Board of Directors | Corporate Governance

Board Membership
Ability of the board of directors
Diversification of Board
Diversification Item
Major Resolutions of Board Meetings
Board Performance Evaluation
Succession planning for board members and the managerial officers

Board Membership

Chairman – Chi-Chia Hsieh

Education：Ph.D. in Electrical Engineering, Santa Clara University

Major Past Positions：

1. Chairman, Microelectronics Technology Inc.
2. Director, Microwave Circuit Department, Harris Corporation.

Director – Eugene Wu

Education：Master Degree in Electrical Engineering, University of Pittsburgh, USA

Master Degree in Business Administration, Rensselaer Polytechnic Institute

Major Past Positions：President and CEO, Microelectronics Technology Inc.

Spokesperson, Microelectronics Technology Inc.

Independent Director – Golub Drakulovic

Education：M.B.A. - Fairleigh Dickenson University, Rutherford, NJ

Major Past Positions：

1. VP China Wireless R&D - Lucent/Alcatel
2. Director of Lucent Wireless Technical Center in China
3. Director of Lucent CDMA Deployment Wireless Networks (US)

Independent Director – Yun Lin

Education：Ph.D. in Economics, University of Illinois at Urbana-Champaign

Major Past Positions：

1. Director of Finance Department, National Taiwan University
2. Professor at Department of Business Administration, Shih Hsin University

Independent Director – Jong Wang

Education：NCTU Executive Master of Business Administration

Major Past Positions：

1. Partner, LEE and LI Attorneys-At-Law

2. Vice President and Chief Legal Officer, Polytronics Technology Corp.

Ability of the board of directors

According to the Article of Incorporation, MTI adopts the candidate nomination system for elections of directors. The shareholders shall elect the directors from among the nominees listed in the roster of director candidates.
In accordance with the Article 20 of MTI Corporate Governance Best Practice Principles, the board members should generally possess the necessary knowledge, skills and literacy to perform their duties.
In order to achieve the ideal goal of corporate governance, the overall ability of the board of directors should be as follows:
1. Good judgement in operations.
2. Accounting and financial analysis capabilities.
3. Business management capabilities. (Including Subsidiary management)
4. Crisis handling abilities.
5. Industrial knowledge.
6. Vision to international market.
7. Leadership.
8. Decision-making ability.
9. Risk management knowledge and abilities.

Diversification of Board

The company focuses on professional knowledge, skills and gender equality in the composition of the Board of Directors. All the 7 members of the Board are good at corporate management and operation, with international market view and capacity in leadership and decision-making. The Company had achieved the first target of having more than half of directors experienced in relevant industries, including Dr. Chi Hsieh, Mr. Gwong-Yih Lee, Mr. Hank Hsieh, Mr. Eugene Wu and Mr. Golub Drakulovic. The second target is to have more than two-sevenths female directors in the Board. Now Dr. Yun Lin who is good at accounting and financial analysis are the only female director in the Board. Mr. Jong Wang is a professional practicing lawyer with a legal background. In addition, there are 3 Independent Directors in the Board (43% of the total) according to the Article of Incorporation.

Diversification Item

Name	Nation -ality	Gen -der	Con -current Employee	Years of indepen -dent director	Oper -ation Manage -ment	Leader -ship & Decision-making	Finance & Accoun -ting	Intern -ational Market perspe -ctive	Risk Planning	Trend analysis of the indu -stry
Chi Hsieh	R.O.C	Male	V	-	V	V	-	V	V	V
Gwong-Yih Lee	R.O.C	Male	-	-	V	V	-	V	V	V
Maxon Huang	R.O.C	Male	-	-	V	V	-	V	V	V
Eugene Wu	R.O.C	Male	-	-	V	V	-	V	V	V
Golub Drakulovic	U.S.A	Male	-	within 3 years	V	V	-	V	V	V
Yun Lin	R.O.C	Female	-	3-6 years	V	V	V	V	V	V
Jong Wang	R.O.C	Male	-	within 3 years	V	V	-	V	V	V

Major Resolutions of Board Meetings

According to MTI Regulations Governing Procedure for Board of Directors Meetings, a board of directors shall meet at least quarterly. The Board convened for 8 times in 2022. The major resolutions are shown below:

2022 Resolution of the Board

2021 Resolution of the Board

2020 Resolution of the Board

Board Performance Evaluation

Regulation

The Board of the Company resolved to establish the “Regulations Governing the Evaluation of Board Performance” on 2019.03.19 thereby the performance of the Board will be subject to evaluation once annually. An external evaluation will also be conducted by an external professional and independent institutions or a team of scholars and experts once every 3 years.

