Governance and Operations
Walsin Lihwa upholds operational transparency and places high value on shareholder rights, firmly believing that a sound and effective Board of Directors forms the cornerstone of good corporate governance. To put this principle into practice, the Board has established four functional committees—the Audit Committee, the Remuneration Committee, the Sustainable Development Committee, and the Nomination Committee—to support the fulfillment of its oversight responsibilities. These committees formulate and review relevant policies and systems, ensure that related matters are advanced and implemented, and report their execution status and resolutions to the Board on a regular basis, thereby strengthening the Board's operations. In addition, to enhance the Board's effectiveness, Walsin Lihwa has designated a Chief Corporate Governance Officer, with Vice President Lo, Hueiping dedicated to advancing corporate governance affairs and ensuring that the Board operates in a compliant and transparent manner. Through legal compliance guidance and support for directors' duties, the Company ensures that its corporate governance mechanisms align with international standards.
In accordance with the Directions for the Implementation of Continuing Education for Directors and Supervisors of TWSE Listed and TPEx Listed Companies, all directors completed at least 6 hours of continuing education in 2025, for a total of 175.5 hours and a completion rate of 100%. To respond to key trends such as sustainable development and digital transformation, the directors' continuing education focused on two main themes: sustainability governance and digital development. In the area of sustainable development, directors actively participated in courses on sustainable finance, climate change, carbon credit markets, and energy transition—including the 2025 Cathay Sustainable Finance and Climate Change Summit, International Development Trends in Carbon Credit Trading, and Beneath the Wave—Energy Infrastructure Driving Sustainable Transformation. Sustainability-related courses totaled 48 hours in 2025, accounting for 27.4% of total continuing education hours. In the area of digital transformation, directors continued to enhance their knowledge and capabilities on topics such as smart manufacturing, artificial intelligence, and data governance, completing courses covering Digital Manufacturing Development Strategy, Practical Insights into the Latest Developments in Artificial Intelligence and Risk Management Frameworks, and Value Creation through Digital Transformation—Leading Change through Data and Unlocking Opportunities for AI Industrialization. Digital development-related courses totaled 59 hours in 2025, accounting for 33.6% of total continuing education hours.
Company website - "Governance" page
For details on corporate governance, please refer to Chapter 3, "Governance" of the Company's 2025 Sustainability Report.
▪Governance Framework and Operations
Note: The reporting period for operational status is January 1, 2025 to December 31, 2025.
Board of Directors
The Board of Directors is Walsin Lihwa's highest governance body and decision-making center, responsible for overseeing the Company's overall business management. The Company convened its Annual General Meeting of Shareholders on May 19, 2023, at which the 20th-term directors (including independent directors) were elected for a three-year term effective from the date of election. In accordance with Article 14 of the
Articles of Incorporation, the Board comprises 9 to 11 directors, including at least 3 independent directors. Walsin Lihwa's Board is composed of industry leaders and financial and accounting experts; the current term consists of 11 directors. To strengthen Board independence, the number of independent director seats exceeds the statutory minimum, accounting for 36% of all directors. As of December 2025, all of the Company's independent directors comply with the relevant regulations governing independent directors issued by the Securities and Futures Bureau of the Financial Supervisory Commission, and none of the circumstances specified in Paragraphs 3 and 4 of Article 26-3 of the Securities and Exchange Act exist among the directors or between directors and independent directors, thereby ensuring the independence of the Board. The Board convenes at least once each quarter; to effectively implement independent oversight and checks-and-balances mechanisms, all proposals are deliberated by the Board, and material resolutions are disclosed on the Company's website in real time to ensure information transparency.
Conflict-of-Interest Recusal Mechanism of Directors
Walsin Lihwa has established the
Ethical Conduct Guidelines for Directors of the Board and Managerial Officers, strictly adhering to the principles of conflict-of-interest avoidance and anti-corruption, and follows the procedures set forth in the
Board of Directors Meeting Regulations. When a proposal involves a matter for which a director—or the juristic person the director represents—must recuse themselves under the aforementioned regulations, or when a director's own interests may harm the Company's interests, the director must recuse themselves and may not participate in the discussion or voting, nor exercise voting rights on behalf of other directors. The names of the directors concerned, a description of the key matters, and the recusal circumstances are all recorded in the meeting minutes to safeguard the best interests of the Company and its stakeholders.
