Corporate Social Responsibility

According to the instructions of the chairman, the Company starts to report relevant work schedule and the implementation status to the Board of Directors quarterly in May 2022, in order to acquire opinions of the Board of Directors and to execute review and adjustment. The Company voluntarily published the first sustainability report on September 30, 2022, and the following annual sustainability report will be published in June every year, also disclosed on the Company’s website and TWSE MOPS.

The Board of Directors’ supervision expectation for the sustainable development shall include but not limited to: management policy, strategy and objective establishment, as well as review measures.

(a) 6. Analysis and assessment of the risk matters for the most recent year and up to the printing date of annual report of VII. Review and Analysis of Financial Status and Financial Performance and Risk Management.

(b) 3. Environmental Issues and 4. Social Issues of this paragraph.

(c) 4. Implementation of Corporate Governance of III. Corporate Governance Report.

The Company published the 2021 Sustainability Report on 2022.09.30, and according to the materiality principle, communication with stakeholders, and reviewing related regulations, the Company defines material issues and relevant management policies.

(2) Does the Company committed to achieving efficient use of resources and using renewable materials that produce less impact on the environment?

(3) Does the Company evaluate the climate change on the present and future potential risks and opportunities of the corporation and does the Company adopt relevant responsive actions?

(4) Does the Company statistically analyze the greenhouse gas emission, water usage and waste total weight over the past years and does the Company establish policies for reduction of greenhouse gas emission, reduction of water usage or other waste management?

a) Acquisition of Chain of Custody (CoC) certificate from Forest Stewardship Council (FSC), certifying that product wood raw materials comply with the forest governance concept and supervision with rigorous environmental protection, sustainable operation and ecological protection.

b) Products qualify the Total Volatile Organic Compounds (TVOC) and formaldehyde inspection compliance standards certified by the international SGS and China National Furniture and indoor Environmental Quality Supervision and Inspection Center, such that the health of consumers is considered and the emission of greenhouse gas is also reduced at the same time.

c) In 2019, the Company successfully developed the No Added Formaldehyde-based-resin (NAF) board, in order to reduce air pollution and also received the formaldehyde-free certificate issued by the U.S. CARB and EPA.

d) Qualified the toxic substance inspection certification for composite wood products formaldehyde control regulations under Title VI CARB Phase 2 of Toxic Substances Control Act (TSCA) of U.S. CARE and U.S. Environmental Protection Agency (EPA), thereby providing environmental quality assurance.

e) Acquired the Swiss SGS certification and the formaldehyde testing certificate complying with F-4 Star Standard of Japan Testing Center for Construction Materials (JTCCM).

f) Qualified the Japanese Industrial Standards (JIS) A5908 F-4 Star, F-3 Star and F-2 Star certifications.

(2) The Company is dedicated to the environmental protection policy and promoting the managing strategies that merge recycling economic and sustainable development, be participated in carbon neutral activities as a response to the sustainability issues.

The production raw materials of the Company use the rubber woods, an economic crop from Thailand, which involves no deforestation and has no adverse impact on the environment. The Company has also acquired the certificate from the Thailand Rubber Wood Association stating that the product source of the Company is rubber wood products complying with sustainable development.

The Company is committed to environmental protection, and implements garbage resource classification, recycles wooden dust distributed in the area, and transforms waste gas into thermal energy for recycled use in the production progress in order to improve resource reuse rate. In addition, the Company also introduces high-efficiency motors and frequency converters in order to increase energy use efficiency. The Company also uses thermal imagers to monitoring the production equipment in real time in order to reduce the loss of energy.

Using diesel in order to reduce the carbon emission.

Actual outcome: The Company’s particle board is made by recycling discarded rubber wood branches, bark, and waste materials produced in the production process of solid wood boards. In 2021 and 2022, the particle board produced by the Company can store about 1.23 million tons and 800,000 tons of carbon emissions as estimated, respectively.

