Business Integrity and Insider Trading Prevention
Business Integrity and Ethic
Business Integrity and Ethic
As stipulated in the Everlight Chemical Business Philosophy and Principle Whitepaper, Everlight Chemical is committed to operating with business integrity and regulatory compliance. With “Business by Integrity” as one of our core philosophies, we steadfastly ensure compliance with regulations and corporate ethical standards both at home and abroad.
Policy & Commitment
- The Company has formulated the Ethical Corporate Management Best Practice Principles and Procedures for Ethical Management and Guidelines for Conduct. At Everlight Chemical, we embrace the principles of integrity, transparency and accountability in our business operations. We have established policies grounded in business integrity as well as sound corporate governance and risk management mechanisms to ensure sustainable operations. The board and management team actively fulfill the Company’s commitment to business integrity, requiring all employees throughout the Company, from directors to employees, to abide by strict ethical standards, including prohibiting the acceptance of offering of any improper benefits, and ensuring employees have clear rules of conduct to follow.
- Our ethical management policies set forth clear guidelines to ensure business integrity as well as plans to prevent unethical practices. We have also established a whistleblowing system for reporting violations of ethical corporate management rules and a complaint mechanism. Those found to have violated the policy are subject to disciplinary action in accordance with company policies.
- The Company has established effective accounting and internal control systems that explicitly prohibit bribery, unlawful political contributions, conflicts of interest, improper dealings with third parties and other activities that involve high risks of unethical behavior. We also regularly conduct educational training to strengthen the implementation of our business integrity policies.
Measures to Prevent Conflicts of Interest
In compliance with applicable laws and regulations, Everlight Chemical has formulated guidelines and procedures for the prevention and management of conflicts of interest that also cover the highest governance body at the Company. For more details, please visit our official website
1. We have established the Procedures for Prevention of Insider Trading to protect the rights and interests of both investors and the Company.
2. We evaluate the track record of counterparties in terms of business integrity and ethical conduct and include integrity clauses in the contracts we sign with counterparties, which stipulate that we may terminate our contract with the counterparty at any time if unethical behavior is identified.
3. Board directors and executives are required to sign commitment letters in accordance with our corporate ethical management rules. All 11 board members have signed the “Statement of Compliance with Business Integrity Policy” and “Confidentiality Commitment Letter for Directors.” All 30 executives have signed the “Statement of Compliance with Business Integrity Policy” and “Confidentiality Commitment Letter for Managers.”
4. We have established the Rules Governing Financial and Business Matters Between the Corporation and Related Parties in accordance with our Corporate Governance Best Practice Principles, stipulating clear rules to prevent non-arm’s length transactions and improper channeling of interests with respect to the purchase and sale of goods, the acquisition and disposal of assets, the provision of endorsements and guarantees, and loans of funds between the Company and related parties (including board members).
5. The Company’s Rules and Procedures for Board Meetings stipulate that where a matter presented at the board meeting concerns the personal interest of a director or the interest of the juristic person represented by the director, and where the director’s participation can prejudice the interest of the Company, the concerned director shall recuse himself/herself from the discussion and voting on the matter.
6. We have appointed the Human Resources Division as the designated body for business integrity management. Also, a Corporate Governance Officer has been appointed, as required by law, to facilitate related measures and regularly report implementation results to the board.
2. We evaluate the track record of counterparties in terms of business integrity and ethical conduct and include integrity clauses in the contracts we sign with counterparties, which stipulate that we may terminate our contract with the counterparty at any time if unethical behavior is identified.
3. Board directors and executives are required to sign commitment letters in accordance with our corporate ethical management rules. All 11 board members have signed the “Statement of Compliance with Business Integrity Policy” and “Confidentiality Commitment Letter for Directors.” All 30 executives have signed the “Statement of Compliance with Business Integrity Policy” and “Confidentiality Commitment Letter for Managers.”
