The Taiwan Monthly

Jul. 2020

ESG

TWSE announces updated corporate governance templates in response to recent regulatory amendments and to improve quality of English disclosure

Following its announcement of the amended “Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies” and two other sets of amended guidelines on February 13, 2020, the TWSE responded to the amendments of the Company Act, the Securities and Exchange Act and subordinate regulations, and corporate governance guidelines for TWSE/TPEx listed companies since 2018 by releasing the amended “Sample Template for XXX Co., Ltd. Rules of Procedure for Shareholders Meetings” and 12 other amended templates on June 3. As part of the ongoing effort to improve corporate governance, the amendments provide a compliance guide for TWSE/TPEx listed companies and further align with global good practices.

 

To improve English disclosure quality for TWSE/TPEx listed companies, the TWSE has also updated the English simplified annual report template to provide a basis for TWSE/TPEx listed companies preparing their annual reports in English. Templates are intended to enhance Taiwan's capital market worldwide standards and to create a more friendly environment for international investors.

 

The TWSE states that in the interest of stronger corporate governance, it advises TWSE listed companies to, in addition to complying with the applicable regulations, look at the latest amendment of these templates and adopt the appropriate measures. Key points in the amendments include:

 

1.The templates, "Sample Template for XXX Co., Ltd. Rules of Procedure for Shareholders Meetings", "Sample Template for XXX Co., Ltd. Rules of Procedure for Board of Directors Meetings", "Sample Template for XXX Co., Ltd. Rules Governing the Scope of Powers of Independent Directors", "Sample Template for XXX Co., Ltd. Audit Committee Charter", "Sample Template for XXX Co., Ltd. Remuneration Committee Charter", "Sample Template of XXX Co., Ltd. Charter of Nominating Committee", and "Sample Template for XXX Co., Ltd. Rules Governing the Scope of Powers of Supervisors", are revised in response to amendment of the Company Act, the Securities and Exchange Act, the “Regulations Governing Procedure for Board of Directors Meetings of Public Companies”, the “Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies”, the “Regulations Governing the Exercise of Powers by Audit Committees of Public Companies”, and the “Regulations Governing the Appointment and Exercise of Powers by the Remuneration Committee of a Company Whose Stock is Listed on the Taiwan Stock Exchange or the Taipei Exchange”.

 

2.The template, "Sample Template for XXX Co., Ltd. Rules Governing Financial and Business Matters Between this Corporation and its Affiliated Enterprises", is revised as required by the “Regulations Governing the Acquisition and Disposal of Assets by Public Companies”.

 

3.The template, "Sample Template for Mandatory Disclosure on TWSE/TPEx listed company website", is revised in response to correction of the “Regulations Governing Information to be Published in Annual Reports of Public Companies, the Corporate Governance Best Practice Principles for TWSE/TPEx Listed Companies”, and amendment of the 2020 (7th) Corporate Governance Evaluation indicators.

 

4.The template, Sample Template of "Self-Evaluation or Peer Evaluation of the Board of Directors of XX Co., Ltd." is revised and renamed to Sample Template of "Rules for Performance Evaluation of the Board of Directors" in response to correction of the “Regulations Governing Information to be Published in Annual Reports of Public Companies” and the indicators and score guide for Corporate Governance Evaluation.

 

5.The Guidelines for the Adoption of Codes of Ethical Conduct for TWSE/GTSM Listed Companies are revised in response to the “Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies”.

 

6.The “Sample Template for XXX Co., Ltd. Procedures for Election of Directors and Supervisors” has the rules regarding supervisors removed and is renamed to the “Sample Template for XXX Co., Ltd. Procedures for Election of Directors” in response to the FSC Letter Jin-Guan-Zheng-Fa No. 10703452331 dated December 19, 2018 requiring all TWSE- and TPEx-listed companies to replace all supervisors with an audit committee at the end of the terms of the current directors and supervisors.

 

7.The “Template of Articles of Association of Special Committee on Mergers and Acquisitions for Companies Limited by Shares” has the rules regarding the absence of independent directors removed in response to the fact that all TWSE- and TPEx-listed companies have already appointed independent directors.

 

Furthermore, the updated English simplified annual report template is revised in response to amendment of the “Regulations Governing Information to be Published in Annual Reports of Public Companies”. The updated template is available for download on the TWSE website and on the Corporate Governance Center website.

 

For further inquiries, please contact Ms. Sung at 1103@twse.com.tw.