Nomination and Election of Directors
Walsin Lihwa's Board has established the
Nomination Committee Charter and the
Methods of Election of Directors of the Board Walsin Lihwa, which clearly govern the nomination, qualification requirements, evaluation criteria, and election procedures for director candidates. The Nomination Committee is responsible for submitting the list of candidates to the Board; after the Board carefully evaluates their qualifications, the election is conducted in accordance with relevant laws and regulations and directors are elected by vote at the shareholders' meeting. When nominating independent directors, particular attention is paid to the candidates' experience, expertise, integrity, and the legal compliance of their concurrent positions, ensuring conformity with the Securities and Exchange Act, the Regulations Governing the Appointment of Independent Directors and Compliance Matters for Public Companies, and the requirements of the competent authority. Walsin Lihwa adopts a candidate nomination system and cumulative voting, under which shareholders elect directors from the slate of candidates; the acceptance of nominations and the announcement procedures are handled in accordance with the relevant provisions of the Company Act and the Securities and Exchange Act. In addition, shareholders holding 1% or more of the Company's total issued shares may submit a list of director candidates in writing, ensuring shareholder participation in the nomination process. Independent and non-independent directors are elected jointly, with the number of seats calculated separately. Walsin Lihwa's Board sets a target of women directors comprising one-third of its composition, in order to promote Board diversity and governance quality.
Board Diversity
Walsin Lihwa has established the Principles for the Selection of Board Members and Managerial Officers and the Guidelines for Their Continuing Education and Succession Plans to achieve diversity in the professional knowledge, experience, and gender of Board members, as well as independence. Going forward, in response to the Company's development strategy and changes in the internal and external environment, the Company will continue to invite suitable candidates to join the Board in line with these objectives, thereby strengthening the Board's balance. The 20th-term Board in 2025 comprises 11 directors: Chairman Mr. Chiao, Yu-Lon; Vice Chairman Mr. Wang, Shyi-Chin; Mr. Chiao, Yu-Cheng; Mr. Chiao, Yu-Heng; Mr. Chiao, Yu-Chi; Mr. Hsia, Andrew; Ms. Hsieh, Wen-Chien; and four independent directors: Mr. Hsueh, Ming-Ling; Mr. Hu, Fu-Hsiung; Mr. Duh, Tyzz-Jiun; and Mr. Gau, Wey-Chuan. The Board is composed of members of the management team, managers from related industries, and professionals with backgrounds in finance, business, and accounting. Drawing on their diverse fields and work experience, Board members effectively fulfill their functions, which include establishing and maintaining the Company's vision and values, helping to advance corporate governance and strengthen business management, and supervising and evaluating the implementation of management's policies and business plans. The Board is responsible for the Company's overall operating conditions across the economic, environmental, and social dimensions and, from the perspective of stakeholders, works to enhance the standard of corporate governance and corporate value. For information on directors' education and professional backgrounds, terms of office, concurrent positions at the Company and other companies, professional qualifications, independence, the implementation of diversity, and sustainability-related training and continuing education, please refer to the Company's annual report and official website.
Performance Evaluation and Compensation
In accordance with the
Regulations Governing Board Performance Evaluation, Walsin Lihwa's Board engaged the Taiwan Corporate Governance Association—an independent body with no business dealings with the Company—to conduct Board effectiveness evaluations in 2018, 2021, and 2024. Through the review by this professional institution and the guidance and exchange provided by its assessors, the Company obtained objective evaluation results and recommendations, which serve as a reference for continuously optimizing the Board's functions and the quality of its proceedings. The performance evaluations of the Board and each functional committee for 2025 have been completed and were reported to the Board on January 23, 2026; detailed results are available on the Company's official website. In accordance with the Regulations Governing the Payment of Remuneration to Directors and Functional Committee Members, the Remuneration Committee—based on the results of directors' performance evaluations and taking into account the Company's business strategy, profitability, future development, industry environment, and risk factors, and weighing each director's level of participation in and contribution to the Company's operations—proposes remuneration recommendations for execution upon Board approval.
