NANPAO Structure of Board of Director

Directors’ Professional Qualifications and Independent Directors’ Independence Status

For the nomination and election of Directors, the Director election procedures are undertaken in accordance with the Company Act and the relevant regulations in a fair, just and transparent manner. The composition of the Board of Directors shall take into consideration the organizational culture, business model and long-term development, as well as implementing the diversity policy for the Board members. The Board members shall possess the knowledge, skills and competence required for performing their duties. Of which, they shall possess capabilities in the following fields, namely business judgment, accounting and financial analysis, business management, crisis management, industrial knowledge, international market perspective, leadership and decision-making.

 

The Board of Directors at Nan Pao is led by Chairman WuCheng-Hsien. The board receives quarterly reports from the management team, covering operational performance, environmental safety, investment outcomes, and more. Additionally, appropriate recommendations are provided concerning the business strategies proposed by the management team. There is a smooth communication channel between the management team and the board, dedicated to achieving the company's objectives and maximizing benefits for stakeholders.

 

 

Criteria 　　　　　　         Name	Professional Qualification and Experience	Independent Directors’ Independence Status	Number of Other Taiwanese Public Companies Concurrently Serving as an Independent Director
Cheng-Hsien, Wu	1. Mr. Cheng-Hsien, Wu obtained a M.S. degree in Applied Chemistry from National Tsing Hua University Mr. Wu and has over 40 years work experience. Since joined the Nan Pao Research Department in 1977, he has served as the director of Bao Li Plant, the general manager of the R&D Department, the executive general manager of the Adhesive Business and general manager of Nan Pao.He served as the chairman of Nan Pao Resins Chemical Co., Ltd. from 2013. He is professionally proficient in industry knowledge and corporate operating leadership. 2. Without cases mentioned in various clauses of Article 30 of Company Law.	Not Applicable	0
Pou Chien Enterprise Co., Ltd. Representative: Yuan-Whang, Liao	1. Mr. Yuan-Whang, Liao obtained a M.S. degree from Cambridge University and has over 20 years of experience in banking and finance. He has served as the Chief Investment Officer of the Private Equity Department of Citibank Asia in Hong Kong and the Vice President of the Corporate Finance Department of Citibank in Taipei. He joined Pou Chen Group in 2010 as Executive Senior Manager of Global Supply Chain Management Head Office of Pou Chen Corporation. Mr. Liao currently serves as Director of San Fang Chemical Industry Co., Ltd. and Prosperous Industrial (Holdings) Ltd., and Executive Director of Pou Sheng International (Holdings) Limited. He is professionally proficient in industry knowledge, accounting, financial investment and business management. 2. Without cases mentioned in various clauses of Article 30 of Company Law.		0
Guang Rong Investment Ltd. Representative: Ming-Hsien, Hsu	1. Mr. Ming-Hsien, Hsu obtained a M.S. degree in Industrial Engineering from National Cheng Kung Universityand has over 30 years work experience. Since joined the Nan Pao Enterprise Management Office in 1986, he has served as manager of the General Management Office and deputy general manager of the Planning Office. He served as the CEO of Nan Pao Resins Chemical Co., Ltd. from 2017. He is professionally proficient in industry knowledge, corporate operating leadershipand business strategy. 2. Without cases mentioned in various clauses of Article 30 of Company Law.		0
Guang Rong Investment Ltd. Representative: Ying-Lin, Huang	1. Mr. Ying-Lin, Huang obtained a M.S. degree in Applied Chemistry from Waseda Universityin Japan and currently serves as the Executive General Manager of Sports Goods Adhesives and Materials Business Division of Nan Pao Resins Chemical Co., Ltd. and Director of Advant Analytics Tactics Ltd., Apogee Optocom Co., Ltd., Ferrule Precision Co., Ltd., and Opulence Optronics Co., Ltd. He is professionally proficient in industry knowledge. 2. Without cases mentioned in various clauses of Article 30 of Company Law.		0
Yun, Chen	1. Mr. Yun, Chen graduated from Industrial Chemistry of Tung Hai University and subsequently obtained a M.S. degree in Macromolecule from National Tsing Hua University and a Ph.D. degree in Synthetic Chemistry, Faculty of Engineering from University of Tokyo, Japan. Mr. Chen has over 40 years work experience.He has served as DistinguishedProfessor of National Cheng Kung University and currently serves as Honorary Professor of National Cheng Kung University. He is professionally proficient in industry knowledge. 2. Without cases mentioned in various clauses of Article 30 of Company Law.	All of the following situations apply to each and every of the Independent Directors: ØSatisfy the requirements of Article 14-2 of“Securities and Exchange Act” and Article 3 of“Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies” issued by Taiwan’s Securities and Futures Bureau; ØI (or under other's name), my spouse and minor children do not hold any number of issued shares of the Company; ØDo not provide commercial, legal, financial, accounting or related services to the Company or any affiliate of the Company in the past 2 years.r	0
Yung-Cheng, Chiang	1. Mr. Yung-Cheng, Chiang graduated from Faculty of Law of Soochow Universityand has over 30 years work experience. He has served as Judge of Taiwan Kaohsiung District Court and Taiwan High Court Kaohsiung Branch Court.Currently he serves as the lawyer of Attorney of Cheng Bang & Cheng Yang Joint Law Firm. Mr. Chiang had more than 24 years of experience practicing in a law firm. Furthermore, he served as Independent Director of Long Da Construction & Development Corporation, Taiwan Secom Co., Ltd. and Top High Image Corp. 2. Without cases mentioned in various clauses of Article 30 of Company Law.		3
Jing-Jung, Kuo	1. Ms. Jing-Jung, Kuo graduated from Industrial and Information Management Institute of National Cheng Kung University and subsequently obtained a Ph.D. degree in Accounting from Southern Illinois University. Ms. Kuo has over 30 years work experience. He has served as Director and Supervisor of National Federation of Certified Public Accountants of the Republic of China and Deputy Chairman of Accounting and Auditing Committee of Taipei Institute of Certified Public Accountants. Currently he serves as Director of RSM Taiwan, Chairman of Corporate Legal Person Accounting and Auditing Committee of Taiwan Institute of Certified Public Accountants, Adjunct Assistant Professor of Department of Accounting, Tamkang University, Director of Guang Yi Development Enterprise Co., Ltd. and Independent Director of Cystech Electronics Corp. She is professionally proficient in accounting, financial management and financial investment. 2. Without cases mentioned in various clauses of Article 30 of Company Law.		1

