Other Governance Information

The independence and suitability of CPAs

The Audit Committee of The Company regularly evaluates the independence and suitability of CPAs yearly, and submits the evaluation results to the Board of Directors. The evaluation mechanism is as follows:

  1. The CPAs of The Company are not related parties to The Company and the directors.
  2. The Company abides by the Corporate Governance Principles to handle the rotation of CPAs.
  3. Prior to the appointment of annual audit services, the firm of CPAs is required to obtain the approval of the Audit Committee. Before the appointment of non-audit services, the firm of CPAs shall confirm the requirements for independence are met and report to the independent directors in quarterly Audit Committee meeting.
  4. The CPAs shall report to the Audit Committee on the compliance with the independent standards and their review or audit results on a quarterly basis.
  5. Obtain an independent statement issued by CPAs on a regular basis.
  6. The Company includes the Audit Quality Indicators (AQIs) in the CPAs annual appointment evaluation and the CPAs are required to report with the Audit Committee accordingly.

 

The assessments in 2023 are as follows:

(1)The independence between the CPAs and The Company complies with the Accounting Act of the Republic of China, The Norm of Professional Ethics for

Certified Public Accountant and other relevant regulations.

(2)The Company has not appointed the same CPA for certification for five consecutive years.

(3)The annual evaluation was completed by the Audit Committee on February 7, 2023 and the result was reported to the Board of Directors and approved on February 8, 2023.

 

 

Full- (or part-) time unit of Corporate Social Responsibility and Ethical Corporate Management

Full- (or part-) time unit who sets into action and the operation and implementation status of the unit

Ethical Corporate Management

In order to improve the administration of integrity management and establish a corporate culture with integrity management, the company refers to “Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies.”

 

 "AUO Ethical Corporate Management Principles", which is the company's highest integrity policy, was approved by the board of directors in November, 2014.

 

According to "AUO Ethical Corporate Management Principles", the Company establishes “AUO Enterprise Integrity Policy” and “AUO Declaration Regulations for Conflict of Benefits”. HR Headquarter is responsible for formulating the ethical management policy and preventive measures as well as supervising their implementation and to report to the directors regarding the implements in the first board meeting each year.

 

The implements of the integrity operations include that each new employee is required to attend an advocacy session on AUO Integrity Policy and sign a declaration of integrity. In addition, Global Integrity Advocacy is held annually and the on-line compliance training courses are arranged. Furthermore, divisions that engage closely with suppliers or are involved in supplier affairs have been identified as in positions of high integrity risk, for which the employees of these divisions are required to undergo the report of conflict of interest. On the other hand, AUO’s suppliers and subcontractors are required to participate training courses or advocacy and sign a Statement of Compliance with AUO Supplier / Subcontractors Code of Conduct.

 

Among the above matters, through training, we arranges online integrity management training course for directors and all employees. Being regulated by the Listed OTC Company Management Principles, seven violations are listed in the course content. To enhance the promotion, engaging in business activities in accordance with applicable competition laws and regulations and prohibition on disclosing trade secrets are also included in the course.

 

The 2023 training course aims to promote compliance with relevant laws and regulations, including the Company Act, Securities and Exchange Act (including prevention of insider trading), Business Entity Accounting Act, Political Donations Act, Anti-Corruption Act, Government Procurement Act, Act on Recusal of Public Servants Due to Conflicts of Interest and other related acts. A total of 9 directors have completed the training, with a training duration of 2 hours. The education and training for all employees have be launched in December 2023, with a total of 36,915 participants worldwide (as of December 22, approximately 50% of employees in Taiwan have completed the training, and it is expected to reach 100% by February 2024).


In addition, a total of 905 individuals have completed the New Employee Integrity Course and signed the commitment. The course covers topics such as corporate integrity policies, insider trading laws, antitrust laws, and competition regulations. The signing rate is 100%, and the total training duration exceeds 150 hours.

 

In addition, The Global Integrity Advocacy is held every year. Integrity-related messages are announced by e-news, mail, and meeting to ensure that all employees, suppliers, and contractor understand the core AUO values on integrity.

 

To prevent unethical conduct, through the periodical supervision, anti-corruption employees are required to report any conflicts of interest each year. In 2023, 2,466 supervisors and employees in anti-corruption positions have reported and the reporting rate is 100%.

Corporate Social Responsibility

The balancing development of enterprise management and green sustainability is the philosophy of AUO's sustainable operation. While pursuing a robust corporate structure, it invests more long-term resources in environmental protection and social participation issues. The Sustainability Committee established in 2013 is AUO’s highest governing body for sustainable development, actively integrating the United Nations Sustainable Development Goals (SDGs) and corporate core competitive strategies, valuing value chain collaboration, and actively implementing global partnership relationships. It aims to be a leader in corporate sustainable development, focusing on creating more shared value.