(3) The company is located in the south of Thailand. The rainy season from October to November may cause floods due to abnormal climate change, resulting in a shortage of rubber wood harvesting difficulties. Affect short-term price fluctuations. However, the company has both solid wood and particle board business, with a relatively complete wood distribution network, so rubber wood can be purchased in bulk, which has the advantage of raw material acquiring, compare to other competitors. The impact of climate change on the Company is relatively low.

(4) The Company organizes the Energy Saving Committee, and has been committed to the promotion of energy saving and carbon reduction policy as well as the promotion of paperless measure for a long period time. The Company promotes paper recycling and re-use and electronic documents are used to replace paper documents along with the implementation on online signing and approval, in order to respond to the office energy saving and carbon reduction. In addition, the Company also implements general waste resource recycle and the process is further enhanced through waste control system, and wastes are handled by qualified contractor for complete and through processing and treatment.

The Company implements management and reduction of use on oil, gas, water and electricity, in order to achieve the energy saving, carbon reduction and greenhouse gas reduction policies (the statistical information covers GRH, GP and GPT, and the information will disclose in sustainability report that has obtained the confirmation opinion of the third-party verification):

a) The Company has installed the automatic warehousing system, in order to reduce the CO₂ generated by the use of forklift trucks. Waste gas is recycled as thermal energy in order to reduce the waste gas emission. Formaldehyde in the production waste gas is recycled and recused in order to achieve zero emission. Since 2018, the Company has implemented the wet electrostatic gas precipitator from Europe with performance superior to the national regulations of Thailand. In addition to the satisfaction of the environmental protection standards, the Company is able to achieve effective control effect on the PM 2.5 particles in the waste gas, SO₃ acid fog, organic pollutants, heavy metal pollutants etc., in order to create a green economy with sustainable co-existence with the environment.

b) The greenhouse gas emission

Unit：tonCO2

The company continues implementing energy-saving and carbon-reduction measures to reduce the emission risk of factory operations effectively and plans a schedule for GHG inventory and verifications.

Environmental wood debris and dust are recycled as fuel in order to reduce the external purchase of wood and use of diesel, such that the carbon emission is reduced at the same time. To achieve the goal of environmental protection, energy factory technology is improved and modified to further include the “Wood Flour Burner” nozzle, in order to use the wood skin and wood flour as the dual fuel of waste recycled fuel. Actual outcome: a total of approximately 27,190 tons of CO₂ carbon emission was reduced in 2021 and a total of approximately 14,551 tons of CO₂ carbon emission was reduced in 2022.

c) Water usage

Unit：10,000 liters

In response to climate change, the company is committed to the recycling of water resources and has installed an automatic detection system for wastewater quality online and water purification equipment. In 2022, the total release amount of wastewater is 55 m3, which is lower than the total wastewater amount of 92 m3 in 2021.

d) Waste

Unit：ton

The company is committed to reusing resources to achieve the goal of reducing waste. Products that fail quality control will be chipped and re-entered into the manufacturing process.

The Company does not produce hazardous waste, and non-hazardous wastes are categorized according to local environmental protection laws and regulations; the Company chooses a qualified vendor to clean up the waste and formulates relevant management procedures. In addition, the in-charge department shall perform on-site audits at least once a year, depending on the needs. If the audit result fails, the Company will force the vendor to stop the operation and improve within the requested time. If the improvement does not meet the requirements, the contract will be terminated, and change the vendor to another qualified vendor to fulfill the corporate responsibility of waste management.

ii. Specific management plans include,
a. The proportion of female employees in the company is about 28%. There is a breastfeeding room in the working area, and the number of days of maternity leave is better than Taiwan’s Labor Standards Act,
b. The company keeps a quota for employing disabled people to provide equal employment opportunities and the environment.
c. The company has a whistleblower mailbox and a labor opinion mailbox to provide employees with appropriate communication methods,
d. Other human rights management and employee benefits, Please refer to 5. Labor relations of V. Operational Overview.

