China Steel Chemical Corp

While corporate governance is the foundation for corporate sustainability, a sound corporate system is an essential condition for corporate governance. The Financial Supervisory Commission has been promoting Corporate Governance 3.0 over the past years in an effort to enhance the practical operation of corporate governance in Taiwan. As a public listed company, we have not only established a corporate governance structure and practice corporate governance in accordance with the Company Act, the Securities and Exchange Act, and other related laws and regulations, but also work with the government on various corporate governance measures, with the aim of safeguarding shareholders' interests and rights, strengthening the functions of the Board of Directors and various functional committees, respecting stakeholders' rights, and enhancing information transparency. [...] Ethical Corporate Management - CSCC has instituted the Ethical Corporate Management Best Practice Principles and the Procedures for Ethical Management and Guidelines for Conduct, with the aim of implementing ethical corporate management based on the principles of honesty, fairness, trustworthiness, and transparency. Our ethical corporate management policy has been disclosed in our internal rules and regulations and annual reports and on our official website, so that our stakeholders, including managers, employees, suppliers, and customers, can learn about our ethical corporate management philosophy and standards. [...] Regulations on lobbying and invitations to social gatherings - According to CSCC's Guidelines for Handling Gifts and Invitations to Social Gatherings, employees shall refuse or return any gifts from people with an interest in the performance of their duties; in the event that such gifts cannot be returned, employees shall report the gifts to first-level managers or above and send the gifts to the Administration Department for registration and safekeeping. [...] Prohibition on political donations - In an effort to ensure that we are politically neutral and does not interfere with or sponsor any political organizations, our Procedures for Ethical Management and Guidelines for Conduct clearly stipulate that we shall not provide political donations. Hence, no political donations were made by CSCC in 2023.

While the Corporate Governance and Ethical Corporate Management Team is headed by the Chief Corporate Governance Officer, the Sustainable Environmental Development Team is led by the Vice President of the Production and Technology Department, the Employee Care and Social Engagement Team is led by the Vice President of Administration and Commercial Department, and the Risk Management Team is led by the President. These teams may set up a number of working groups, with the relevant tasks to be carried out by first-level units. At least two executive team meetings are held each year, with the President as the convener, to discuss the implementation of tasks related to the duties and responsibilities of this committee. Meetings can also be convened at any time when necessary. A report on implementation outcomes has to be submitted every six months, while an implementation plan for the following year has to be presented at the end of the current year. [...] The Corporate Governance and Sustainability Committee identified six categories of stakeholders, namely shareholders, customers and trading partners, employees and labor union, suppliers and contractors, community and local groups, and central and local governments, based on five principles (i.e., dependency, responsibility, tension, influence, and diverse perspectives). [...] Our short-, medium-, and long-term strategic goals are adjusted on a rolling basis each year. After each responsible unit reports their annual implementation outcomes to the Corporate Governance and Sustainability Committee, the outcomes will then be reported by the Corporate Governance and Sustainability Committee to the Board of Directors and included in the performance evaluation for managers. Actual performances related to the aforesaid goals have been disclosed in our previous reports.