The Board of Directors appointed Ms. Sylvia Fang, the Vice President and General Counsel of TSMC, as the Corporate Governance Officer responsible for corporate governance matters, including handling of matters relating to Board, Audit Committee, Compensation Committee and Shareholders' meetings in compliance with law, assistance in onboarding and continuing education of directors, provision of information required for performance of duties by directors, and assistance in directors' compliance of law, etc.

The duties performed by the Corporate Governance Office in 2020 are as follows: assisted Chairman of Board of Directors and Committees’ Chairs to convene four Board Meetings, five Audit Committee Meetings, four Compensation Committee Meetings and 2020 Annual Shareholders’ Meeting; assisted onboarding for new elected Independent Director, Mr. Yancey Hai; provided continuing education information to directors; provided information required for performance of duties by directors; presented quarterly legal compliance report to the Board of Directors, and timely responded to all Directors’ requests, and etc.

 

Continuing Education Training of Corporate Governance Officer in 2020

Name Date Host by Training/Speech Title Duration
Vice President and General Counsel / Corporate Governance Officer
Sylvia Fang
2020/02/14 Deloitte Touche Tohmatsu Limited
Center for Law, Technology and Ethics, College National Taiwan University of Law
Department of Intellectual Property and Technology Transfer, Academia Sinica
Institute for Information Industry
Technology Transfer and Law Center, Industrial Technology Research Institute
Chinese National Federation of Industries
2020 Legal Tech and Innovation Services Forum 7 hours
2020/10/20 Lee and Li, Attorneys-at-Law Discussion on Commercial Case Adjudication Act and Countermeasures (Hsinchu Session) 3 hours
2020/11/27 Taiwan Trade Secret Protection Association 2020 Cross-Strait Trade Secret Protection Virtual Symposium 8 hours

 

Corporate Conduct and Ethics Implementation

TSMC’s Board of Directors strives to perform the responsibilities of supervising the corporate conduct and ethics compliance practice through the Audit Committee and the Compensation Committee, the hiring of a financial expert consultant for the Audit Committee, and coordination with the Internal Audit department. The General Counsel and the Corporate & Compliance Legal Division (which directly reports to the General Counsel) promotes, with other divisions, the Company’s ethical standards, and the General Counsel reports quarterly to the Board on the implementation status. In addition, both the responsible senior manager appointed by the CEO to oversee the Ombudsmen system and Internal Auditors update the Board on ethical standards and compliance issues on a regular basis. Moreover, TSMC’s officers, especially our CEO, CFO, and General Counsel, with oversight from our Board, are responsible for the full, fair, accurate, timely, and understandable financial accounting and financial disclosure in reports and documents filed by the Company with securities authorities and in all TSMC public communications and disclosures.

Furthermore, to ensure that our conduct meets relevant legal requirements and the highest ethical standards under the Ethics Code, TSMC provides multiple channels for reporting business conduct concerns.

 

The Implementation in 2020

In 2020, under the framework of the Ethics Code, TSMC has established a regulatory compliance program that includes policies, guidelines and procedures in other policy areas, including: Anti-corruption, Anti-harassment, Anti-discrimination, Anti-trust (unfair competition), Environment, Export Control, Financial Reporting, Insider Trading, Intellectual Property, Proprietary Information Protection (“PIP“), Personal Data Protection, Record Retention and Disposal, as well as procuring certain raw materials from socially responsible sources (“Conflict-free Minerals“). The above-mentioned policies are crucial in facilitating overall compliance with the Ethics Code. TSMC provided an “Annual Ethics and Compliance Training Course”(mandatory 0.5 hour online course) covering various important regulatory compliance topics – a total of about 50,482 (99.7% completion rate) employees completed this training course.

In 2020, we didn’t receive any report related to finance or accounting matters, or any material regulatory violation (where a fine exceeds NT$1 million). The incidents reported through the Audit Committee Whistleblower System, Ombudsman System, and Irregular Business Conduct Reporting System totaled 246. Among them, 155 cases were related to employee relations, 69 cases were categorized as others (e.g. asking personal questions or private matters), and 22 cases were related to ethics. 6 incidents were verified upon investigation and determined for disciplinary action by the Ethics Committee.