Report Summary - Taishin Financial Holdings...Report Summary This 2014 Corporate Social Responsibility Report (“the CSR Report”) presents the CSR performance of Taishin Financial

If you have any suggestions with regards to this CSR Report or Taishin Financial Holdings’ CSRplanning and practices, please contact:

Taishin Financial Holdings, Corporate Communications Dept. No. 118, Sec. 4, Ren-ai Road, Taipei, Taiwan http://www.taishinholdings.com.tw/englishTel.: +886-2-2326-8888 ; Fax: +886-2-3707-6680

Report SummaryThis 2014 Corporate Social Responsibility Report (“the CSR Report”) presents the CSR performance of Taishin Financial Holding Co., Ltd. (“Taishin Financial Holdings”, “Taishin FHC”, “Taishin” or “the Company”.) The reporting period, scope, contact information, and other relevant information are highlighted below:

Reporting PeriodThe CSR Report is the second

corporate social responsibility r e p o r t c o m p i l e d b y Ta i s h i n

Financial Holdings. It showcases the progress of the Company in fulfilling

its corporate social responsibilities and meeting sustainability goals during 2014.The information contained herein, however, may

involve consolidated data from other years. The CSR Report will be compiled and

publicly disclosed on a yearly basis in the future.

The previous version was published in August 2014.

Scope of ReportThe CSR Report covers the

initiatives undertaken by Taishin FHC and its subsidiaries (namely

Taishin Bank, Taishin Securit ies, Taishin Securities Investment Trust,

Taishin Securities Investment Advisory, Taishin Asset Management, Taishin Venture Capital, and Taishin Holdings Insurance

Brokers) and the two foundations (namely Taishin Charity Foundation and Taishin

Bank Foundat ion fo r Ar ts and Culture) to fulfill their corporate

social responsibilities,and the progress of these efforts.

Reporting BasisR e p o r t i n g w a s m a d e i n

accordance w i th the GRI G4 S u s t a i n a b i l i t y R e p o r t i n g

Guidelines and the Financial Service Sector Supplements

(FSSS).

Information Disclosure

All financial information contained in the CSR Report, including the operating

income and expendi ture of Taish in Financial Holdings, is presented in New

Taiwan Dollars (NTD) and has been audited by a certified public accountant.

Statistics in the CSR Report follow the current international standards and are rounded to the nearest

integer. Figures not contained in the financial statements are presented, in principle, to two decimal places if not integers. In

addition, figures in the “Environmental Protection” section are calculated based on information released by the

government. The term “local” used herein means the countries or areas where the business is operated.

The CSR Report will be published and made available to stakeholders on the Taishin

Financial Holdings website. Please direct all inquiries and suggestions to

the contact personnel of the CSR Report.

Report AssuranceThe CSR Report was prepared

in accordance with the GRI G4 Guidel ines. I t has been reviewed

in terna l ly by the Corpora te Soc ia l Responsibility Committee. Externally, it

has been confirmed by the British Standards Institution (BSI) to be in compliance with the

AA1000 Accountability Principles of materiality, inclusivity and responsiveness. In addition, Deloitte

& Touche (Taiwan) has been engaged to provide Limited Assurance for the CSR Report based

on ISAE3000, confirming its compliance with the GRI G4 core disclosure principles.

For details regarding the assurance items and scope, please refer to the

independent verification statement appended to the CSR Report.

Taishin Financial Holdings CSR Report is printed on heavy-metal-free paper and with eco-friendly soybean-based ink.Copyright © 2015 Taishin Financial Holding Co., Ltd. All Rights Reserved.Printed in Taiwan 08/2015

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In 2014, Taishin Financial Holdings issued its first Corporate Social Responsibility Report which was awarded the “Taiwan Top 50 Corporate Sustainability Report Award” by the Taiwan Institute for Sustainable Energy (“TAISE”). The Company was also included in the “Taiwan High Compensation 100 Index”. For Taishin, these honors reflect the ongoing obligation of the Company to further meet its corporate social responsibilities which are imperative to the sustainable development of its business.

The Company has been constantly thinking of ways to further integrate group resources, systemize CSR implementation procedures, and incorporate them into daily operations, so that good CSR ideas are converted into real actions. When starting to compile the first CSR report, the Company therefore initiated and developed various mechanisms. The overall economic, social and environmental factors were carefully taken into account when developing the action list. The goals and strategies for the 2014 CSR project include: organization of the “Corporate Social Responsibility Committee”, establishment of the “Corporate Social Responsibility Best Practice Principles”, “Corporate Governance Best Practice Principles”, and “Business Ethics Principles”, as well as the amendment of the “Suppliers Management Guidelines.” These initiatives have all been successfully completed, showing the Company’s commitment to realize its corporate social responsibilities.

The serious food safety and environmental problems which occurred in 2014 did cause great panic and distrust in

Taiwan. They also adversely impacted the trustworthiness of Taiwanese products in the international market. As a member of Taiwan financial industry, Taishin deeply awares we should not only fulfill day-to-day activities into corporate social responsibilities but also deepen the practice of corporate social responsibilities through credit review policy. For the next stage of the CSR project, therefore, Taishin incorporated economic, environmental and social risk factors into the credit review process based on the Equator Principles. The purpose is to raise the CSR awareness of customers, engage them in CSR efforts, and ensure the prosperity and sustainability of society in Taiwan.