4. We have established the Rules Governing Financial and Business Matters Between the Corporation and Related Parties in accordance with our Corporate Governance Best Practice Principles, stipulating clear rules to prevent non-arm’s length transactions and improper channeling of interests with respect to the purchase and sale of goods, the acquisition and disposal of assets, the provision of endorsements and guarantees, and loans of funds between the Company and related parties (including board members).
5. The Company’s Rules and Procedures for Board Meetings stipulate that where a matter presented at the board meeting concerns the personal interest of a director or the interest of the juristic person represented by the director, and where the director’s participation can prejudice the interest of the Company, the concerned director shall recuse himself/herself from the discussion and voting on the matter.
6. We have appointed the Human Resources Division as the designated body for business integrity management. Also, a Corporate Governance Officer has been appointed, as required by law, to facilitate related measures and regularly report implementation results to the board.
Accounting and Internal Control System
Everlight Chemical has established effective accounting and internal control systems to address activities that involve high risks of unethical behavior. The Company also conducts regular internal audits in accordance with the law and reports the results to the board.
Regular education and training on Business Integrity:Internal education and training sessions on business integrity are held annually.
Training on Insider Trading Prevention Policies: We conduct educational training at least once a year to educate directors, managers and employees on the Company’s Procedures for Prevention of Insider Trading and relevant regulations.
Training on Insider Trading Prevention Policies: We conduct educational training at least once a year to educate directors, managers and employees on the Company’s Procedures for Prevention of Insider Trading and relevant regulations.
Prevention of Insider Trading and Conflicts of Interest
- Everlight Chemical has established the Procedures for Prevention of Insider Trading to protect the rights and interests of both investors and the Company.
- From 2022 onwards, directors are notified via text message that they are prohibited from trading their shares during the blackout periods, which include the 30 days prior to the release of the Company’s annual financial statements and the 15 days prior to the release of the Company’s quarterly financial reports.
- We conduct awareness training at least once a year to educate directors, managers and employees on the Company’s insider trading prevention procedures as well as relevant regulations. Newly appointed directors and managers are scheduled to receive the same training within three months of assuming their positions, and new hires receive the training during orientation training.
Implementation Results in 2022
As part of the insider trading prevention training, a five-minute educational video about our Procedures for Prevention of Insider Trading was played to incumbent directors (on August 11, 2022) and managers and employees (at monthly meetings in August 2022). A total of 1,165 people finished this training, representing a 100% training completion rate and a total training hour of 97 hours.
The Company also has other guidelines and measures in place to prevent and manage conflicts of interest at the highest governance body.
Anti-Corruption, Anti-Competitive, Antitrust and Monopoly Practices
Everlight Chemical has established clear anti-corruption and anti-bribery policies and guidelines and conducts relevant employee training and education on a regular basis. In 2022, all 24 plants and 11 subsidiaries conducted assessments on corruption-related risks in their internal control system, and no business activity involving corruption risk had been identified.
“No violations of policies or regulations related to anti-corruption, anti-competitive, antitrust or monopoly occurred in 2022.”
Whistleblowing System
Policy & Commitment
- Everlight Chemical has established a whistleblowing system for reporting violations of ethical corporate management rules, with the Audit Office as the responsible unit for handling complaints. We have set up a dedicated phone line and email address for reports of any suspected wrongdoing. The email address of the Audit Committee is also available.
- Upon receiving a complaint, the Audit Office shall document the case and perform preliminary review, based on which the Audit Office should determine, within three days of receipt, whether to proceed with the case and initiate an investigation.
- The whistleblowing system clearly defines the procedures for handling reports and the confidentiality measures required to protect individuals involved.
- The Company accepts anonymous reports and protects the identity and information submitted by whistleblowers. The Company is also committed to protecting whistleblowers from any form of retaliation.
Whistleblowing Channels
Phone: +886-2-2326-3502
Dedicated Whistleblowing Mailbox:
[email protected]
Email Address of Audit Committee:
[email protected]
No complaint was received in 2022.
