Governance| ASIX Electronics

Organization Chart

Board Diversity and Independence

Board Diversity

According to the Articles of Incorporation, ASIX Electronics’ Board of Directors consists of nine members, including no fewer than three independent directors. Directors are elected through a candidate nomination system, with shareholders selecting from the list of nominees. Each director serves a three-year term. The qualifications, shareholding requirements, restrictions on concurrent positions, nomination, and election procedures for independent directors are all conducted in accordance with the Company Act and the Securities and Exchange Act. Board members generally possess the knowledge, skills, and professional competence required to fulfill their duties, and the Board regularly and ad hoc convenes meetings to deliberate on major issues facing the company, while overseeing and managing potential challenges.

ASIX places strong emphasis on board diversity. Membership is not restricted by gender, age, ethnicity, or nationality, and is structured to ensure that directors collectively possess the knowledge, skills, and expertise necessary for effective governance. The composition of the Board takes into account the company’s operational framework and future development trends, with the goal of achieving sound corporate governance. The Board as a whole is expected to demonstrate diverse capabilities, including business judgment, accounting and financial analysis, management expertise, crisis response, industry knowledge, global market perspective, leadership, decision-making, and risk management proficiency.

Currently, the Board comprises nine members, including three independent directors (33%) and two directors who are also employees (22%). Given the higher proportion of male professionals in the technology industry and the need to balance overall board competencies, the proportion of female directors has not yet reached one-third. Nevertheless, ASIX has set a target to increase female representation on the Board to one-third. As of the end of 2025, the age distribution of directors is as follows: three under 60 years old, five between 61 and 70, and one between 71 and 80. At present, there is one female director, and all independent directors meet the requirements set forth by the Financial Supervisory Commission’s Securities and Futures Bureau.

Board Independence

ASIX’s Board of Directors consists of nine members, including three independent directors, representing 33% of the Board. None of the independent directors hold shares in the company, and all comply with the relevant regulations of the FSC Securities and Futures Bureau. Furthermore, none of the directors fall under the circumstances specified in Article 26-3, Paragraphs 3 and 4 of the Securities and Exchange Act, demonstrating that the Board maintains a high level of independence.

Business Performance

ASIX was dedicated to Designing Value-oriented, Technologically Innovative, Highly Integrated, and Cost-effective Chip Solutions. The company focuses on cultivating high-niche blue ocean markets for industrial/embedded/USB Ethernet chips, achieving an outstanding performance of 25 consecutive years of profitability. At the same time, ASIX was actively investing in research and development and creating job opportunities.

Dividend Policy

ASIX's dividend policy, as stipulated by the company's articles of incorporation, was determined based on factors such as the company's capital and financial structure, operating conditions, profits, and the characteristics and cycles of the industry it belongs to, adopting a prudent principle for distribution. The amount distributed shall not be less than 30% of the annual after-tax profits, with cash dividends comprising no less than 10% of the total dividends distributed. If there is any profit after the annual final accounts, it shall first be used to pay taxes and cover previous losses, followed by a 10% allocation to the legal reserve. However, if the legal reserve has reached the company's paid-in capital, this allocation is not required. Additionally, special reserves shall be allocated or reversed in accordance with the company's operational needs and legal requirements. The remaining profit, after dividend distribution and the inclusion of any undistributed profits from the beginning of the year, shall be proposed by the Board of Directors and submitted to the shareholders' meeting for approval.

On February 19, 2025, the Audit Committee reviewed and submitted the 2024 profit distribution plan, which was approved by the Board of Directors and proposed for the shareholders' annual meeting's approval, distributing NT$3 per share in cash dividends.

Ethical Business Conduct Policy and Implementation

Ethical Business Conduct Policy

ASIX adheres to the principle of integrity and has established the “Code of Ethical Conduct” and “Code of Business Ethics,” which are embedded in the decision-making processes of the Board of Directors and senior management. Board members proactively recuse themselves from voting on proposals involving personal interests, demonstrating the company’s commitment to ethical governance.

In accordance with regulations issued by the competent authorities, ASIX implements the “Management Guidelines for the Appointment or Dismissal of Insiders” and the “Insider Trading Prevention Guidelines” to promote awareness and compliance among insiders regarding the prohibition of trading securities based on non-public information. In addition to regular legal briefings and training sessions, the company also coordinates participation in regulatory outreach programs to strengthen legal awareness and foster self-regulation. A robust accounting and internal control system has been established, with periodic audits conducted by the internal audit unit and reported to the Board of Directors.

ASIX evaluates the integrity records of counterparties and, where appropriate, includes integrity clauses in contracts to reinforce ethical standards in business relationships. Ethical conduct is fundamental to the responsibilities of directors and managers, and the company regularly—at least annually—promotes related principles to ensure continued awareness and commitment.

