The Company has established the “Risk Management Policy and Procedures” in 2021, which was approved by the Board of Directors as the highest guiding principle for risk management of each unit. Risk management should be based on the Company's business strategies and objectives. Given such factors as business growth, risks and rewards, the Company has set risk standards to regularly evaluate and monitor each risk position, establish risk indicators and early warning mechanisms, and simulate future changes as far as possible to provide a basis for management response.
In addition, the following principles must be observed:
1. Clearly consider the uncertainties of ventures and acquire optimal information to devise the best course of action.
2. Allocate and use resources effectively.
3. Keep an eye on trends and changes to stay on top of potential emerging risks.
4. Step up stakeholder communication and trust.
5. Create a risk management culture and raise awareness of risk management.
1. The organizational structure is as follows
Board of Directors: is the highest supervisory body for risk management in the Company, responsible for approving the risk management policy, structure and culture
3. Risk Management Group: is the top guiding unit for risk management of the Company, responsible for formulating risk management policies, planning major risk management issues and overseeing the improvement of risk control, and reporting regularly to the Board of Directors at least once a year on the operation of risk management and the effectiveness of its implementation.
4. Operating units: responsible for the actual implementation of each unit's risk plan, including risk identification, risk analysis, risk assessment, risk response and control, and self-monitoring.
5. Audit office: an independent unit under the Board of Directors of the Company, assisting the Board of Directors in overseeing the execution of the risk management mechanism, checking the implementation status of risk response and control of each operating unit, communicating risk information with each operating unit, and collecting and consolidating risk management reports from each operating unit.
Risk identification refers to the process of analyzing the Company's operating environment and determining which events are likely to occur and why, based on internal and external environmental variables.
Each of the Company's operating units is required to identify possible sources of risk in its operations, compile past experience to predict possible future risks, categorize and regularly control the identified risks, and report the results of the risk identification.
If a risk event is unexpected, it must be reported immediately in order to avert significant damage to the Company. Risks that may occur include the following:
| Aspect | Type of Risk | Risk Description |
|---|---|---|
| Governance | Market Risk |
|
| Operational Risk |
|
|
| Investment Risk | includes risks to the Company due to over-concentration of investment targets, high risk and high leverage operations, fluctuations in the market price of short-term investments such as derivative transactions and financial management, or the risk of long-term investments in the operation and management of investee companies. | |
| Market Risk | includes the risk of failure to comply with various legal regulations or the risk of legal infringement of the Company's rights. | |
| Environmental Aspect | Environmental Risk |
|
| Social Aspect | Operational Hazard Risks |
|
| Human Resource Risk |
|
|
| Other | Other risks | Risks that do not fall under the above categories but that could result in significant losses to the Company, such as long-term emerging risks, significant external hazards, or tail risks arising from extreme events. In addition, if there are other risks, appropriate risk management procedures should be put in place depending on the characteristics of the risk and the degree of impact. |
The Company actively promotes a risk management mechanism and reports to the Board on its operation on an annual basis. The Company's risk management team reported to the Board on July 26, 2023, including the assessment and identification of the various risks faced by the Company, risk assessment and response measures for the year.
Fitipower regularly reports the results of its operations to the Board of Directors each year, and educates its employees on the “Ethical Corporate Management Best Practice Principles for TWSE/GTSM Listed Companies” and the Procedures for Ethical Management and Guidelines for Conduct,” insider trading regulations and related practices. Starting from October 2020, every new recruit is required to go through an orientation course on the ethical management policy.
Relevant Implementation in 2023:
| Course Title | Target Group | Number of Trainees | Total Training Hours |
|---|---|---|---|
| Ethical Corporate Management Best Practice Principles | New Recruits | 91 | 91 |
| Insider Trading Regulations and Case Studies | Directors | 4 | 12 |
| Introduction to Trade Secrets | New Recruits | 73 | 73 |
