Business by Integrity, Management by Love
As an honest and law-abiding corporation, Everlight Chemical is committed to business integrity. We uphold the commitments we made and adhere to both domestic and international regulations and business ethics standards. With honesty, transparency and responsibility as our core business principles, our policies are rooted in integrity and designed to facilitate effective functioning of the Board, sound corporate governance and robust internal controls and risk management. We have also included supply chain management in our governance framework to make sure we deliver on our sustainability commitments and maintain business continuity.
Board of Directors
- The Board of Directors consists of 11 directors, including 1 female director and 3 independent directors
- Our board members bring a wide range of expertise: 9 directors have a rich background in business management; 2 in accounting and finance; and 1 in law and legal practice
- Functional committees are established to help enhance the Board’s governance and management capabilities
- The Board conducts annual self-evaluation and also receives regular on-site evaluation by an independent third-party. Adjustments are made based on recommendations from the third-party evaluator.
The Audit Committee, Nomination Committee, Remuneration Committee and Strategy Committee are established under the Board to assist board members in fulfilling their governance duties.
Articles of association for each committee have been approved by the Board.
|Functional Committee||Chairperson||Gender||Number of Committee Members||Responsibilities||Minimum Number of Meetings||Number of Meetings in 2021|
|Audit Committee||Wu, Chung-Fern Independent Director||Female||3||Ensure proper preparation of financial statements; oversee implementation and effectiveness of internal controls; monitor compliance with applicable laws and regulations||Once per quarter||8|
|Remuneration Committee||Chang, Yuan-Jan
|Male||3||Formulate and regularly review the Company’s policy, system, standards and framework for performance reviews and remuneration of directors and managers.||Twice per year||4|
|Nomination Committee||Yang, Way-Wen
|Male||5||Formulate and determine the organizational structure of the Board and committees, evaluate their performance and devise guidelines for corporate governance practices||Twice per year||5|
|Strategy Committee||Yang, Way-Wen Independent Director||Male||6||Review the Company and the Group’s mid- and long-term development strategies; review strategies regarding company vision/positioning/culture and the implementation of related strategies||Twice per year||3|
Approaches and Performance on Key Issues
Policy & Commitment
Everlight Chemical has formulated its Principles of Business Integrity and Operating Procedures and Action Guidelines for Business Integrity, providing clear ethical guidelines for employees to follow and preventing any employee, from top to bottom, from accepting or offering improper benefits.
1.The Company implements a Reporting System for Violations of Business Integrity Policies, which includes a dedicated hotline (+886-2-2326-3502) and email ([email protected]) for complaints. The Audit Office is the designated department that handles incoming complaints, with the Audit Committee’s email [email protected] as an available contact point.
(Once a complaint is received, it will be entered into the record for preliminary review, which will help determine, within three days of receipt, whether further investigation should be launched)
2. Our policy for the Reporting System includes clear provisions on complaint handling procedures and confidentiality measures.
3. We accept anonymous reports and rigorously protect the identity of and information submitted by whistleblowers. We are also committed to protecting whistleblowers from any form of retaliation.
Everlight Chemical has established a dedicated unit for business integrity affairs. The Company has also appointed a Corporate Governance Officer in accordance with regulatory requirements, who is responsible for facilitating implementation of policies for business integrity and ethics. The Officer regularly reports their work and progress to the Board.
The Company has also established robust audit and internal control systems to manage risk of misconduct and conduct regular audits and inspections.
Each year, we hold at least one training session on our Operating Procedures for Prevention of Insider Trading and relevant regulations for all incumbent directors, managers and employees.
Performance on Business Integrity & Ethics in 2021
Promoting Anti-corruption and Business Integrity Practices
Both English and Chinese versions of the Principles of Business Integrity and policy regarding the Reporting System for Violations of Business Integrity Policies are available on the Company website for everyone’s reference.
Promoting Principles of Business Integrity
1,760 employees completed the training in 2021. The training completion rate is 100%.