 

Diversification of the Board

In line with the policy of membership diversification for the board of directors, as stipulated in the "Corporate Governance Best Practice Principles." Include but not restrict the following two standards:

(1)Basic condition: gender, age, nationality, race and culture, etc.

(2)Professional knowledge and skill: professional background (such as law, accounting, industry, finance, marketing or technology), professional skill and industrial experience.

 

The Company select 7 directors (including 3 independent directors) at 2020 Shareholders' Meeting. The members of the board are all outstanding figures in industry and academia, boasting mutually complemented industrial experience, as well as expertise in finance, accounting and law, meeting the diversified board management goals.

 

Management targets： (1)At least 1 female director of the board members；    (2)More than one-third of the board seats are independent directors； (3)Directors concurrently act as managerial officers shall not be more than one-third of the board seats； (4)No more than two directors have a marital relationship, or a relative within the second degree of kinship to any other director of the Company.	Target achievements： (1)The board members do not include female directors and will be elected in 2023； (2)The proportion of independent directors is 42.86%； (3)Directors concurrently act as managerial officers is 14.29%；   (4)No directors have a marital relationship, or a relative within the second degree of kinship to any other director of the Company.	-
		Achieved
		Achieved
		Achieved
		Achieved

 

Implement the Policy of Diversification in the Board

  