(b) The Company’s salary and compensation policy complies with relevant laws of the government, and the reasonable salary and compensation of employees is determined based on the employees’ educational background, experience, and work performance. The Company has established the Employee Performance Evaluation Regulations, and also specified the Reward and Punishment System. In addition to the consideration of employees’ work performance, the Company also evaluates the ethical conduct standard of employees in order to protect the corporate image of the Company and to comply with the required corporate social responsibility of the Company.

The Company emphasizes employees’ rights and welfare and also shares profit earnings with employees, as well as maintain excellent working environment. Including comprehensive physical and mental care for all ethnic groups: A. Provide suitable work positions and facilities for disabled employees. B.The Company implements the equal remuneration criteria for the same job duties and equal promotion opportunity for employees of different genders. In 2022, the number of female employees accounted for 28% of all employees, and the number of female supervisors accounted for 8% of all management staff.

Please refer to (8) Employee Bonus and Directors’ and Supervisors’ Compensation of 1. Capital and Shares of IV. Status on Financing of this Annual Report for Employee Compensation information. Please refer to 5. Labor relations of V. Operation Overview of this Annual Report for other employee welfare.

(c) The Company establishes the dedicated occupational safety unit and is staffed with occupational safety personnel complying with the government license standards, and also inspects all items according to the plan as well as performs review and improvement, in order to ensure that the work environment provided complies with the regulatory standards. In addition, the Company also periodically organizes employee physical examination, work safety and environmental sanitation promotion. Please refer to 8. Employee Working Environment and Personnel Safety Protection Measures of V. Operation Overview of this Annual Report. The company has not experienced any major occupational accidents this year. The industrial safety education training and promotion in the past three years are as follows:

(d) The Company follows the Skill Development Promotion Act and employee annual training program every year to implement safety, hygiene and vocation related training to employees in order to increase employees’ competency in terms of occupational skills. Please refer to 5. Labor relations of V. Operation Overview of this Annual.

(e) The Company’s products are widely used in furniture and building materials and have qualified numerous international certifications and test qualification reports. The Company is committed to the reduction of organic compounds and formaldehyde volatilization, in order to achieve high quality particle boards and the sustainable development goals of eco-friendly, toxic free, healthy and clean environment, thereby protecting the health and safety of end consumers.

The Company has established the personal information protection regulations for managing and protecting customer privacy.

The Company and authorized dealers sign quality commitment letter and establish penalty clauses, and provide customer identification service, in order to ensure that customers receive the legitimate Green River boards and to eliminate any counterfeit products.

The Company provides the certificate from the Thailand Rubber Wood Association stating that the product source of the Company is rubber wood products complying with sustainable development to customers.

According to the characteristics and sales strategies of different products, the Company understands the customer and market demands in order to establish excellent customer relationship and diverse customer complaint channels (such as e-mail and communication software), thereby providing the most optimal services. In addition, the Company complies with relevant laws and international standard requirements during the execution of business.

(f) The Company establishes partnerships with suppliers based on the principle of equality and mutual benefit. In addition, the Company reviews the qualification of suppliers and contractors every half year according Vendor management policy, also implements audits irregularly in order to ensure the quality of supplies and operational requirements. Child labor is prohibited in the Company. The Company will formulate a code of conduct for suppliers and require suppliers to sign a consent letter to ensure that the Company’s suppliers do not violate labor practices or adhere to sustainability clauses, etc.Thereby achieving the promotion of social responsibility.

(b) The company’s sustainability report follows the Universal Standards 2021 (Universal Standards 2021) announced by the GRI Association in 2021 as the main comprehensive disclosure framework and echoes the “Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies, “Sustainable Development Goals” from SDGs, the framework set by the Task Force on Climate-related Financial Disclosures (TCFD), and “Sustainability Accounting Standards” from SASB.”