 

In response to global climate actions towards net-zero carbon emissions in 2021, the Committee was renamed the ESG and Climate Committee. The ESG and Climate Committee is chaired by the Chairman of the Board and the Group Strategy Officer, with the position of Sustainability Officer, and is operated by the Sustainability Management Department. Based on the substantive importance of operations, eight sub-committees have been set up under its jurisdiction, led by Deputy General Managers as the chairpersons, to lead the sub-committees’ operations and cross-unit cooperation. Corporations will unfold the vision and blueprints into team goals and plans, review them monthly, report to the Chairman every quarter on significant decision-making issues, and report to the Board annually following the Sustainable Development Code. The chairperson of the "ESG and Climate Committee" reports to the board on the results of sustainable development and future work plans. In 2023, two reports were made to the board of directors, including the identification of sustainable issues that need attention, the formulation of responsive action plans, goal setting, and policy revision for sustainable issues. The board must evaluate the reasonableness and feasibility of strategies and goals, and regularly review the progress of strategy and goal promotion, to supervise the implementation of sustainable management matters, and urge the execution team to make necessary adjustments when needed.

 

In addition, in response to new current issues, sustainability policies and developments, discussions, creative thinking, and project resource communication are carried out irregularly through the Secretary Exchange Meeting.

 

Top 10 Shareholders

 Top 10 Shareholders (Record Date of 2023 shareholder’s meeting: 2023.3.28)

Shareholders’ Name

Holding Shares

Holding (%)

Qisda Corporation

530,878,896

6.90%

Trust Holding for Employees of AUO Corporation

398,849,222

5.18%

Quanta Computer Inc.

355,144,245

4.61%

Yuanta Taiwan Dividend Plus ETF

321,300,237

4.17%

ADR of AUO Corporation

187,493,055

2.44%

Nan Shan Life Insurance Co., Ltd.

124,830,800

1.62%

New Labor Pension Fund

119,913,800

1.56%

Vanguard Emerging Markets Stock Index Fund, a Series of Vanguard International Equity Index Funds

71,699,039

0.93%

JPMorgan Chase Bank N.A., Taipei Branch in custody for Vanguard Total International Stock Index Fund, a series of Vanguard Star Funds　

70,765,699

0.92%

iShares Core MSCI Emerging Markets ETF　

58,803,400

0.76%

 

 

Policy on Cross Shareholdings 

Policy on Cross Shareholdings

 

 

Cultural Development Achievements

AUO is committed to promoting a corporate culture that merges technology and humanities. We continuously support cultural development in various aspects such as business promotion, event organization, and the creation of a happy workplace. Specific examples for 2023 are as follows:

 

  1. Cultural Music Festival at Xidun Kiln Cultural Center

In 2020, AUO established the Xidun Kiln Cultural Center at our Taichung factory where we employ technology to recreate the kiln production process of the Qing Dynasty and to display the natural humanities of Dadu Mountain. The Cultural Center is a space where AUO shares experiences in preserving culture. Each year, we invest more than one million dollars in operating costs to offer guided tours by professional environmental educators, large-scale events, and reading courses. In May 2023, AUO will host a Cultural Music Festival at the Xidun Kiln Cultural Center, inviting employees, government officials, clients, suppliers, schools, communities, and the general public to immerse themselves in local culture through music concerts and lifestyle festivals.

  1. AUO's Life Feast

To foster a happy working environment and promote the amalgamation of work and life for employees, AUO organizes "life feasts," arts and culture events that cost over a million dollars each year. We invite experts from various fields to encourage employee participation and promote humanities literacy through exhibitions and speeches, providing them with a source of positive energy. In 2023, invited groups will include the Northern Lights Percussion Group and the Minghua Yuan Troupe.

  1. Supporting Indigenous Cultural Development

In the 2023 Touch Taiwan Exhibition, AUO will feature an exhibit showcasing the beauty of the Bunun Tribe singing around a campfire through our high-definition ALED technology and superior audio quality, investing over four million dollars to commemorate the beautiful eight-part polyphony, detailed starry sky, and Bunun tribal totems (Video link: https://www.youtube.com/watch?v=Y-QvXZf1G1Y)

  1. Other Art and Culture Event Sponsorships

AUO actively aligns with the art ecosystem and expands the possibilities of advanced display technologies in various fields. We have sponsored art curating events with a budget of 4.8 million dollars, including:

  • Taoyuan Science and Art Festival: Artists utilized the most advanced AI technology and combined it with AUO's FindARTs' 85” faux art screen and exclusive A.R.T. Advanced Reflectionless Technology, transcending hardware limitations and displaying an unseen effect with a painterly texture to audiences.
  • Double Fusion Domain AMBI SPACE ONE," Taiwan's first 5G+4K full-immersive digital performance: Featuring FindARTs' museum-grade art display technology to showcase realistic artist paintings and inviting audiences into a diverse exhibition space to experience top-quality sensory immersion.