Framework for
Sustainable Governance

The shareholder meeting serves as the highest body of authority for Chroma, and the Board of Directors led by the Chairman assumes responsibility for implementation and supervision of the various operations of the Company. To enhance the overall operational efficacy and decision-making power of the Chroma Group, the Chairman is also serving as the President of Chroma. Chroma has reserved three seats (of seven) for Independent Directors to boost independence of the Board. The Chairman maintains regular contact and communication with other members of the Board to touch base on the status of operation and performance in order to ensure proper governance and operation. All senior managers of Chroma are hired locally
Chroma has established a Compensation Committee in accordance with the “Regulations Governing the Appointment and Exercise of Powers by the Remuneration Committee of a Company Whose Stock is Listed on the Taiwan or the Taipei Stock Exchanges”. The ompensation Committee consists of three independent directors as its members, who have been appointed to serve a 3-year term. The committee meets at least twice a year and is responsible for assessing and reviewing the Company wage and salary system to ensure compliance with pertinent regulations and that it is adequately competitive to attract and retain outstanding talented individuals.

(1) There are currently three members on the Chroma Compensation Committee.

(2) )Duration of service for the current term: June 19 2017 through June 7 2020. The committee met twice in 2019 and member qualifications and attendance are summarized as below:
Title
Name
Actual number of attendances
Attendance rate

Independent Director

George Chen

2

100%

Independent Director

Tsung-Ming Chung

2

100%

Independent Director

Quincy Lin

2

100%

The relationship between the Chroma remuneration policy, standards and combinations, the processes of establishing reasonable remuneration and management performance and relevance to future risk is summarized as below:

(1) Directors: To determine fair compensation for the directors the following factors are taken into account: the overall operational performance of the Company, future management risk and the development trends in the sector as well as individual contribution to Company performance. Remuneration for the directors is reviewed and approved by both the Compensation Committee and the Board of Directors. The remuneration scheme is also subject to review at any time in accordance with the status of the Company operations to ensure an ideal balance between sustainable management and risk control.

(2) President and VP: Chroma has established the “Remuneration Management Procedure for Senior Managers”, which states that the Company shall refer to the salary standard of competitors in the industry during the appointment of President/VP to determine remuneration in the form of a fixed monthly salary. Any change in remuneration for the President/VP shall be handled as an employee salary, which will depend on the company operational performance for the year as well as their personal performance. A salary adjustment proposal shall be submitted to the Compensation Committee for review and be approved by the Board of Directors.

(3) The Company shall plan the budget for the next fiscal year at the end of each year and take factors including the status of the economy, confidence of management in the overall company operation and risks for the following year, to make the appropriate adjustments to remuneration for managers to accomplish the expected level of operational performance.
Chroma welcome your voice and please do not hesitate to contact us!

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