Training on the Reporting System for Violations of Business Integrity Policies
1,762 employees completed the training in 2021. The training completion rate is 100%. The training was also provided for all 11 directors on the Board at board meetings.
Training on the Operating Procedures for Prevention of Insider Trading
A five-minute informational video was played to incumbent directors (on August 12, 2021) as well as managers and employees (at monthly meetings in October 2021). A total of 1,178 people finished viewing the video, representing a 100% training completion rate.
Internal Audit System and Its Performance
- By the end of each year, an annual audit plan is formulated based on risk assessment results. The plan is then submitted to the Audit Committee and the Board for approval, upon which the plan will be filed with competent authorities.
- Self-evaluations and high-level diagnostic work on internal controls are reviewed, and a Statement on Internal Controls is submitted to the Audit Committee and the Board for approval, upon which the statement will be filed in compliance with regulations.
- The Company has put in place management systems by various standards, including ISO 9001, IATF 16949, GMP, ISO 14001, ISO 22301, ISO 27001, ISO 45001, TIPS. We implement the PDCA (Plan-Do-Check-Action) cycle in our internal audit process.
Policy & Commitment
Everlight abides by the Quality Policy (“Customers Caring with Value Creation”) and relevant strategies. We implement the PDCA management cycle in our quality management process and ensure the effectiveness of our quality management system through internal audits and management reviews.
We implement the Six Sigma (6σ) methodology. By providing comprehensive training on quality management, operating a proprietary 6σ certification system, implementing process management practices and utilizing statistical tools, we seek to deliver the best product quality and meet customers’ needs.
There was no incident of material quality management violations in 2021
Our Quality Management System
Everlight’s quality management system has been certified to the ISO 9001 and IATF 16949 standard. Implementing the PDCA process, we carry out internal audits and management reviews to ensure the effectiveness of our quality management system.
•All company branches and facilities have obtained the ISO 9001 certification.
•All branches and facilities related the automobile supply chain (business units pertaining production of specialty chemicals and electronic chemicals) have obtained the IATF 16949 certification for automotive quality management systems.
✓ : The facility has passed relevant third-party assurance
|International Certification for Quality Management Systems||ISO 9001||IATF 16949|
|Scope of Certification||Color Chemicals
Toner and Printer Supplies
|Everlight Plant I|
|Everlight Plant II|
|Everlight Plant III|
|Everlight Plant IV|
|Electronic Chemical Factory|
|Trend Tone Imaging|
|China||Ethical Shanghai/Everlight Shanghai|
|Everlight Hong Kong|
|Europe and Americas||Everlight U.S.A.|
Policy & Commitment
Everlight Chemical implements a robust risk management policy to ensure industrial safety and environmental protection. We regularly assess changes in the external business environment and promote risk awareness among all employees to ensure sustainable operations.
We have established a business continuity management system (BCMS) in accordance with the ISO 22301 BCMS Standard. The system is audited by an independent third-party on an annual basis to ensure its effectiveness.
The Risk Management Committee meets at least twice per year, and the effectiveness of our risk management processes is regularly evaluated by the Audit Office.
Governance Body: Risk Management Committee
- The committee consists of the General Manager and heads of Production, R&D, EHS, Environment & Resource Management, Human Resources, Finance, Procurement, Information, Internal Audit, etc.
- Committee meetings are held twice per year
- mplementation in 2021
– Meetings were held in April and September– Starting from 2022, the committee will present more frequently at board meetings
Risk Management Process
Risk Categories and Definitions
Based on Everlight’s business portfolio, the Company has analyzed and identified seven key risk categories: market risk, political risk, environmental risk, legal risk, financial risk, operational risk and other
Implementation and Performance in 2021: (GRI 102-30)
- Each department has evaluated the potential risks involved in their operations, reported such risks and implemented plans to address such risks or mitigate their impact.
- Supply chain management: on-time delivery (OTD) rate was 78%; mid/high-risk suppliers accounted for 4% of our suppliers.
