The Taiwan Stock Exchange Corporation (the TWSE) in collaboration with the Taipei Exchange (the TPEx) held the “Award Ceremony of the 9th Corporate Governance Evaluation” on the 9th floor of Taipei 101 at 3pm today (June 9), and praised the top 5% of 46 TWSE-listed companies and 37 TPEx-listed companies in the”2022 Corporate Governance Evaluation,” as well as 14 TWSE-listed and TPEx-listed companies (eight TWSE-listed companies and six TPEx-listed companies), which rank in the top 5% in terms of SME capitalization. At the ceremony, Chairman Tien-Mu Huang of the Financial Supervisory Commission (the FSC), was invited to present the awards, and the heads of related competent authorities and securities peripheral units were also participated.

TWSE Chairman Sherman Lin expressed in his speech that corporate governance is a very important infrastructure for the capital market, and TWSE-listed and TPEx-listed companies are the backbone of Taiwanese enterprises. Relevant units such as the FSC, the TWSE and TPEx have spared no effort in actively promoting TWSE and TPEx-listed companies to enhance corporate governance. Since the release of the first version of the “Corporate Governance Roadmap” by the FSC in 2013, many important measures have been implemented, including the comprehensive establishment of independent directors, audit committees, electronic voting, and the phased preparation of sustainability reports, considering the size and scale of TWSE and TPEx-listed companies. During this process, the Corporate Governance Evaluation plays a crucial role and through the guidance of evaluation indicators, companies have spontaneously strengthened their corporate governance constitution from the inside. Through the evaluation of the four major aspects of “protecting shareholder rights and interests and treating shareholders equitably,” “enhancing board composition and operation,” “increasing information transparency” and “promoting sustainable development,” companies have actively improved and shaped their corporate governance culture in a friendly competition.

Judging from the current international trends, sustainable development has gradually become a global core value. As a capital market platform, the TWSE has actively promoted the construction of an ESG ecosystem in the capital market since last year. It is also committed to integrating stakeholders such as securities peripheral units, listed companies, investors, intermediaries, NGOs and regulation formulators to build an ESG ecosystem with the content including an ESG information platform, planning a digital production platform for sustainable reports, assisting enterprises in carbon inventory, promoting ESG evaluations and developing diversified ESG products, which are highly integrated with the “Sustainable Development Action Plans for TWSE- and TPEx-Listed Companies” released by the regulatory authority this year. The TWSE will also fully cooperate with the regulatory authorities to promote action plans and deepen various measures in the ecosystem, and the Corporate Governance Evaluation will continue to play a crucial role by incorporating the regulatory authorities’ goal of sustainable development promotion into the evaluation indicators, and driving the sustainable development of enterprises through continuous encouragement and guidance.

 During his speech, Chairman Tien-Mu Huang stated that it has been 10 years since the FSC released the first edition of the “Corporate Governance Roadmap” in 2013, and conducting the Corporate Governance Evaluation has been one of the important measures. Since the implementation, it has received attention from TWSE-listed and TPEx-listed companies, and the progress of various evaluation indicators also shows that the implementation of corporate governance has achieved certain results. 

The Corporate Governance Evaluation guides enterprises to adopt and implement various good corporate governance measures, and will be incorporated in the laws and regulations after most companies can achieve the goals and become a common standard for the entire market to follow. Through the long-term implementation and promotion of the evaluation system, the overall corporate governance level of TWSE-listed and TPEx-listed companies has significantly improved. At the same time, through the evaluation of the overall TWSE- and TPEx-listed companies, investors can assess the corporate governance performance of the companies and use it as a reference for investment decisions. At present, the “Taiwan Corporate Governance 100 Index” and “TPEx Corporate Governance Index,” compiled by the TWSE and the TPEx, select their constituent companies from the top 20% TWSE- and TPEx-listed companies in the Corporate Governance Evaluation. After being issued and up to the end of April 2023, these indices showed better growth than the weighted index during the same period, indicating that companies with excellent corporate governance are more favored by investors, which has a substantive incentive effect on TWSE- and TPEx-listed companies with good Corporate Governance Evaluation results. 

Given the severe global climate change and the increasing demand of international supply chains for carbon reduction, it is imperative for enterprises to upgrade and transform in response to their sustainable development. In order to actively respond to the global sustainable development action and the national net zero emission target, the FSC released the “Sustainable Development Action Plans for TWSE- and TPEx-Listed Companies” on March 28 this year, focusing on the four main aspects of “governance,” “transparency,” “digital” and “innovation,” to continuously promote enterprises and actively practice sustainable development. There are also many promotional measures in conjunction with the Corporate Governance Evaluation, and whether or not various strategies and promotion measures can be implemented and integrated into the corporate culture needs to rely on good corporate governance as the foundation. This is also the original intention of promoting the Corporate Governance Evaluation system, which has the goal to have a healthy competition mechanism, urge TWSE- and TPEx-listed companies to internalize corporate governance and sustainable development into the fundamental factors of business management. 

Through the holding of this award ceremony, the TWSE objective is to affirm the efforts of companies with outstanding performance in corporate governance improvement, expecting to make them benchmarks to continue working together for the capital market.