short-, medium-, and long-term plan (1–3 years) for succession candidates. Through competency assessments, combined with corporate and departmental objectives, the Company strengthens incumbents’ capabilities and enhances readiness for succession.

(2) The Company holds an annual strategic consensus camp for senior executives (including the CEO/General Manager). Courses and discussions are held on topics such as:

• Systematically thinking;
• Performance and personnel management;
• High-performance leadership;
• Organizational change and continuous renewal;
• Change management;
• Strategic thinking and planning;
• Leading Business growth ;
• Personnel development and leader succession;
• Strategy mapping;
• Leadership development systems.

(3) Each year, the Company also conducts management training programs for mid- to senior-level managers. These programs integrate external knowledge of industry trends, technological advancements, and best practices from benchmark enterprises, enabling participants to stay abreast of the latest management concepts. At the same time, senior executives share their leadership experience to pass on the Company’s organizational culture and practical management know-how.