Internal Audit System and Operation
All internal audit items for the year 2022 have been completed.
To assist the board and executives in overseeing corporate governance and to strengthen internal controls and auditing, the Company’s Audit Office reports directly to the board. The Audit Office consists of a General Auditor and two auditors. The scope of internal audits encompasses the design and implementation of internal controls and the review of self-assessment of internal controls. The Company’s internal audit operations include the following:
- Before the end of each year, potential risk factors are identified through the “Risk Assessment Form for Internal Audit Planning.” A risk level is assigned based on assessment on the level of impact and effectiveness of internal controls. The annual audit plan is formulated based on the risk assessment results and submitted for approval by the Audit Committee and the board. The audit plan is then filed in accordance with the law.
- The implementation process of scheduled and project-based audits includes the following steps: conduct pre-audit meetings, perform audit work, prepare internal audit reports and recommendations, convene exit conferences, and present audit reports.
- Monthly internal audit reports and quarterly follow-up audit reports are submitted to independent directors for review and approval. The General Auditor attends and presents on the implementation progress of internal audits at related board and Audit Committee meetings.
- In 2022, each unit and department conducted self-assessment on the design and effectiveness of internal controls using an online platform. Senior managers then reviewed the self-assessment reports and issued their assessment and recommendations, which were reviewed and consolidated into the Internal Control Self-Assessment and Diagnostic Report by the Audit Office. The report served as the primary basis for the board’s evaluation on the effectiveness of the Company’s internal control system as well as the basis for the issuance of the Statement of Internal Control.
- Key Audit Focuses in 2022
Audit Item
Audit Focus and Description
Regulatory and Compliance Matters
Understanding of and compliance with applicable laws and regulations at each unit and department
Production Cycle
Chemical and production safety management
Sales and Collection Cycle
Management of accounts receivable and collection of doubtful debts
Payroll and Personnel Cycle
Recruitment and employee retention, payroll calculation and disbursement process
Computer Operations Management
Firewall policy and access management
Oversight and Management of Subsidiaries
Seal management
2022 Business Integrity & Ethics Performance
Anti-Corruption & Business Integrity Training
We have published our Ethical Corporate Management Best Practice Principles and Policy for the Whistleblowing System for reporting violations of ethical corporate management rules on our official website, available in both Chinese and English for internal and external reference.
Training on Ethical Corporate Management Best Practice Principles
1,650 people completed the training, representing a 100% training completion rate.
Training on Whistleblowing System for Reporting Unethical Behavior
Training for all directors was completed on August 11, 2022. An educational video on the topic was played to all employees at 20 monthly meetings. 1,650 people completed the training, representing 137.5 training hours and a 100% training completion rate.
Communicating Our Business Integrity and Anti-Corruption Policy to Suppliers and Contractors
We have communicated our ethical corporate management policy with 457 contractors/suppliers, which account for 89% of all business partners (515) we work with. We will continue to work towards the goal of reaching 100% .
Type | Supplier | Contractor | Total | ||||||
Location | Total Number of Suppliers | Number of Suppliers Reached | Percentage | Total Number of Suppliers | Number of Suppliers Reached | Percentage | Total Number of Suppliers | Number of Suppliers Reached | Percentage |
Headquarters | 33 | 25 | 75% | 23 | 23 | 100% | 56 | 48 | 85% |
Plant I | 40 | 29 | 73% | 70 | 70 | 100% | 110 | 99 | 90% |
Plant II | 45 | 21 | 47% | 162 | 162 | 100% | 207 | 183 | 88% |
Plant III | 33 | 18 | 54% | 89 | 89 | 100% | 122 | 107 | 87% |
Plant IV | 2 | 2 | 100% | 18 | 18 | 100% | 20 | 20 | 100% |
Total | 153 | 95 | 62% | 362 | 362 | 100% | 515 | 457 | 89% |
Note: For the Supplier category, targets for policy communication were suppliers whose annual procurement value exceeded NT$500,000.