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UMC Corporate Governance Policy

UMC has an effective corporate governance framework that is consistent with Taiwan's Company Act, Securities and Exchange Act, and other related laws and regulations. UMC also established the "UMC Corporate Governance Practice Principles", "UMC Ethical Corporate Management Best Practice Principles" and "UMC Corporate Social Responsibility Principles" as practical company considerations to protect shareholders' equity, respect stakeholders, enhance information transparency, strengthen the competency of the Board, and uphold corporate integrity and code of conduct.


Board of Directors

To ensure a fair, just, and open election of directors, the nomination and election procedures of the Company’s directors shall be complied with the Company Act and all related laws and regulations. The organizational culture, business model and long-term development of the Company shall be taken into consideration to the composition of the Board members. The criteria established to ensure the diversity of the Board members shall include but not limited to the following three dimensions:
1. Basic criteria: shared visions, gender, independence and culture etc.
2. Professionalism: educational background, professional skills and industry experience etc.
3. Corporate sustainability and communal participation: corporate governance, environmental sustainability, corporate social responsibility, legal compliance and human rights protection etc.

Each board member shall possess the indispensable knowledge, skill, and experience to perform their duties; the capabilities with which the Board as a whole shall equip include the followings: business acumen, knowledge of accounting and financial analysis, business management, crisis management, industry knowledge, global perspective, leadership and decision-making.

At least one among the independent directors of the Company shall be an accounting or finance professional.

Each director must be held by a person having neither a spousal relationship nor a relationship within the second degree of kinship with any other directors.

The performance assessment of the Board shall be reviewed annually according to the assessment guideline and procedure of the Company; the results will be referenced for nomination and election of the directors.

Nomination and Election

The Company shall have nine (9) to eleven (11) directors who serve a term of three years, elected at the shareholders’ meeting from persons of legal capacity through a nominating system adopted from 2006. A director may be re-elected.

At least three (3) directors or one-fifth of all directors, whichever is higher, shall be independent directors. Their qualifications, shareholding limitations, whether or not they concurrently serve in other positions, methods of nomination and election, and other related matters shall be subject to applicable laws.

According to Article 192-1 of the R.O.C. Company Act, UMC announced on March 23, 2015, the period for accepting the nomination of director candidates (including independent directors), the number of directors to be elected, the place designated for accepting the roster of director nominees and other necessary matters. Any shareholder holding 1% or more of the outstanding shares of the Company may nominate candidate(s) for directors in writing. Any shareholder qualified to nominate may submit nominee(s) to the director, and shall send, during the nomination period from April 2 to April 13, 2015, the name, educational background and past work experience of the nominee(s), a letter signed by each nominee consenting to act as director if elected, a written statement issued by each nominee assuring that he/she is not prohibited from acting under any of the circumstances set forth in Article 30 of the R.O.C. Company Act, and other relevant documents signed and provided by each nominee to UMC via registered mail sent to the Finance Division of the Company. There were no nominations from stockholders except those from the Board during the nomination period.

> Director Candidate List

> Directors' Professional Knowledge and Independence Information

> List of Directors Elected

To implement corporate governance, enhance capabilities and review the performance of the Board, UMC distributes self-assessment forms to its Board of Directors and functional committees to conduct annual self-evaluation of the Board's performance in order to enhance the Board's role and responsibilities, including in areas such as the degree of participation in the Company's operations, understanding of the business and its risks, the improvement of policy decision quality, the composition and structure of the board of directors, the election and continuing professional development of directors, internal control and Audit Committee communications, oversight of the financial reporting process and so on.

The conclusion of self-assessment of the Board of Directors and functional committee in 2017 is that the Board and the functional committee is functioning efficiently and as intended.

The Company's board performance assessment will be conducted by an external independent professional institution or a panel of external experts and scholars at least once every three years.


Audit Committee

The Audit Committee assists the Board of Directors in performing its supervision functions. It is also responsible for tasks defined by the Company Act, Securities and Exchange Act and other relevant regulations. Since UMC is listed on the NYSE, it also has to comply with the U.S. regulations regarding foreign issuers. The Audit Committee is comprised of all independent directors. Cheng-Li Huang and Wenyi Chu qualify as audit committee financial experts. The Committee shall meet at least once every quarter, and may be convened any time if necessary.

The Committee's duty and responsibility includes the following items: supervising the financial reporting of the Company, internal audit, internal control of the Company, material transactions of assets and derivatives, loans, endorsements, guarantees, engaging and removing the Company's independent auditors and accessing such auditors' compensation and independence, and appointing or removing managers of finance, accounting and internal audit divisions. The Committee is also responsible for dealing with any whistleblower cases received and periodically reviewing the Company's compliance with government law, documentation that involves government agencies, and the compliance of the employees' Code of Conduct. The Committee may also engage an attorney, certified public accountant, or other professional to assist them in exercising the Committee's duties. For further information regarding UMC's audit committee charter, please click on the link below.


Remuneration Committee

The goal of Remuneration Committee's operation is to strengthen corporate governance and risk control, and to evaluate and monitor the Company's remuneration system for its directors and managers while considering the provision of incentives to facilitate talent retention. The committee shall be composed of all the Company's independent directors, and convene meetings accordance with the laws.


Capital Budget Committee

The Capital Budget Committee shall comprise of members from the Company's independent directors and non-executive directors. The Committee's goal includes review of the Company's capital expenditure budget, with the intent to strengthen long-term corporate strategy, financial planning and business performance.

> Link to Capital Budget Committee Charter

Nominating Committee

The Nominating Committee shall comprise of members from the Company's independent directors. The Committee's goal is to assist the Board of Directors (“the Board”) to enhance management mechanism and to improve corporate governance for the Company’s sustainable development. The objectives of the Committee are as follows: 1. To constitute nomination policy and succession plans of the directors and the executives, then to search, to review and to propose the candidate list of the directors and the executives accordingly. 2. To construct and to develop the operation of the Board and the sub-committees, as well as to plan and to execute the performance assessment of the Board, the sub-committees and the executive(s). 3. To enhance corporate governance system and practices in order to protect the interests of stakeholders.

> Link to Nominating Committee Charter


Gov
Full Version

> Download UMC Corporate Governance Statement (pdf, 32kb)


Individual Sections

> The Board of Directors' Responsibilities and Meetings
> Audit Committee's Responsibilities
> Structure of the Board of Directors


> Download Articles of Incorporation of UMC (pdf, 41kb)
> Download the Organization and Operation of UMC's Internal Audit (pdf, 27kb)
> Download the UMC Loan Procedure (pdf, 95kb)
> Download the UMC Endorsements and Guarantees Procedure (pdf, 101kb)
> Download the UMC Financial Derivatives Transaction Procedure (pdf, 131kb)
> Download the UMC Acquisition or Disposal of Assets Procedure (pdf, 242kb)
> Download the UMC Ethical Corporate Management Best_Practice Principles(pdf, 143kb)
> Download the UMC Code of Ethics for Directors and Officers(pdf, 38kb)
> Download the UMC Employee Code of Conduct (pdf, 119kb)
> Download the UMC Corporate Social Responsibility Principles (pdf, 225kb)
> Download the UMC Corporate Governance Practice Principles (pdf, 121kb)
> The differences between the UMC's corporate governance practices and those required of domestic companies under NYSE listing standards
> Download Taxation Policy and Governance (pdf, 96kb)

> Code of Conduct violations can be reported by e-mail or phone:
Email: whistleblower@umc.com
Phone: 0800-024-399 (toll free) or 03-5782258 ext.31425

Please note that all information is governed by the following Terms & Conditions.

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