Compliance, Ethics and Anti-Corruption |
LITEON pledges to uphold honesty and integrity in business management, and to obey the laws and ethical standards of the countries in which it carries out its business activities. LITEON also commits itself to complete compliance with one of its key policies. LITEON has mplemented a well-designed management system and has deployed regulation identification with training programs to strengthen compliance on an ongoing basis.
The Legal Department at LITEON has built an extensive compliance system and devised compliance policies. The department regularly monitors changes in domestic and foreign regulations that may have a potential impact on the company's business operations. In the presence of such changes, the appropriate local legal department will proceed to perform regulation identification to ensure all business activities around the world comply with the local and international laws and regulations. Meanwhile, LITEON's management structure provides a robust risk management framework and an effective implementation roadmap for identifying and managing the risks that require the attention of business managers. Besides, LITEON's internal control mechanisms prevent potential fraud and inappropriate behaviors to minimize risks. Internal interdepartmental reviews and external inspections are in place to ensure the compliance of implementation and performance. There were no substantial cases of conflicts of interest, money laundering, or insider trading in 2022. For large investment projects, the company created task forces to apply certain processes to manage and prevent the risk of fraud and prevent illegal activities. A major key event in terms of compliance is defined as it is in the Procedures for Verification and Disclosure of Material Information of Companies with Listed Securities. A single event on which a total amount of no less than NTD 1 million has been imposed in penalties is defined as a major event. Major events, if any, are disclosed in the appropriate chapters the LITEON Sustainabiity Report.
LITEON requires that its employees, managers, executives, and directors not engage in or use any reason to instruct another to engage in any illegal or unethical behavior. The rules of integrity must be established explicitly and strictly adhered to the employee Code of Conduct in areas including professional ethics, laws and regulations, employee relations, gifts and hospitality, client privacy, intellectual property rights, discrimination, bribery, conflict of interest, protection of corporate assets and reputation and other rules to be observed by employees. Compliance is implemented throughout every operational level of the business activities, such as product design, procurement procedures, and discipline is strictly enforced. We explicitly state prohibition of offering or taking of bribes; offering of illegal political donations, inappropriate sponsorship or charity donations, and improper gifts, treatments, or other unjustified benefits; infringement of intellectual property rights; and unfair competition as well as prevention measures and procedures that prevent products or services from causing damages to stakeholders in the Ethical Corporate Management Best Practice Principles. The rules are intended to protect the rights of customers and prevent loss of assets, penalties, and damage to reputation.
According to the "Performance Management - Performance Contract," all LITEON employees have "Core Competency" as 15% of their KPI, which directly impacts their remuneration. One of the indicators under "Core Competency" is "honesty and integrity." Therefore, compliance is linked to employee remuneration. In case of any non-compliance, disciplinary actions will be taken, which could include a warning, minor/demerit, major demerit, or even termination of employment, depending on the severity of the violation.
LITEON requires newly-recruited employees to sign a statement of commitment to ethical conduct upon onboarding to help them understand the importance and necessity of ethical conduct. Furthermore, LITEON requires employees to complete anti-corruption training. To raise awareness of integrity and self-discipline, the company advocates compliance education and training regularly, and in addition to various seminars from time to time, organizes courses that help participants learn about the laws and key compliance issues, including LITEON work ethics, anti-corruption, insider information, and anti-trust issues. The Responsible Business Alliance (RBA, formerly EICC) offers the following in-person courses: business integrity, avoidance of illegitimate gains, protection of confidential information, protection of intellectual property, intellectual property rights, advertising and competition, contract risk management, fair trade, anonymity and confidentiality, anti-corruption, responsible minerals (metal procurement), environmental protection, privacy, and the prohibition against retaliation. The courses are provided to raise awareness of ethical standards in the workplace. (Please see the Employee Development and Training page for details of related training.)
As part of the internal control and audit system, internal inspections and reviews are conducted in individual units and subsidiaries, and the updates and results are disclosed in the annual report. Please refer to Page 71 for the results of internal control in the 2021 Annual Report.