The evaluation scope includes the Board of Directors, individual board members, and functional committees. The evaluation results should be completed and reported to the Board of Directors before the end of the first quarter of the following year.

The most recent implementation of both internal and external performance evaluations is as follows:

Self Performance Evaluation

An internal performance evaluation was conducted in 2023, and the evaluation results were reported to the Board of Directors in the first quarter of 2024.

Evaluation period: January 1, 2023, to December 31, 2023.
Evaluation method: Questionnaire.
The Human Resources Department distributed the official questionnaire from the Taiwan Stock Exchange to the Board of Directors, board members, and functional committee members.
Evaluation results: Excellent.

The Board of Directors and members of various functional committees provided suggestions and improvement actions for the future, including:

1. For important future matters, continue to maintain thorough communication with committee members to ensure they can adequately evaluate or monitor potential risks, thereby enhancing the quality of decision-making.
2. Considering the characteristics of the company’s industry and overall development direction, it is recommended that the Board of Directors gradually implement optimization of the selection and promotion of board members and a management succession plan.

External Performance Evaluation

The 2021 external performance evaluation results were presented to the Board of DirectorsIn in 2022Q1.

The execution of the evaluation is as follows:

Evaluation Organization: The Chinese Association for Corporate Governance
Evaluation Scope: December 1, 2020, to November 30, 2021.
Evaluation Method: Questionnaire and video interviews.
The evaluation team (comprising 2 committee members, 1 director, and 1 researcher) conducted the assessment across 8 key areas: composition, guidance, delegation of authority, supervision, communication, self-discipline, risk management, and meeting support.
Summary of Overall Evaluation:

1. It is rare and commendable to invite professionals with international experience in telecommunications industry management to serve as independent directors and as the chairperson of the Compensation and Remuneration Committee.
2. Their contributions help strengthen the Board’s strategic guidance and operational oversight functions.
3. The results of the corporate governance evaluation and proposed improvements were compiled and presented to the Board for review and discussion, demonstrating the Board’s accountability regarding corporate governance issues.
4. In the past two years, the company’s corporate governance evaluation has maintained a ranking between the top 6% and 20% of listed companies. Considering the company’s scale and the market challenges it faces, this is a commendable corporate governance performance.
5. The initiative to invite a third-party professional independent organization to assist in conducting the Board’s performance evaluation shows the company’s ambition to enhance its Board's performance through independent and objective review, offering valuable improvement suggestions.

Summary of Suggestions and Improvement Plans:

Suggestion	Improvement Plan or Action
It is recommended to consider establishing a Sustainability Committee in the next term of the Board or creating a sustainability-focused committee within the management department, which can be appropriately linked to the Board, to focus on key issues related to the company’s sustainable development.	The Sustainability Development Committee was established in March 2024.
To strengthen the independence of internal auditing, it is suggested that the annual performance evaluation of the internal audit supervisor involve participation from the Audit Committee members.	It is planned to invite Audit Committee members to participate in the internal audit supervisor’s annual performance evaluation starting in 2025.
It is suggested to review and integrate the existing whistleblowing policies and systems, ensuring that Audit Committee members can promptly and effectively grasp critical whistleblowing incidents from key stakeholders and take necessary actions to further implement the whistleblower system.	The company has set up a whistleblowing mailbox and hotline on the company’s website.

The 2021 external performance evaluation results were presented to the Board of DirectorsIn in 2022Q1.

The execution of the evaluation is as follows:

Evaluation Organization: Taiwan Corporate Governance Evaluation Association.
Evaluation Scope: January 1, 2022, to September 30, 2024.
Evaluation Method: In-person or video interviews.
The evaluation team (including committee members Professor Lin Hsiu-Wei, Professor Yang Sheng-Yong, and CPA Wang Chao-Ming) conducted evaluations in the following areas:
(1) Board composition and structure,
(2) Appointment and ongoing education of directors,
(3) Board involvement in company operations,
(4) Enhancing decision-making quality of the Board,
(5) Internal control,
(6) Environmental, social, and governance (ESG), and
(7) Value creation.
Independence:

The evaluation team referred to relevant professional ethical standards and maintained complete independence from the company.
The evaluators and their spouses do not serve as directors of the company or hold any other positions that may directly and significantly affect the results of this evaluation report.
There is no familial relationship, either by marriage or direct blood relation, between the evaluators and the company’s directors (including direct or collateral kin within two generations).