- Number of mid/high-level operational risks that had been addressed: 6.
- Information security management: 0 incident of key system or service malfunctions
- HR management: employee turnover rate was 2.2% (2021).
- Third-party audits: the effectiveness of our BCMS has been verified through a third-party audit according to the ISO 22301 Standard
Risk Management Goals for 2022: Enhance Organizational Resilience and Ensure Business Continuity
- Reduce ESG-related risks
- Supply chain management goals: OTD rate ≧85%; proportion of mid/high-risk suppliers ≦3%
- Number of mid/high-level operational risks to be addressed: 6
- Information security management goal: ≦1 incident of key system or service malfunctions
- HR management goal: employee turnover rate ≦1.5%
ESG Risk Assessment
|Category||Focus of Risk Assessment||Risk Management Policy/Strategy and Implementation in 2021|
|Environmental protection and management||
• Based on Everlight’s environmental policy of “Mitigate Environmental Risks,Towards Ecological Sustainability.,” we have taken the following actions:
|Occupational safety and health||• We implement comprehensive occupational safety and health measures, including a policy of “Revere Life and Pursue Zero Accident” and requirements of related management systems
• The Company’s headquarters, subsidiaries and plants have obtained the ISO 45001 Occupational Safety and Health Management System certification in 2021
|Product management||• We implement Protocols for Hazardous Chemical Substance Management and Product Safety Assurance System and Management Process to ensure our products are compliant with registration regulations and GHS labeling requirements in various countries. We also actively implement measures to fulfill our commitment to Zero Discharge of Hazardous Substances and ensure safe transport and use of products
• We operate our quality management system by ISO 9001 and IATF 16949 standards to further improve product quality and customer satisfaction
|Society, economy and compliance||
• Our core philosophy is Business by Integrity and Management by Love. Through our corporate governance system, internal controls and annual training on business integrity and the whistleblowing system, we strengthen the awareness of our employees, ensuring that our employees and operations duly comply with relevant laws and regulations. We also use the “Regulations Cloud” software to effectively keep up with the latest changes and updates in laws and regulations
• Everlight has obtained the ISO 22301 Business Continuity Management System certification
• The Company places great emphasis on information security. We have established an Information Security Management Policy and obtained the ISO 27001 Information Security Management System certification
• In 2018, Everlight obtained the Level A certification by the Taiwan Intellectual Property Management Standards (TIPS). In addition to implementing various intellectual property management policies, complying with government regulations and respecting the intellectual property of others, the Company also ensures that its own key technologies, patents, trademarks, copyrights, and trade secrets are properly protected
|Strengthening board functions||• In 2020, the Company established a Corporate Governance Officer, who is responsible for providing information and assistance to help board directors fulfill their duties and enhance the board’s effectiveness|
|Stakeholder communication||• In line with the materiality principle, Everlight values stakeholder engagement and communication. Our biennial questionnaire surveys and analyzes issues that our stakeholders care about. We publish sustainability reports annually to disclose information on material topics and also provide the latest information on our official website and social media|
Climate Change-Related Risks: Response & Performance
|Risk||Risk Category||Response Strategy||Performance Indicator||2020 Performance||2021 Performance|
|Tightened regulation on greenhouse gas (GHG) emissions||Legal Risk||Electricity conservation; shift to natural gas; steam power purchase; carbon emissions reduction measures||GHG emissions intensity||9.6||8.9|
|Shift in market demand from existing products to low-carbon alternatives||Technological Risk||Accelerate R&D of sustainable products||Number of new sustainable products||53.6||54.7|
|Rising raw material costs||Market Risk||Continue to improve manufacturing processes and production efficiency||Atom efficiency (%)||66.4%||67.1%|
|Improve energy and resource efficiency||Water recovery rate (R2) %||81%||86%|
|Disruption in water/electricity supply; natural disasters (typhoons, floods, droughts)||Environmental Risk||Develop BCM plans to reduce impact from natural disasters||Number of BCM plans for medium and high risks||6||6|
Our Risk Management Procedures are based on ISO 31000:2018 Risk Management—Principles and Guidelines and relevant resources
Policy & Commitment
Everlight Chemical recognizes that information security is crucial to business continuity. To ensure the confidentiality, integrity and availability of data, we have an Information Security Management Policy in place to implement precautionary measures and ensure information security.