Divercification Core Items                            Name

Basic Condition and Value

Date First Appoint-ment

Tenure of Indepen-dent Directors

Employed by Nan Pao

Concurrently Serve as Manager

Professional Knowledge and Expertise

Industrial Experience

Gender

Age

Nationality

Industry Expierence

Leadership

Financial Management

ESG

Supervision

Accounting

Legal

Chemical Engineering

Finance and Accounting

Cheng-Hsien, Wu

Male

71-80

ROC

20140627

ü

ü

ü

ü

Ming-Hsien, Hsu

Male

61-70

ROC

20140627

ü

ü

ü

ü

ü

ü

Ying-Ling, Huang

Male

31-40

ROC

20200616

ü

ü

ü

ü

ü

Yuan-Whang, Liao

Male

51-60

ROC

20221006

ü

ü

ü

ü

Yun, Chen (Independent Director)

Male

71-80

ROC

20171212

7-9 year

ü

ü

ü

Yung-Cheng, Chiang (Independent Director)

Male

61-70

ROC

20171212

7-9 year

ü

ü

ü

Jing-Jung, Kuo (Independent Director)

Male

51-60

ROC

20230621

1-3 year

ü

ü

ü

ü

ü

 

Independence of the Board

The board of the Company is independent:

(1)7 seats include 3 independent directors (42.86%). All independent directors meet the independence conditions of the "Measures for the Appointment of Independent Directors of Public Offering Companies and Matters to Be Followed".

(2)The tenure of the independent directors shall not exceed acumulative term limit of three years and no independent director may concurrently serve as an independent director of more than three other public companies. Two independent directors have a cumulative term of 7-9 years, while one independent director has a cumulative term of 1-3 years.

(3)There is no spouse or second-degree relative relationship between directors (there is no circumstance specified in Item 3 and Item 4 of Article 26-3 of the Securities Exchange Act).

(4)All directors uphold a high degree of self-discipline. In case involving interests of their or of the legal entities that they represent, they shall explain key contents of the involvement at the board meeting. They shall voluntarily abstain from discussion and voting as well as evade during discussion and voting, for themselves or proxy for another director, on a proposal submitted to the board that risks the involvement of the director's own interest to the detriment of the interest of the Company (please refer to Page 30~31 The implementation of recusal of Directors on conflict of interests).

 

Succession Planning

The Company's "Articles of Association" stipulate a comprehensive candidate nomination system for the election of directors. In accordance with the "Corporate Governance Code of Practice" and the "Procedure for Election of Directors," the company implements a policy to diversify the composition of the board of directors. Currently, there are a total of 7 directors, including 3 independent directors, who possess diverse and complementary industry experience, as well as expertise in law, accounting, finance, and other professional capabilities. Among them, 3 directors also hold positions in the company's senior management.The current Chairman of the Board, Mr. Wu Cheng-Hsien, joined the Nan Pao Resins in the Research Department in 1977. He has held various positions, including Plant Manager of Pao Li Factory, General Manager of the Research Department, Executive General Manager of the Adhesive Business Division, and General Manager. In 2014, he joined the Board of Directors and assumed the position of Chairman in 2014.The future composition and member background of the company's board of directors will continue the current structure.

 

The company continues its director succession plan, initially identifying general managers of each subsidiary as potential successors. Considering the following criteria, the company is gradually establishing a database of director candidates:

• Align with the company's policy on the diversity of board members.
• Demonstrate integrity, accountability, innovation, and decision-making skills in line with the core values of the company.Possess professional knowledge and skills that contribute to the company's operational and managerial excellence.
• Have relevant industry experience related to the company's business.

 

The company also explicitly defines the "Procedures for Performance Evaluation of the Board of Directors". Through the evaluation of performance metrics, including understanding and awareness of the company's responsibilities, involvement in the company's operations, directors' professionalism and ongoing education, and internal control, it confirms the effective operation of the board of directors. This evaluation is used to assess the performance of directors as a reference for future director selection.

 

Taking into account the comprehensive considerations and selection criteria mentioned above, the company has identified a successor for the position of Chairman. The transition is scheduled to take place within the next 2-3 years.