Implementation of Ethical Business Practices

ASIX is committed to upholding ethical business conduct. The following measures have been implemented to ensure integrity across operations:

1. Governance and Training

ASIX adopts a professional management system, with the executive team responsible for day-to-day operations and regular reporting to the Board of Directors, including complete meeting records. At least once annually (e.g., December 18, 2024), the internal audit unit reports to the Board on the implementation of ethical business practices. Quarterly training sessions are held for employees and new hires, covering topics such as codes of ethical conduct, intellectual property management, insider trading prevention, personal data protection, and trade secret safeguards. Internal control audits conducted this year confirmed effective and reasonable oversight, with no significant irregularities or risks identified. Furthermore, no legal proceedings related to anti-competitive behavior have occurred.

2. Customer Privacy and Data Governance

ASIX places high importance on customer privacy. In accordance with the Personal Data Protection Act, the company regularly educates employees on data protection and confidentiality principles. A comprehensive data governance framework has been established, including data classification standards, access control mechanisms, and owner review procedures to ensure data availability, integrity, and confidentiality. This framework applies to all branches, operational sites, subsidiaries, customers, and suppliers. All personal data collection, processing, and usage during operations strictly comply with applicable laws and regulations, and ASIX does not disclose, rent, or share personal data with third parties. Internal audits confirmed the effectiveness of these controls, with no major risks identified.

3. Legal Compliance and Stakeholder Engagement

ASIX complies with relevant laws and regulations, including the Company Act, Securities and Exchange Act, Business Accounting Act, Political Donations Act, Anti-Bribery Act, Government Procurement Act, and the Act on Recusal of Public Servants Due to Conflicts of Interest. Due diligence is conducted prior to engaging with upstream and downstream partners to mitigate risks. A whistleblower hotline is available for stakeholders to report potential conflicts of interest. In 2024, all board members signed the Statement of Ethical Commitment. For more details, please refer to the company website and the relevant sections of the annual report published on the Market Observation Post System.

4. Preventive Measures Against Unethical Conduct

In accordance with internal codes and external guidelines, ASIX regularly reviews and implements preventive measures to mitigate risks associated with bribery, illegal political contributions, improper donations or sponsorships, acceptance of unreasonable gifts or hospitality, infringement of trade secrets and intellectual property rights, and unfair competition. To date, no violations of ethical business conduct have been reported.

5. Grievance Mechanisms

ASIX has established robust internal control mechanisms and provides spokesperson and supervisor contact emails on its official website for stakeholders to submit complaints. As of now, no grievance cases have been received.

Enterprise Operational Risk and Management

Operating a business often requires facing opportunities and risks from both internal and external sources. Companies must have a proactive approach to risk management, identifying and addressing potential economic, environmental, and social crises that may impact operations. Effective risk management enables stable business operations, reduces the impact and loss from significant risk events, ensures sustainable business practices, protects the rights and interests of all stakeholders, and further maintains the company's image.

ASIX manages enterprise risks, including operational management, strategic planning, financial operations, climate change, and other risks, through a five-step process: hazard identification, risk assessment, decision-making, implementation, and supervision and review. This comprehensive approach ensures that the company can mitigate the impact on its operations during emergencies while maintaining personnel safety and protecting shareholders' interests.

Operational Risk Issues and Countermeasures

Operational Risk Management Organization and Responsibilities

Information Security Policies and Management Measures

To ensure the company’s sustained growth and uphold the core value of sustainable operations, ASIX has established a clearly defined information security policy and an information security management organization, specifying related responsibilities and operational procedures. By strengthening all employees’ awareness of information security and implementing effective management of security equipment and environments, ASIX ensures the confidentiality, integrity, and availability of its information assets. These measures effectively reduce information security risks and protect operational stability and corporate reputation.

Information Security Management Measures and Resources

ASIX is committed to implementing robust internal information security management by strictly enforcing detailed security protocols and continuously investing in cybersecurity equipment to enhance information system safety and data protection, thereby achieving effective risk control. An annual information security risk assessment is conducted regularly, followed by information security management meetings chaired by the Chief Information Security Officer (CISO). These meetings comprehensively review risk assessment results and discuss relevant cybersecurity issues. When necessary, ad hoc meetings may be convened to promptly address potential security risks and incidents. In addition, through an internal audit mechanism, ASIX conducts regular annual information security audits. Based on the results of risk assessments and audit findings, concrete improvement measures are proposed and implemented to ensure continuous enhancement and enforcement of the information security management system.

Information Security Incident Handling and Reporting

ASIX has established information security incident handling and notification procedures. Designation of personnel are responsible for handling major information security incidents and taking necessary countermeasures. In 2024 and as of the date of this Annual, ASIX has no major information security incidents, and there is no financial or operational impact caused by major information security incidents.

Specific Information Security Management, Measures and Results

1. To strengthen the security of its information systems, the company conducted vulnerability scanning and penetration testing in 2024 to comprehensively identify potential risks and promptly implement patching and defensive measures, thereby reducing cybersecurity threats.

2. The company has initiated a feasibility assessment and planning for the implementation of the ISO/IEC 27001 Information Security Management System (ISMS). Follow-up implementation and guidance mechanisms are being developed to enhance the institutionalization of information security management and align with international standards.

Governance