In addition, the Company will evaluate incorporating a director shareholding policy into its considerations in the future. The remuneration policy for the President, Vice Presidents, and managerial officers of equivalent rank is formulated in accordance with the Regulations Governing Performance Evaluation and Remuneration Management for Managerial Officers, with reference to the Company's business strategy, profitability, individual performance, and market pay levels; recommendations are proposed by the Remuneration Committee and executed upon Board approval. The remuneration structure for managerial officers includes equity incentive arrangements such as treasury shares, restricted stock, employee stock ownership trusts, and employee stock options as long-term incentives. The Company has previously used treasury shares to incentivize senior executives and has provided employees with preemptive subscription rights through cash capital increases in order to raise senior executives' shareholding ratios and strengthen alignment with shareholders' interests. Furthermore, to fulfill its corporate sustainability responsibilities, the Company added a Corporate Sustainability Development Indicator starting in 2024 and incorporated it into the performance evaluation of senior managerial officers, accounting for 10% of the overall performance evaluation weighting. This indicator covers strategic objectives across the environmental, social, and governance (ESG) dimensions—including environmental management, occupational safety, and legal compliance—and incorporates the advancement of climate change-related risk management and carbon reduction actions, thereby linking sustainable development goals with the remuneration policy for managerial officers.
Sustainability Governance
Walsin Lihwa is committed to protecting stakeholder rights and interests.
While pursuing sustainable business growth and profitability, the Company
prioritizes ESG impacts and continuously improves its sustainability
performance. Following the Board's approval of the establishment and
organizational charter of the Sustainable Development Committee,
the Committee is primarily responsible for assisting the Board in the
governance and oversight of the Company's sustainability-related matters―
spanning topics such as integrity management and corporate governance,
environmental sustainability and green operations, talent management
and employee care, supply chain and value chain management, and
human rights protection and social inclusion―thereby implementing the
philosophy of corporate sustainable development and actively advancing
and strengthening the Company's sustainable business strategy.
Organizational Structure of the Sustainable Development Committee
Walsin Lihwa adopts a three-tier sustainability management structure. The first tier, the Sustainable Development Committee, serves as the oversight and decision-making body; the current Committee is composed of six members with professional sustainability expertise and is convened by an independent director. The second tier is the Sustainability Office, coordinated by the Chief Sustainability Officer, which supports the planning and execution of sustainability strategies and reports regularly to the Board. The third tier consists of five subordinate promotion centers—the Business Integrity Center, the Environmental Safety and Health Promotion Center, the Green Operation Center, the Customer Service and Supplier Management Center, and the Employee Relations and Social Engagement Center—which, in line with the direction of the Committee's resolutions, are responsible for advancing and implementing the various sustainable development strategies and action plans.
▪Operations of the Sustainable Development Committee
IFRS Sustainability Disclosure Standards: Implementation Plan and Progress
In response to the global trend toward the financial integration of sustainability information, and in alignment with the FSC's Blueprint for the Adoption of IFRS Sustainability Disclosure Standards in Taiwan, Walsin Lihwa - as one of the listed companies required to apply the standards from 2026 - initiated pre-adoption activities in 2024. Using the consolidated financial statements as the reporting boundary, and following ISSB standards IFRS S1 (General Requirements for Disclosure of Sustainability-related Financial Information) and IFRS S2 (Climate-related Disclosures), the Company established a cross-functional project team to identify material sustainability-related risks and opportunities, inventory data sources, assess disclosure gaps, and plan corresponding response activities.
During project execution, the adoption progress and outcomes are tracked quarterly according to the annual plan; the related implementation status is discussed and approved by the Sustainable Development Committee before being reported to the Board, ensuring that all work proceeds smoothly.