Structure of Our ISO 27001 Information Security Committee
We operate an information security management system certified by the ISO 27001 Standard
We have established the Information Security and Personal Information Management Committee. Each quarter, the committee convenes an information security review meeting and a meeting with information security representatives. The Head of the Information Division regularly reports on an annual basis to the Board about the implementation results of information security measures.
No information security incident occurred in 2021. Also, the Company obtained the ISO 27001 Information Security Management System certification.
Everlight Chemical has obtained the ISO 27001 Information Security Management System certification
|External Threat Prevention||Internal Management|
|1. Regularly scan the Company’s network for vulnerabilities and patch them up to prevent hacker attacks.
2. Install firewalls to protect our network from malware attacks.
3. Deploy anti-spam software to catch any virus and spam in emails.
4. Regularly update anti-virus software regularly to prevent infection by computer viruses.
5. Commission an external service provider to inspect the Company’s network on-site. The service provider is required to sign a Confidentiality Agreement with Contracted Service Providers beforehand.
|1. Enhance promotion and training on information security.
2. Deploy encryption systems to encrypt confidential documents and prevent information leaks.
3. Regularly back up mainframe data, work with a remote backup service provider and conduct information breach drills annually.
4. Periodically review and manage privileged/regular accounts.
5. Set up a testing environment for system development to reduce man-made errors.
6. External personnel must apply in advance to access the Company’s intranet resources (Wi-Fi).
7. Collect and monitor system logs to prevent any illegal access to the Company’s system.
8. External hard drives must be registered before being used on company computers.
Policy & Commitment
Everlight Chemical is committed to developing environmentally-friendly chemical products. To provide safe, reliable, high-quality and sustainable products for our customers, we work with our suppliers to fulfill our respective environmental and social responsibility and promote sustainability across the supply chain.
We work with suppliers that meet the following environmental and social responsibilitystandards
Everlight’s Environmental and Social Responsibility Standards for Suppliers:
Green Supply Chain Management
In 2021, 24% of Everlight’s procurement spending was on local suppliers. Impacted by the pandemic, procurement from Europe and the Americas has declined over the past two years. In the future, the Company will continue to increase the ratio of local procurement.
Everlight Chemical Taiwan Headquarters’ Local Procurement Ratios (2019-2021): (GRI204-1)
|Europe and the Americas(%)||13||14||10|
Everlight Chemical Group’s Local Procurement Ratios (2021):
|Type||Entity||Proportion of Spending (%)|
|Local Procurement||Everlight Chemical||24|
|Trend Tone Imaging||0*|
|Non-Local Procurement||Everlight Chemical||76|
|Trend Tone Imaging||100|
*As a toner company, Trend Tone Imaging works with key domestic/overseas upstream suppliers of resin, metal powder and color chemicals to ensure steady supply of materials. In 2021, Trend Tone Imaging sourced 0% of its raw materials locally but 99% of its materials locally.
Supply Chain Risk Management
To ensure stable supply of raw materials, in 2021, the Company adjusted its supplier risk assessment approach to focus on suppliers that offer multiple raw material items. This adjustment is also in line with our goal of enhancing organizational resilience and ensuring stable supply of raw materials. Evaluation in 2021 indicates that 96.7% of our suppliers are low-risk suppliers.
|Risk Level||Number of Suppliers||Percentage (%)|
Green Supply Chain Management Results
In 2021, we surveyed our 15 critical suppliers on the three topics below. Results of the survey are illustrated below.
- (a) Wastewater per ton of finished products
- (b) Compliance with occupational safety and health regulations
- (c) Compliance of hiring practices with local regulations