(1) The Company is dedicated to become an outstanding corporate citizen, and the Company continues to care for the education of disadvantaged groups, construct educational resource sharing, promote industry-academic cooperation, and outstanding talent cultivation. In addition, the Company also organizes various public welfare activities for socially disadvantaged group care, community medical health educational resource subsidies, and elderly care, etc. The public welfare activities span across the Songkhla region, Thailand, where the Company located and surrounding areas, and the beneficiaries include all major colleges and universities, local junior high and elementary schools, non-profit-seeking social organizations, and the general public. The Company also encourages employees to jointly participate in social welfare activities in order to assist employees to maintain physical and mental health as well as a work life balance, thereby achieving growth with the Company together. The Company allocates budget in scholarship and senior citizen care programs every year: (1) in 2022, the company provide low-income student scholarship, outstanding student scholarship and aid in campus construction is NTD 680 thousand. The Company cooperate with schools and government institutions, including the selection process and provide the scholarship on time. The Company hopes to assist the students with financial aid and encourage them to concentrate on their studies. (2) In 2022, the company provide for the senior citizen caring program is NTD 410 thousand. Monthly visits to the poor, seriously ill, shut-in, and disabled elderly in the community, and provide assistance and daily necessities subsidies. The total amount of donation and related CSR activities in 2022 was NTD 1,200 thousand.

(2) Since 2015, the Company has consecutively received various social welfare awards and social welfare service awards from the central government and local government. The Company seeks to attract people sharing the same notion to be committed to the care of socially disadvantaged groups. In addition, through the integration of government and local social resources along with the teamwork development model, the Company creates an organization operated based on innovation and human culture.

(3) The Company has passed the latest version of ISO 9001:2015 standard, which certifies the company’s production environment is safe, eco-friendly, stable, well-managed, and provides high-quality products and comprehensive services.

(4) To control environmental pollution, the Company has also installed relevant environmental protection equipment: waste water quality online detection system, water quality purification equipment, wet electrostatic precipitator system and Formaldehyde recycle system, etc.

In addition, the Company has established relevant corporate governance principles, including such as: “Rules of Procedures for Shareholders Meetings”, “Procedures and Rules of Board of Directors Meeting”, “Regulations Governing Procedure for Board of Directors Meetings”, “Regulations for Election of Directors”, “Rules Governing the Scope of Powers of Independent Directors”, “Audit Committee Charter”, “Regulations Governing Audit Committee Operation”, “Remuneration Committee Charter”, “Regulations Governing Remuneration Committee Operation”, “Regulations Governing Establishment of Internal Audit Systems”, “Code of Ethical Conduct”, “Ethical Corporate Management Best Practice Principles”, “Corporate Social Responsibility Best Practice Principles”, “Procedures for Acquisition and Disposal of Assets”, “Policies and Procedures for Loaning of Funds and Making of Endorsements and Guarantees accordingly”, “Regulations on Governing Related Party Transactions”, “Subsidiary Supervision and Management Regulations.”, “Management Operation Measures for Internal Material Information Processing and Prevention of Insider Trading”. In addition, the Company releases material information of the Company according to relevant laws, and periodically discloses financial and non-financial information. The Board of Directors also follows the responsibilities assigned by the shareholders in order to lead the operation of the Company and to effectively achieve the management function of supervising the management level.

(2) Does the company possess the list of its major shareholders as well as the ultimate owners of those shares?
(3) Does the company establish and execute the risk management and firewall system within its conglomerate structure?
(4) Does the company establish internal rules against insiders trading with undisclosed information?

(2) The company shall retain at all times a register of major shareholders with controlling power, and of the persons with ultimate control over those major shareholders and maintains excellent relationships with major shareholders.

(3) The Company has established relevant control mechanisms in the internal control system of the Company, “the Corporate Governance Best Practice Principles”, “Subsidiary Supervision and Management Regulations.”, “Regulations on Governing Related Party Transactions” according to the laws and audits regularly.

(4)

(a) The directors of the company handed in a declaration of willingness to comply with the SEC law when they were elected.

(b) Every employee has to sign a non-disclosure agreement when onboarding.

