Board of Director Performance Evaluation

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Board of Director Performance Evaluation

For effective corporate governance and better board performance, the Company has formulated the “Regulations on Board of Director Performance Evaluation” passed in the Board meeting on August 10, 2017, and it stipulates an internal performance evaluation for the Board once every year and an external evaluation every three years.

SYSTEX sends an internal Board Self-Assessment Questionnaire in December each year and reports the results of the evaluation at the latest Board meeting in the following year. The results of 2023 internal evaluation were presented to the Board on February 27, 2024.

Internal Directors Performance Evaluation

The Internal Performance Evaluation for the past 2 years is as follows:

2023 Internal Performance Evaluation
2022 Internal Performance Evaluation

The results of 2023 internal evaluation were presented to the Board on February 27, 2024.

	Internal Evaluation
Evaluation cycles	Once a year
Evaluation periods	Year 2023 from January 1 to December 31
Scope of evaluation	Evaluation scope covers the evaluation of the board as a whole, individual directors and functional committees.
Method of evaluation	Methods of inside evaluations include the internal evaluation of the board and functional committees, self-evaluation by individual board members.
Indexes of evaluation	1. The board of directors, which should cover: Participation in the operation of the company; Improvement of the quality of the board of directors’ decision making; Composition and structure of the board of directors; Election and continuing education of the directors; Internal control. There are a total of 27 board performance evaluation items, with converted scores ranging from 91.11 to 100 points, with an average score of 99.20 points. 2. The board members, which should cover: Alignment of the goals and missions of the company; Awareness of the duties of a director; Participation in the operation of the company; Management of internal relationship and communication; The director’s professionalism and continuing education; Internal control. There are 19 performance evaluation items for board members, with converted scores ranging from 90.53 to 100 points, with an average score of 99.19 points. 3. Functional committees , which should cover: Participation in the operation of the company; Awareness of the duties of the functional committee; Improvement of quality of decisions made by the functional committee; Makeup of the functional committee and election of its members ; Internal control. * There are a total 19 performance evaluation items of Audit Committee, with converted scores ranging from 90.53 to 100 points, with an average score of 97.37 points. *There are a total of 14 performance evaluation items of the Remuneration Committee, with converted scores ranging from 92.86 to 100 points, with an average score of 97.62 points.
Result of evaluation	If a score of 80 points is deemed to meet standards, the results of performance evaluation for the Company’s Board of Directors, Audit Committee, Remuneration Committee, and individual Directors were all above 80 points, demonstrating the satisfactory overall operations of the Board that is in line with the Company’s corporate governance principles.

The results of 2022 internal evaluation were presented to the Board on February 22, 2023.

	Internal Evaluation
Evaluation cycles	Once a year
Evaluation periods	Year 2022 from January 1 to December 31
Scope of evaluation	Evaluation scope covers the evaluation of the board as a whole, individual directors and functional committees.
Method of evaluation	Methods of inside evaluations include the internal evaluation of the board and functional committees, self-evaluation by individual board members.
Indexes of evaluation	1. The board of directors, which should cover: Participation in the operation of the company; Improvement of the quality of the board of directors’ decision making; Composition and structure of the board of directors; Election and continuing education of the directors; Internal control. There are a total of 27 board performance evaluation items, with converted scores ranging from 90.37 to 100 points, with an average score of 98.09 points. 2. The board members, which should cover: Alignment of the goals and missions of the company; Awareness of the duties of a director; Participation in the operation of the company; Management of internal relationship and communication; The director’s professionalism and continuing education; Internal control. There are 19 performance evaluation items for board members, with converted scores ranging from 90.53 to 100 points, with an average score of 99.04 points. 3. Functional committees , which should cover: Participation in the operation of the company; Awareness of the duties of the functional committee; Improvement of quality of decisions made by the functional committee; Makeup of the functional committee and election of its members ; Internal control. There are a total 19 performance evaluation items of Audit Committee, with converted scores ranging from 92.63 to 100 points, with an average score of 97.54 points. There are a total of 14 performance evaluation items of the Remuneration Committee, with converted scores ranging from 92.86 to 100 points, with an average score of 97.62 points.
Result of evaluation	If a score of 80 points is deemed to meet standards, the results of performance evaluation for the Company’s Board of Directors, Audit Committee, Remuneration Committee, and individual Directors were all above 80 points, demonstrating the satisfactory overall operations of the Board that is in line with the Company’s corporate governance principles.

External Directors Performance Evaluation

In July 2021, the Taiwan Corporate Governance Association was appointed to perform the 2021 external board effectiveness evaluation (period from October 1, 2020 to September 30, 2021). The institution and executive experts have no business dealings with the company and are independent. Questionnaires and on-site inspections were used to evaluate the composition of the board of directors, guidance, authorization, supervision, communication, internal control and risk management, self-discipline and others. The Corporate Governance Association issued an assessment on November 25, 2021. Evaluate the board effectiveness evaluation report and distribute the report to all board members, and its recommendations and expected improvement measures have been submitted to the board report on February 23, 2022.

	External Evaluation
Evaluation cycles	Once three years
Evaluation periods	From October 1, 2020 to September 30, 2021
Scope of evaluation	Board of Directors
Method of evaluation	Appointed the Taiwan Corporate Governance Association to evaluate by means of questionnaires and on-site visits.
Indexes of evaluation	The composition, the guidance, the authorization, the supervision, the communication of the board of directors and internal control land risk, the self-discipline of directors, and other aspects (such as board meetings, support systems, etc.).

Measures taken to strengthen the functionality of the board:

In July 2021, the Taiwan Corporate Governance Association was appointed to perform the 2021 external board effectiveness evaluation (period from October 1, 2020 to September 30, 2021), for detailed evaluation information, please refer to pages 39~40 of the 2021 annual report.
According to the evaluation recommendations, the implementation improvement measures in 2022 are as follows:
1. In July 2022, the head of the business unit will conduct an information service industry market analysis and operational report to the members of the board of directors, so that the directors can have a deeper understanding of SYSTEX’s business content, operational planning and goals.
2. On August 3, 2022, the board of directors passed a resolution to formulate the ” Sustainable Development Best Practice Principles”, and set up a sustainable promotion team to supervise and manage the implementation of the project, and promote the coordination and cooperation of various departments in the company to promote sustainable development. Report the implementation results to the board of directors.
3. On December 21, 2022, the board of directors resolved to formulate the “Risk Management Best Practice Principles”, “Risk Management Policies and Procedures” and “Risk Management Committee Charter”, and on the same day approved the establishment of a cross-department “Risk Management Committee” to assist The board of directors communicates, reports and advises on risk management, with the aim of broadly influencing all employees and organizations through the decision-making process and the support actions of leaders due to the support of the decision-making layer for risk culture, and regularly reports the implementation of risk management to the board of directors every year.
The independence and suitability of certified accountants are regularly evaluated every year. The 2022 annual evaluation results have been submitted to the Audit Committee and the Board of Directors for consideration on December 21, 2022.
The Company elected three Independent Directors in the election of the 10th Board of Directors in the general shareholders’ meeting on May 26, 2022 and established the Audit Committee and the Remuneration Committee on the same day. The state of operations of The Audit Committee and the Remuneration Committee refer to page 40~44 and 55~56 of the 2022 annual report.
In 2022, a total of 6 hours of Directors’ continuing courses arranged in May and November respectively to meet the number of training hours recommended by the law.

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