Committees

The powers of the Committee are as follows:

1. The adoption of or amendments to the internal control system pursuant to Article 14-1 of the Securities and Exchange Act.
2. Assessment of the effectiveness of the internal control system.
3. The adoption or amendment, pursuant to Article 36-1 of the Securities and Exchange Act, of the procedures for handling financial or business activities of a material nature, such as acquisition or disposal of assets, derivatives trading, loaning of funds to others, and endorsements or guarantees for others.
4. Matters in which a director is an interested party.
5. Asset transactions or derivatives trading of a material nature.
6. Loans of funds, endorsements, or provision of guarantees of a material nature.
7. The offering, issuance, or private placement of equity-type securities.
8. The hiring or dismissal of a certified public accountant, or their compensation.
9. The appointment or discharge of a financial, accounting, or internal audit officer.
10. Annual and semi-annual financial reports.
11. Other material matters as may be required by this Corporation or by the competent authority.

    The matters under the preceding paragraph shall be subject to the approval of one half or more of the entire membership of the Committee and shall be submitted to the board of directors for a resolution.
    Any matter in the paragraph 1, with the exception of subparagraph 10, that has not been approved by one half or more of the entire membership of the Committee may be adopted with the approval of two thirds or more of the entire board of directors.
    “The entire membership,” as used herein, shall be counted as the number of members actually in office at the given time.
    The convener of the Committee shall represent the Committee to the public.

  The Committee shall exercise the care of a good administrator to faithfully perform the following duties and present its recommendations to the board of directors for discussion. However, recommendations regarding compensation for supervisors may be submitted to the board of directors for discussion only when the board of directors is expressly authorized to resolve on that matter by the articles of incorporation or by a resolution of the shareholders meeting:

1. Periodically reviewing this Charter and making recommendations for amendments.
2. Establishing and periodically reviewing the performance assessment standards, annual and long-term performance goals, and the policies, systems, standards, and structure for the compensation of the directors, supervisors, and managerial officers of this Corporation, and disclose the contents of the performance assessment standards in the annual report.
3. Periodically assessing the degree to which performance goals for the directors, supervisors, and managerial officers of this Corporation have been achieved, setting the types and amounts of their individual compensation based on the results of the reviews conducted in accordance with the performance assessment standards. The annual report shall disclose the results of the individual performance assessments of the directors, supervisors and managerial officers and the connection between and reasonableness of the contents and amounts of their individual compensation and performance assessment results, and making a report at a shareholders’ meeting.

    The Committee shall perform the duties under the preceding paragraph in accordance with the following principles:

1. Ensuring that the compensation arrangements of this Corporation comply with applicable laws and regulations and are sufficient to recruit outstanding talent.
2. Performance assessments and compensation levels of directors, supervisors, and managerial officers shall take into account the general pay levels in the industry, individual performance assessment results, the time spent by the individual and their responsibilities, the extent of goal achievement, their performance in other positions, and the compensation paid to employees holding equivalent positions in recent years. Also to be evaluated are the reasonableness of the correlation between the individual’s performance and this Corporation’s operational performance and future risk exposure, with respect to the achievement of short-term and long-term business goals and the financial position of this Corporation.
3. There shall be no incentive for the directors or managerial officers to pursue compensation by engaging in activities that exceed the tolerable risk level of this Corporation.
4. For directors and senior managerial officers, the percentage of remuneration to be distributed based on their short-term performance and the time for payment of any variable compensation shall be decided with regard to the characteristics of the industry and the nature of this Corporation’s business.
5. Reasonableness shall be taken into account when the contents and amounts of the compensation of the directors, supervisors, and managerial officers are set. It is not advisable for decisions on the compensation of the directors, supervisors, and managerial officers to run contrary to financial performance to a material extent. It is not advisable for said compensation to be higher than that in the preceding year in the event of a material decline in profits or of long-term losses. If it is still higher than that in the preceding year, the reasonableness shall be explained in the annual report and reported at a shareholders’ meeting.
6. No member of the Committee may participate in discussion and voting when the Committee is deciding on that member’s individual compensation.

    “Compensation” as used in the preceding two paragraphs includes cash compensation, stock options, profit sharing and stock ownership, retirement benefits or severance pay, allowances or stipends of any kind, and other substantive incentive measures. Its scope shall be consistent with the compensation for directors, supervisors, and managerial officers as set out in the Regulations Governing Information to be Published in Annual Reports of Public Companies.
    If the decision-making and handling of any matter relating to the remuneration of directors and managerial officers of a subsidiary is delegated to the subsidiary but requires ratification by the board of directors of this Corporation, the Committee shall be asked to make recommendations before the matter is submitted to the board of directors for deliberation.

The Sustainability Committee is composed of four members appointed by resolution of the Board of Directors. The members possess professional knowledge and expertise in corporate sustainability, and at least one director shall participate in oversight responsibilities.

Under the authorization of the Board of Directors, the Committee shall act with the due care of a prudent manager, faithfully perform the following duties, and report to the Board:

1. Formulate, promote, and strengthen the Company’s sustainability policies, annual plans, and strategies.
2. Review, monitor, and revise the implementation status and effectiveness of sustainability initiatives.
3. Oversee sustainability-related disclosures and review the Company’s sustainability report.
4. Supervise the execution of the Company’s Sustainability Guidelines and other sustainability-related matters as resolved by the Board of Directors.

Dedicated and cross-functional sustainability units support the Committee in implementing various initiatives. These efforts are organized into the following working groups, each responsible for reporting the implementation status of sustainability-related matters to the Committee:

1. Corporate Governance Working Group: Responsible for legal compliance in corporate governance, formulation of fair compensation policies, performance evaluation systems, employee training programs, and stakeholder communication mechanisms to fulfill the Company’s sustainability goals.
2. Environmental Sustainability Working Group: Responsible for environmental management systems, compliance with relevant environmental laws and international standards, assessment of sustainability transition, enhancement of resource efficiency, climate change response mechanisms, and the establishment of dedicated environmental management units or personnel to achieve environmental sustainability objectives.
3. Social Responsibility Working Group: Responsible for human rights policies and procedures, compliance with human rights-related laws and international standards, internal and external communication across all organizational members (e.g., employees, subsidiaries, joint ventures) and key members of the value chain, risk assessments and management mechanisms, and the promotion of community and cultural development to support sustainable operations.
4. Sustainability Disclosure Working Group: Responsible for sustainability information management policies, compliance with disclosure-related laws and international standards, and ensuring the disclosure of relevant and reliable sustainability information to enhance transparency.