(c) The Company has established the “Management Operation Measures for Internal Material Information Processing and Prevention of Insider Trading” and “Code of Ethical Conduct” in order to regulate all employees, managerial officers, and directors of the Company as well as any person who has learned the information by reason of occupational or controlling relationship to prevent any conduct possibly involving insider trading, and the Company also implements audits and educational promotion periodically.

(d) In addition, the Company arranges related courses in our orientation training for new employees and managerial officers.

(e) The company arrange the BOD schedule for the next years in advance and reminds directors not to trade in the company’s stock during the closed period Board of Directors. The company updates  the latest laws and regulations for insiders and arranges relevant courses every year, in order to avoid directors violating the norm.

1. Basic requirements and values: Gender, age, nationality, and culture.
2. Professional knowledge and skills: A professional background (e.g., law, accounting, industry, finance, marketing, and technology), professional skills, and industry experience.

The members of the Board of Directors should be diversified and possess the below skills:

Please refer below table for the experience and professional ability of the members of the Board of Directors.

(continue)

The Company has seven directors, including three independent directors, and one of the independent directors is female and directors with employee status account for about 43% of all directors. The professional backgrounds of the Board Members include management, scientific/engineering, financial, environment fields, etc., and their profiles cover chairman, managerial officers, and professors. The Board Members with diverse knowledge, including industry and academic fields, match the Company’s diversity goal. Therefore, Directors can provide professional opinions in different aspects, beneficial to the company’s business performance and management efficiency.

Specific management objectives of the company’s diversity policy:

(2) Presently, the Company has established the Compensation Committee and Audit Committee, and the Company will further establish other types of functional committees depending upon the actual operation status and according to the regulatory requirements.

(3) The Board of Directors of the Company passed the Board Performance Evaluation Measures of the Board of Directors on 2019/12/25. In accordance with the procedure, the Company assesses the Board’s performance annually and submits the performance evaluation results to the Board of Directors, using them as a reference in determining compensation and nomination for individual directors. Please refer to (1) Board of Directors Implementation Status of 4. Corporate Governance Operation Status of III. Corporate Governance Report in this Annual Report for 2022 performance evaluation criteria and results.

(4) The Company assesses the suitability of the CPA yearly; The Company shall obtain the CPA independence declaration and referencing AQI results, then submit to the Board of Directors together. The annual assessment has submitted to the Board of Directors on 2022/03/25 and 2023/03/22, respectively. The criteria and major content are listed below:

Professionality-the service quality and timeliness from the CPA meet the needs.

Independency-the CPA don’t hold shares of the Company or any affiliate of the Company.

Interest avoidance-the CPA does not co-invest or share interests with the Company or any affiliate of the Company.

Rotation-As of the latest certification, the CPA has never provided the Company with the audit service for consecutive 7 years.

(2) No major difference.

(3) No major difference.

(4) No major difference.

(2) The main responsibilities of the corporate governance unit are to handle matters relating to board meetings and shareholders meetings according to laws, produce minutes of board meetings and shareholders meetings, assist in onboarding and continuous development of directors, furnish information required for business execution by directors and assisting with legal compliance. In addition, review the qualifications of independent directors in nomination, election, and performance period if in compliance with the related regulations and report to the Board of Directors; and handling of matters relating to the change in directors.

(3) The Implementation in 2022 is as follows：
A. furnishing information required for business execution by directors and arranging refresher courses:
(a) Providing the latest or amended law and regulations related to the Company’s business and corporate governance when the directors onboard and to update periodically.
(b) Furnishing information required for business execution by directors and maintaining the communication between directors and chief officers of each division.
(c) Assist in arranging meetings with chief internal auditor or CPA.
(d) Assist in arranging refresher courses.
(e) Assist in arranging factory on site visits.

