CTBC Financial Holding Sustainable Governance Programme
中國信託金控公司治理精進方案


CTBC Financial Holding Co., Ltd.

INTRODUCTION

Corporate governance is the foundation of corporate sustainability. CTBC is keenly aware that businesses in the finance industry must adhere to higher standards of corporate governance to satisfy stakeholders’ expectation. In order to uphold the trust of stakeholders and improve governance practice, CTBC initiated a series of corporate governance reforms including separating management rights from ownership rights; improving the matrix of expertise, skills, and experiences of the board; having independent directors represent more than half of the board; ruling independent director’s term of office not exceeding three sessions; and appointing the corporate governance officer, etc. To look backwards, every appropriate measure CTBC took in corporate governance maximised the Company’s values. Forward to the future, CTBC will continually make much difference one after another all for the purpose of demonstrating its governance responsibility.

FRAMEWORK AND STRATEGY

  • A well-established Corporate Governance Framework: CTBC has separated management from ownership. Directors can no longer serve on the board while concurrently holding a managerial position. The board is held responsible for supervising the management team. The management team is implemented and executed the business proposals and objectives. When comes to implementing corporate governance best practice, CTBC places great importance on team building. After the board of directors formulates a policy, each department institutes a hierarchical system of responsibility specifically tailored for the task at hand. A corporate governance officer under the Chairman’s office will also support directors to execute the duties and coordinate the functional committee and board meetings.
  • A Sound Corporate Governance: CTBC is the first financial holding company in Taiwan to have more than one-half of the board comprising independent directors. It is also the first financial holding company in Taiwan ruled the independent director’s term of office not exceeding three sessions.There are five functional committees currently operating under the Board of Directors. To further strengthen Director’s power and knowledge, all CTBC directors are required to meet an annual continuing education requirement of six hours. At the end of the year, the director will conduct a self-performance assessment of the Board and itself. A periodic communication among independent directors, internal auditors and CPAs is every six months. Furthermore, CTBC adopted a webbased system comprehensively integrating the overall administrative meetings process into an online submissions system to enhance the administrative process for board meetings.
  • Transparency and Information Disclosure: CTBC is committed to maintaining an open and transparent disclosure on company information. The Company provides easy access to information on its Chinese and English website. Information released online includes financial reports, annual reports, and documents relating to corporate governance and corporate social responsibility. For institutional investors, a total of four investor conferences were held in 2018.
  • Stakeholder Engagement and Whistleblower System: CTBC values the rights and interests of every stakeholder and has set up a stakeholder page on the company website to understand the expectations and needs from stakeholders in order to provide responses to the ESG issues of their concern. In addition, CTBC has also established a whistleblower reporting system to ensure effective ethical corporate Management.

ACHIEVEMENT AND IMPACT

CTBC’s performance in corporate governance has won public recognition. The Company was included in the Dow Jones Sustainability Indexes for the third consecutive year, were selected for the fifth straight time for the Morgan Stanley Capital International (MSCI) ESG Leaders Indexes, and listed in the FTSE4Good Emerging Index for the fifth consecutive year.

FUTURE DIRECTION

In response to the growing emphasis on corporate governance issues, CTBC has set up a strong corporate governance mechanism. As a company of excellent quality, CTBC will continue to strengthen its corporate governance, fulfill corporate social responsibility, and create values for customers, employees, shareholders, and society as a whole.

The Company will also use “TRUST” as a testament to demonstrate the importance of corporations, environment, employees, customers, and society to the Company through five major dimensions of governance and responsibility (Transparency), environmental sustainability(Responsibility), employee care (Understanding), products and services(Satisfactory), and social development(Together) to ensure a sustainable and sound governance constitution.
CTBC Financial Holding Co., Ltd. was established on May 17, 2002 and is headquartered in Taipei, Taiwan. CTBC Holding’s subsidiaries include banking, insurance, securities, securities investment trust, venture capital, asset management, security and lottery. Looking ahead, CTBC will continue to uphold its brand spirit of “We are family” and corporate mission of “Protect and Build” as the Company strives to create values for customers, shareholders, and the society. CTBC aims to become “Taiwan Champion, Asia Leader”- a leading brand with the best corporate governance, and the most trusted financial institution by customers and shareholders.