n   Ethical Management

The Company has its “Ethical Management Best Practice Principles” in place to implement business activities of ethical management based on the principles of honesty, fairness, credibility, and transparency. The Company declares its ethical management policy in its internal rules and regulations, annual reports, corporate website, paper-based literature, and external activities, allowing its managers, employees, suppliers, customers, or other business-related institutions and persons to understand the ethical management philosophy and standards of the Company.

During each annual new employee orientation, the Company arranges explanations of the relevant rules and regulations regarding rewards and penalties. We also emphasize the importance of integrity among employees by promoting topics related to “part-time work” and “accepting improper benefits”. In 2022, a total of 44 newly hired employees received training on these matters. Additionally, to enhance the professional competence and legal literacy of the company’s directors and supervisors, we organized 2 corporate governance courses. These courses covered topics such as information disclosure and insider trading. The total training hours for new directors and supervisors were 12 hours for newcomers and 6 hours for those who were re-elected.

n   Recusal for Conflict of Interest

The Company has its “Code of Ethical Conduct for Directors” in place for strict compliance with principles of recusal for conflict of interest and anti-corruption, and has the Rules of Procedure for Board Meeting established in accordance with the “Regulations Governing Procedure for Board of Directors Meetings of Public Companies”; when any proposal at the Board meeting involves matters for self-recusal of directors stated in the abovementioned rules and regulations, or when the interests of directors may harm the interests of the Company, directors shall recuse themselves from the discussion and voting, and they shall not exercise the voting rights on behalf of other directors.

In addition, relevant codes for the recusal for the conflict of interest are stated in the organizational rules, and punishment provisions are established to specify that employees of the Company shall process their businesses by adopting objective and efficient methods and avoid using their positions in the Company to allow relevant persons or enterprises to acquire unjust benefit. Employees are strictly forbidden to seek personal interests by using the identities or information gained from their duties or positions.

n   Prevent Malpractice

CT has long been prohibited unethical behaviors of “requesting, offering, or accepting unjust benefits, or accepting entertainment provided by suppliers or stakeholders”, which constitutes a part of CT’s corporate culture. In addition, according to subparagraph 1, paragraph 1, Article 7 of the Political Donation Act, the Company shall not make any political donation. In accordance with the “Ethical Corporate Management Best Practice Principles”, in the course of engaging in business acts, directors, managers, appointees, and substantial controllers of the Company shall not directly or indirectly provide, promise, request, or accept any unjust benefit, or perform other unethical behaviors that violate ethics, are illegal or violate the trusted obligations to seek or maintain their interests.

Direct or indirect donations to political parties or organizations or individuals participating in political activities shall also comply with the Political Donation Act and relevant internal operating procedures of the Company, and shall not seek business interests or transaction advantages thereof. In addition to passing down the favorable tradition through the inheritance of our corporate culture, the Company also performs stringent prevention measures through relevant organizational rules and regulations, control systems, and employee training. Internal parties of the Company are responsible for the report of malpractices; the report of illegal matters shall be subject to the justifiable channels with descriptions of substantial evidence. The Company has established a smooth complaint channel through the whistleblowing line, e-mail, and the report system on the corporate website and has authorized the Audit Office to handle the complaint cases; the entire process for handling complaint cases is confidential. In 2022, there is a total of 0 complaint case received and handled. Complaint cases are thoroughly investigated and verified before being appropriately handled by the relevant authorities. The findings of the investigation will determine if there are any major instances of corruption, bribery, or violations of operational regulations.

n   Complaint Channel

Complaint line: (03)473-0201 #215 (CT’s Audit Office), complaint facsimile: (03) 473-0201 #215, and the company’s complaint mailbox: jack.lee@century.com.tw, are provided for the whistleblowing of malpractice, bribery, and fraud. The Audit Office is responsible for handling the complaint of malpractices, harm to the company’s interests, violation of the company’s rules and regulations, and other inappropriate matters and extensively collecting information on the inappropriate conduct. All complaints are duly investigated and appropriately handled, aligning with relevant units to manifest the corporate culture of integrity; there is no case of significant malpractice or harm to the company’s interest.

n   Risk Evaluation

The Audit Office carries out risk evaluations that include compliance with relevant laws and regulations for the business cycles and operating items according to the requirements under the “Regulations Governing Establishment of Internal Control Systems by Public Companies” promulgated by the FSC each year and formulates the annual audit plan based on the risk evaluation results.

n   Self-monitoring

At the end of each year, the departments shall perform the self-internal control system evaluation for the internal control; after being reviewed by the Audit Office, the self-monitoring reports of departments shall be submitted to the President for Approval to respond to environment changes in due course and adjust the design of the internal control system and its execution, realizing the self-monitoring system of the Company.

n   Countermeasures for Inappropriate Conduct

The company’s inappropriate conduct cases are subject to the work management rules.

n   Lobbying and Entertainment Regulations

Ø   Anti-corruption manual: For the execution, except for circumstances otherwise stated, financial gifts from stakeholders shall be rejected or returned. When the gifts cannot be returned, deliver them to the General Affairs Section for handling after being signed by and reported to the supervisor for archiving.

Ø   The Audit Office regularly compiles the lobbying cases (including the disposals) and submits them to the Chairman for review. In 2022, there is a total of 0 lobbying case compiled for subsidiaries. Lobbying cases shall be combined with the Audit Report and the improvement and follow-up report of anomalies according to the requirements. The Audit Office shall also report the execution status of lobbying cases when presenting at Board meetings.

n   Information Transparency

CT is a listed company that complies with relevant regulations and has established a favorable internal material information processing and disclosing system of the Company to avoid the inappropriate leakage of information and ensure the consistency and accuracy of the information released by the Company to external parties; therefore, the “Procedures for Material Internal Information Processing of Century Iron and Steel Industrial Co., Ltd.” was established for observation.

CT adheres to the following principles when disclosing material internal information to external parties: the disclosure of the information shall be accurate, complete, and timely; the information disclosure shall have a basis; the information shall be justly disclosed. Also, information disclosed to external parties shall have the following records kept: personnel, date, and time of the information disclosure; method of the information disclosure; content of the information disclosed; content of the written data delivered; other relevant information. If the content reported by the media is inconsistent with the content disclosed by the Company, the Company will immediately make clarifications on the MOPS and require the media to make corrections.