B. Handling matters relating to board meetings and shareholders meetings procedures and resolutions in compliance with laws.
(a) reporting to the Board of Directors, independent directors or audit committee on the company’s corporate governance operations and confirming whether the company’s shareholders’ meeting and board meeting are in compliance with relevant laws and corporate governance codes.
(b) Assisting and reminding the directors which the laws and regulations that should be followed when executing business or making a resolution of the Board of Directors.
(c) Reviewing the material information announcement of an important resolution from the Board of Directors meeting to ensure the content’s legality and correctness for protecting investors have reciprocal transaction information.
C. Schedule the date of the Board of Directors meetings one year in advance with the expected agenda. Reminds directors of the meeting agendas and restate the insider trading-related regulations one month before the meeting. The agenda items and comprehensive pre-meeting materials for Board of Directors meetings shall be sent together with the notice of the meeting to each director at least seven days in advance. The Company shall remind directors if a director is an interested party with respect to an agenda item, shall enter recusal. The proposals in the meeting will be explained by the in-charge person each proposal by each. And finishing the minutes of a Board of Directors meeting within 20 days after the meeting.
D. In accordance with related laws and regulation to handle the pre-registration of shareholders’ meeting, to prepare the shareholders meeting notice, the handbook of the annual meeting of shareholders, the minutes of the shareholders meeting, and to handle the change of registration when the articles of association is amended, or the directors are re-elected.

(2) The Company assigns dedicated personnel to be responsible for the collection and disclosure of the Company’s information and to announce and report relevant information on MOPS, and the Company also establishes the spokesman system to be responsible for providing explanations to the outside in order to ensure that information possibly affecting the decision making of the shareholders and stakeholders to be timely and appropriately disclosed. Relevant information of the investor conferences organized or participated in by the Company has been published on the Company’s website and MOPS.

(3) The Company follows relevant laws and regulations to announce and report the annual financial statements based on the prescribed deadline, as well as the quarterly financial statements and the operating status of each month.

(2) Employee Care: The Company encourages employees to participate in various educational trainings, provides labor insurance and group insurance, periodically organizes employee health examinations, etc., establishes excellent interaction with employees, and values the rights and benefits of employees.

(3) Investor Relationships: The Company convenes shareholders meetings according to the Company Act and relevant laws in order to provide sufficient opportunities for submission of proposals by shareholders. In addition, the Company has also set up a spokesman and contact window to handle questions raised by investors. The Company has established the investor section on the Company’s website (including Traditional Chinese, English, and Simplified Chinese) and also discloses company financial and business information on MOPS according to the laws. Furthermore, the Company irregularly organizes or participates in investor conferences in order to protect the rights and benefits of investors, as well as to fulfill corporate responsibility for shareholders.

(4) Supplier Relationships: The Company maintains long-term and excellent collaboration relationships with main suppliers.

(5) Rights of Stakeholders: Stakeholders may communicate with and make suggestions to the Company in order to maintain their legitimate rights and benefits.

(6) Status on Educational Training of Directors and Supervisors: The Directors of the Company have all participated in corporate governance related courses. In addition, the Company has no supervisors.

(7) Implementation Status of Risk Management Policy and Risk Measurement Standards: The Company focuses on its core business and cooperates with the launch of all policies related to the laws, and also establishes operation of various standards to implement regulations in light of reducing and preventing any possible risks.

(8) Implementation Status of Customer Policy: The Company assigns dedicated personnel to handle customer complaints, and also properly determine the cause of issue and accountability in order to ensure service quality to customers.

(9) Status of Liability Insurance Purchased by the Company for the Directors and Supervisors: The Company has purchased liability insurance for all Directors.

(a) Matters Not Received for Scores and Already Improved: Does the Company appoint the Corporate Governance Officer responsible for corporate governance matters and disclose the duites and continuing education information?  On December 28, 2022, The Board of Directors appointed the Corporate Governance Officer responsible for corporate governance matters. Also, the Company allocated appropriate personnel to assist with corporate governance-related affairs. The duties and continuing education information information are disclosed on the Company’s website and the annual report.

(b) Priority Enhancement and Measures: Has the sustainability report prepared by the company been verified by a third party? Third-party verification has been arranged this year.