TECO Sustainable Development
 
Corporate governance
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In line with the corporate vision of “TECO GO ECO, energy-conserving TECO and green technology,” the company strives, alongside the quest for revenue and profit growth, to fulfill social responsibilities as a corporate citizen, so as to attain sustainable development. Meanwhile, the company rallies its staff via the five core values of “Ambition, customer focus, teamwork, integrity, and innovation” (ACTION) in creating maximum benefits for our employees, shareholders, and the entire society. TECO passed the certification of Taiwan Corporate Governance Association in 2010, which high commended the company for: 

(1)
Chairman and president are professional managers, actively pushing corporate governance. 
(2)
With sufficient cash in hand, the company boasts good financial structure and boasts clear system and designated units for the supervision and management of affiliates. 
(3)
Independent directors and supervisors are professionals, actively supervising corporate operation and finance and closely interacting with the management and certified public accounts.

 

Board of Directors
TECO's Board of Directors is its supreme institution of governance, responsible for selecting and nominating ranking managerial staffers and formulating the company's strategy for social responsibility, corporate citizen, and sustainable development. In compliance with the “practical guidelines for corporate governance,” the company considers gender equality in selecting directors and takes into account their capabilities in business judgment, accounting and financial analysis, management, crisis handling, industrial knowledge, viewpoint on international market, leadership, and decision making, among others. As of the end of 2013, the company's Board of Directors consisted of 15 members (including three independent directors), including one female and one Japanese, with one third of the directors aged less than 60. They serve a three-year term and can be reelected. All of them are elites in the industrial sector and academics, boasting abundant experience in corporate governance and industrial technologies, as well as expertise in monetary affairs, finance, accounting, and law. The chairman also serves the director of the company's general research institute, leading the company to continuously achieve breakthrough in core technological competitiveness. 
Operation of the Board of Directors
In accordance with the stipulation of its corporate charter, TECO's Board of Directors convenes at least once a quarter, supervising and understanding the execution of business plan, the expression of financial report, auditing reports, and tracking related affairs. In 2013, the Board of Directors convened seven meetings, with the average rate of attendance reaching 90%. The Board of Directors invites at least twice certified public accounts to attend its meetings to discuss auditing operation related to annual report and semiannual report, so as to keep posted on the company's finance. Major resolutions of the Board of Directors are posted on the Market Observation Post System of Taiwan Stock Exchange and the investor-relationship section of the company's website, in addition to publicizing major company regulations, including corporate charter, practical guidelines for corporate governance, and norms on internal auditing, as reference to the public. 
Auditing Committee
Operation of Auditing Committee
TECO set up the “Auditing Committee” in 2012, as a substitute for supervisors. The committee consists of the three independent directors, who elect among themselves one to serve as convener and chairman of the committee's meetings. The committee is in charge of assuring proper expression of the financial statement, appointment and dismissal of certified public accountants, on the basis of their independence and performance, execution of corporate internal control, legal compliance, and management of existing or potential risks. In accordance with organizational charter for the Auditing Committee,” the committees auditing key corporate affairs, including financial statement, the company's policy and procedure for auditing and accounting, system for corporate internal control, transaction and raising of major assets or derivatives, issuance of securities, appointment or dismissal of certified public accountants, and appointment and dismissal of financial, accounting, or internal-auditing chiefs. Required to meet at least once a quarter, the committee convened nine meetings in 2013, the attendance rate in person of the three independent directors reaching 100%. 
 
Communications conducted by independent directors
TECO's independent directors can directly contact the internal auditing chief and certified public accountant, thereby conducting regular auditing of the company's finance and business before communicating directly with management and governance units. After completing auditing for semiannual or annual financial statement, certified public accountant would report the result at the auditing committee and conduct communications for other affairs, as legally required. In addition to the submission of monthly auditing report to independent directors, the auditing chief has to deliver report on specific issues upon the requirement of independent directors. Internal auditing report is also available at the quarterly meeting of the auditing committee. 
Compensation Committee
In order to set up a sound compensation system for directors and managerial staffers, the company set up the “Compensation Committee” in Aug. 2011, whose members are appointed by the Board of Directors. The committee must have three members at least, including one independent director at the minimum, and all the members elect one independent director sitting on the committee as the convener and chairperson of its meetings, which is now served by Chen Tien-chih. The committee is in charge of formulating and reviewing regularly policy, system, standard, and composition for performance evaluation and compensation amount for directors and managerial staffers. In 2013, the committee convened twice, with the rate for attendance in person reaching 100%.
Compensation policy for directors
In addition to reference to the pay levels of peers, TECO offers compensations to directors according to individual performance, company's business performance, and future risks. Total compensation for directors is set at 1-5% of the remainder of finalized earnings after deducting taxation, making up for loss, and 10% provision for legal retained earnings. Actual payout is made according to “measures for allocation of compensations for directors.”
Compensation policy for managerial staffers
Compensation for managerial staffers consists of fixed and variable compensation, with the former being directly linked to the result of KPI (key performance indicator). According to the focus of the company's annual development plan, each department would formulate its KPI every year, covering its performance goal, as well as development of energy-conserving products, environment-related indicator such as improvement of production line, and talent cultivation, including global power development, cultivation of key talents, and passing of experience. 
KPI is reviewed quarterly, for full reflection of individual and team performance. The result is submitted to the review by the Compensation Committee and approved by the Board of Directors, with related information also being disclosed in the annual report (p. 25, annual report, http://www.teco.com.tw/stocker2.asp), so that all stakeholders can fully understand linkage between compensations for directors and managerial staffers and company's business performance. The company regularly reviews the rationality of compensations and general pay levels on the market, to assure competitiveness of the compensation level, thereby achieving the goal of talent recruitment, motivation, and retention. 

 

 
CSR commitment
On TECO's Sustainability Report
Teco Sustainability Commitment
Stakeholder issue and interests
Performance for Key Issuesof Concern to Stakeholders
Greenness & Energy Conservation
Development of green products
Green energy-conservation solutions
Development of new green energy businesses
Green supply chain
Sustainable Development
Operation performance
Sustainability concept and corporate core value
Corporate governance
Risk Management
Legal compliance
Earth Friendliness
Impact of the electric machinery industry on the environment
Environment-related achievements and performance
Green product life cycle
Customer Satisfaction
Products and norms
Premium quality management
Customer services
Customer satisfaction
Human Resource
Human-resources policy
Human-resources management
Communications channel
Career development
Compensations and benefits
Work-Life balance
Occupational health and safety
Social Contribution
Innovation Teco, technology and humanism jointly developed
Scientific education
Creativity education
Sustainable education for aboriginal tribes
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