Sustainability Strategy and Performance

An organization that facilitates sustainability

To implement the concept of sustainable management and fulfill corporate social responsibility, Alltek has established the “Sustainability Committee”.The committee consists of the company’s general manager and three independent directors to effectively promote the setting of the company’s sustainable goals. The committee includes sub-groups such as the Corporate Governance and Risk Management Subcommittee, Information Security and Process Management Subcommittee, Environmental Protection and Supply Chain Subcommittee, and Employee Care and Social Participation Subcommittee. These sub-groups are responsible for proposing, executing, and reporting on corporate sustainability-related matters. The chair of the Committee serves as the convener. Each team has a team leader who is responsible for the communication and coordination of matters under the control of the team, and compiles the information related to the team’s responsibility to facilitate various projects and respond to major issues of various functions.

Risk management

Alltek has adopted a “Risk Management Policy and Procedures” method, approved by the board of directors in 2022, to ensure stable operation and sustainable development. This includes establishing a sound concept of integrity in operations and regularly assessing risks to reduce operational risks. The risk management policy defines various risks according to the Company’s overall operating guidelines, and establishes a risk management mechanism for early identification, accurate measurement, effective supervision, and strict control of risks to prevents possible losses within the tolerable risk range. The best risk management practices are continuously being adjusted and improved in accordance with changes in the internal and external environment in order to protect the interests of employees, shareholders, partners and customers, while also increasing the value of the Company, and achieving the principle of optimizing the allocation of company resources.

Risk Management Organization

The Company’s Board of Directors is the highest decision-making body for the Company’s risk management, with the objective of complying with laws and regulations and promoting and implementing the Company’s overall risk management. The Board of Directors has a clear understanding of the risks faced by the operations in order to ensure the effectiveness of risk management and assumes the ultimate responsibility for risk management. The board of directors has established a “Sustainability Committee,” which includes various functional teams responsible for analyzing and monitoring risks within their respective units. The Risk Management Team is responsible for implementing and promoting various risk management policies, holding meetings at least twice a year, and regularly reporting risk management results to the Sustainability Committee.

• Internal audit

The internal audit of the company is an independent unit, staffed with one full-time auditor, directly reporting to the board of directors. They assist the board and management in supervising the various internal systems and processes, ensuring the effective implementation of the annual audit plan, and guaranteeing the effectiveness of internal audit procedures, the reliability of financial reporting, compliance with relevant laws and regulations, and providing timely improvement suggestions. This ensures the effective implementation of internal systems, solid supervisory mechanisms, and the execution of risk management controls.

Summary of Internal Audit Progress in 2024

The internal audit procedures specify the internal control of internal audit and review of the operating procedures of the Company. The adequacy, effectiveness and efficiency of the design and routine operation of such controls are reported, covering the Company’s operations and its subsidiaries.
Audits are carried out in accordance with the audit plan approved by the Board of Directors. The audit plan is formulated based on the identified risks. Special audits or reviews are also carried out as needed. The comprehensive audit and special projects above provide information on the operation status of the internal control function of the management and provide management with another channel to understand the existing or potential defects in a timely manner.
Internal audit: Review the self-inspection performed by each unit, including checking whether the operation is implemented and reviewing the documents to ensure the quality of execution, and compile the results of the self-inspection and the results of each cycle of audit operations, and issues an annual “Statement of Internal Control System” report to the Board of Directors.

Risk management procedures

The risk management process is divided into four stages. Each risk management unit examines its own business and operational characteristics, identifies possible risk factors that the Company’s operations may face, develops a complete risk classification framework, and defines appropriate measurement methods as the basis for risk management.

• Alltek reviewed its business and operational characteristics, and the risk categories and management measures for 2024 are as follows