Summary of Overall Evaluation:
1. The professional composition of the Board of Directors aligns with the needs of the company’s operational development and strategic goals.
2. A succession plan for key management personnel has been formulated and effectively implemented to ensure the company’s sustainable operations.
3. A competitive executive compensation system has been established.
4. Regular reports on integrity management policies and their implementation are made to the Board of Directors.
5. The Board of Directors conducts regular performance evaluations, and both internal and external evaluation results are reported to the Board, demonstrating the Board’s self-discipline and accountability.
6. A Sustainability Development Committee has been established, with regular annual reports on its performance and plans presented to the Board.

Summary of Suggestions and Improvement Plans:

Suggestion	Improvement Plan or Action
It is recommended that the internal audit supervisor have at least two separate communications with independent directors annually, with records kept.	The internal audit supervisor will have two separate communications with independent directors each year, and records will be made.
It is recommended that the Chief Information Security Officer (CISO) report on the information security management status to the Board annually.	The internal audit supervisor will report on audit operations and, at the same time, present the information security management status to the Board.
It is recommended that the executive compensation system be linked to key performance indicators related to Environmental, Social, and Governance (ESG).	The compensation system will be revised to link executive compensation to key ESG performance indicators.

Succession planning for board members and the managerial officers

Succession planning for board members

There are 7 directors (including 3 independent directors) in the company. All of the directors have extensive industry practice or professional financial accounting experience. Also, they have long-term practical management experience. In the future, the composition structure and member experience background of the company’s board of directors will continue to be selected by the current method. Regarding the succession planning of the board of directors, in addition to the company's existing managerial officers, the company's major shareholders have also been working in the communications industry for a long time. There are sufficient talent pools to take over future director vacancies. As for the part of independent directors, the company is fully in line with the domestic and foreign communication markets. There is sufficient talent pool to take over the future director vacancies. The supply of this part of the domestic professionals is not scarce, so the succession of independent directors may come from the company's planning Industry or academia.

In 2020, the independent director of the company, Ms. Mary Shio Chan, resigned as a director of the company due to personal career planning. The company adopted the talent pool that the directors have cultivated for a long time in the communications industry. Through a rigorous selection process, the 2020 shareholders meeting elected Mr. Golub Drakulovic, who has a rich background in the wireless communication industry, serves as an independent director of the company. In addition, due to the unexpected death of the original independent director Mr. Liu during his term of office, the 2021 shareholders meeting elected Mr. Jong Wang as an independent director. He has deep legal expertise and industrial work experience, which can further strengthen the functions of the board of directors.

After the first generation of 8 founders gradually retired, the company started the succession planning work. Cultivated the outstanding senior managers to join the board of directors to familiarize themselves with the operation of the board of directors, and expand their participation in the work of the group's operating units. Among them, with his outstanding performance, Mr. Allen Yen was handed over by one of the former founders, Mr. Chi Hsieh, to become the chairman of the company after the 2019 shareholders meeting. Mr. Chi Hsieh still serves as the director and honorary chairman of the company. Mr. Allen Yen passed away in 2022. Mr. Chi Hsieh was elected to be chairperson.

Succession planning for the managerial officers

The primary management level are currently 15 people including all departments of the company. All of them are actively cultivated by the company. Department heads have work manuals and work standard operating procedures, and designate job agents for training. In addition, the company also encourages important management levels to take on-the-job training or participate in education and training provided by external to enhance their overall abilities. Based on future development and various investment plans, the company conducts cross-departmental cooperation training for key talents. Hoping to cultivate the versatility of succession talents to facilitate the smooth progress of future succession plans.

According to the MTI’s succession plan, General Manager Eugene Wu acts as CEO approved by Board of Directors on December 15, 2021.

In 2023, the company promoted one high-level managers, Paddy Yang(Director of PM Department), in order to strengthen the functions of each department and complete succession planning.