2012 Corporate Social Responsibility Report - UMC

2.3 Corporate Governance
UMC is committed to strengthening its corporate
governance, improving its corporate governance structure
and safeguarding shareholders’ rights. Since corporate
governance standards have become key factors for
investors to consider when making investment decisions,
UMC expects to realize sustainable management and
improve business performance through a comprehensive
management system. To that end, UMC has established
the Corporate Governance Committee under the
Corporate Social Responsibility Committee to manage
and govern aspects including corporate governance and
regulatory compliance.
UMC’s corporate governance structure and practices
are based on Taiwan’s Company Act, Securities and
Exchange Act, SOX 404 (Section 404 of the Sarbanes-
Oxley Act of 2002), NYSE listing standards and other
related rules and regulations.
The UMC Corporate Governance Statement, Articles
of Incorporation of UMC, Audit Committee Charter,
Compensation Committee Charter, Organization and
Operation of Internal Audit, Code of Ethics for Directors
and Officers, Employee Code of Conduct, relatedparty
transaction procedures and internal significant
information processing procedures can be found on the
company website (http://www.umc.com/english/investors/
Corp_gov.asp).
The operations of UMC’s Board of Directors, Audit
Committee and the Compensation Committee are
in accordance with the regulations of “Rules and
Procedures of Board of Directors Meeting”, “Audit
Committee Charter” and “Compensation Committee
Charter”.
2.3.1 Board of Directors
UMC’s Board of Directors consists of 9 directors
possessing professional backgrounds and experience
in business, laws, finance, accounting or other fields
of expertise. They are accountable for the company’s
operation and supervision. The newly elected board in
2012 included 4 independent directors and 1 individual
director, the non-executive directors account for more
than 50% of the Board. A list of the board members is as
follows:
Title Name Gender Current Position in UMC
Chairman Stan Hung Male Chief Strategy Officer
Director Shih-Wei Sun Male Vice President
Director Po-Wen Yen Male Chief Executive Officer
Director Wen-Yang Chen Male Chief Operating Officer
Director Ting-Yu Lin Male N/A
Independent
Director
Chun-Yen Chang Male N/A
Independent
Director
Chung-Laung Liu Male N/A
Independent
Director
Paul S.C. Hsu Male N/A
Independent
Director
Cheng-Li Huang Male N/A
2.3.2 Audit Committee
The Audit Committee assists the Board of Directors in
performing its supervision functions. It is also responsible
for tasks defined by the Company Act, Securities and
Exchange Act and other relevant regulations. Since UMC
is listed on the NYSE, it also has to comply with the U.S.
regulations regarding foreign issuers. The UMC Audit
Committee consists of 4 independent directors, two of
whom are financial experts. The Committee operates
in accordance with the UMC Audit Committee Charter.
(http://www.umc.com/chinese/pdf/Audit_Committee_Charter_chi.pdf)
Meetings are convened when necessary according to the
members’ authority and responsibility. In 2012, a total of
6 meetings were convened, in which all 4 independent
directors participated.
The main functions of the Audit Committee:
n Review financial report.
n Maintain the validity of the internal control system.
n Evaluate the performance of the departments in
charge of internal control.
n Provide endorsement or guarantee for major assets,
derivatives or loans.
n Appointment, dismissal, remuneration of certified
accountants and evaluation of their independence.
n Appointment of finance, accounting or internal control
supervisors.
n Deal with reported cases or other issues pertaining to
accounting, internal control or auditing.
n Review the company’s regulatory compliance,
correspondences with the competent authorities and
employee ethics on a regular basis.
n Employ lawyers, accountants and other professionals
and assist them in exercising their duties.
UMC 2012 Corporate Social Responsibility Report
P.21