Looking forward, Taishin will make determined efforts to understand the expectations and concerns of its stakeholders, and respond to them with aggressive actions. Taishin aims to incorporate all CSR issues into its mid- and long-term business plans and to ensure their full implementation. These include continuous optimization of Taishin’s products and services, protection of customer interests, enhancement of corporate governance mechanisms, strengthening employee training and care, as well as other efforts related to compliance, supplier management, and environmental protection. The ultimate goal is to achieve sustainable and balanced development in economic, social and environmental aspects. Taishin endeavors to make itself a role model in the country, working together with all to create a better future for Taiwan.

Commitments and Visions

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About Taishin

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I.Company Profile

2014 Corporate Social Responsibility Report

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Subsidiaries Services No. of Service Locations

Taishin International Bank Co., Ltd. Wealth management, retail banking, wholesale banking, electronic banking, and trust services 104

Taishin Securities Co., Ltd.Proprietary securities trading, securities brokerage, securities underwriting, futures introducing broker, and other business activities as approved by the competent authority

3

Taishin Securities Investment Trust Co., Ltd.

Raising of securities investment trust funds against issuance of beneficial certificates, and investment of funds in securities and other related instruments

3

Taishin Securities InvestmentAdvisory Co., Ltd.

Investment research and analysis; Master agent of the Jupiter Fund 1

Taishin Asset Management Co., Ltd.Acquisition of monetary debts from financial institutions; debt rating and sales; debt management and overdue accounts management for financial institutions

1

Taishin Venture Capital Investment Co., Ltd.

Venture Capital Business 1

Taishin Holdings Insurance Brokers Co., Ltd.

Life insurance and property insurance brokerage. 1

Foundations Services

Taishin Charity FoundationDisaster/emergency relief, medical assistance for the poor, public welfare sponsorship, life skills development for the less-advantaged, and other social welfare activities

Taishin Bank Foundationfor Arts and Culture

Supporting and encouraging outstanding arts and cultural workers and organizations; sponsoring diversified art performances, exhibitions, promotional activities and seminars; as well as related publications and promotional literature.

Base date: Dec. 31, 2014

Company Name

Taishin Financial Holding Co., Ltd.

Company Type TWSE-Listed Company

Date of Incorporation

Feb. 18, 2002

Core ValuesIntegrity, Commitment,Innovation and Collaboration (ICIC)

Brand Spirit Dedication

Headquarter No. 118, Sec. 4, Ren-ai Road, Taipei, Taiwan

Number of Employees

7,574

Total Capital NTD95.669 Billion

CSR Website https://www.taishinholdings.com.tw/english/human/human_10.jsp

● Taishin Financial Holdings has seven subsidiaries. There are two foundations under Taishin Bank.

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Dedication – The “Taishin” Spirit “Dedication” is the spirit of the Taishin brand. It is the resolute attitude of all Taishin employees hold, and the core value we advocate to achieve the brand presence.

“Dedication” is the drive for all innovation efforts. Adhering to its customer-oriented philosophy, Taishin endeavors to develop innovative products and platforms to provide more professional and friendly financial services. In 2014, Taishin was awarded many major international awards, including the “Best Mobile Banking Platform” (MILSTE), “Online Banking Initiative of the Year” (Asian Banking & Finance), and “Card Benefits Program, Asia” (Cards & Electric Payments International).

“Dedication” is also the reason for Taishin’s persistent participation in social welfare activities, including charity, art promotion, and sports sponsorship. Following the establishment of Taishin Charity Foundation in 2010, in the same year the Company launched the “Power of Love” campaign, providing charity funds to small and medium-scale charity organizations through the concept of “Taishin Charity Cloud”. With this platform, Taishin has integrated the resources of those involve to help these organizations to achieve financial independence. Taishin Bank Foundation for Arts and Culture, on the other hand, has been devoted to the promotion of contemporary arts. Having hosted the Taishin Arts Award for twelve consecutive years, the Foundation created the ARTalks website in 2013 to provide an online platform for art commentary and discussion. In terms of sports sponsorship, Taishin has continuously sponsored the karate team in Nantou County, where had been seriously devastated by the 921 Earthquake. One of the team members subsequently won a gold medal in the Asian Games. In the meantime, the Company has taken concrete actions in sponsoring talented female golf players, including Yani Tseng, the first Taiwanese golf player to achieve the number one ranking in the Women’s World Golf Rankings.

“Dedication” has been fully demonstrated in the daily life of Taishin employees who have conscientiously listened to the customers’ feedback and examined their service quality under the “3S” standards: simple, sincere and superior. To highlight the Taishin spirit and build positive momentum for the brand, Taishin colleagues have been actively engaged in voluntary work on top of their roles in the financial industry.

Taishin Tower – The Fortress of DedicationInaugurated in March 2006, the Taishin Tower is located along the magnificent green boulevard near the Renai Circle. Jointly designed by the globally-renowned Pei Cobb Freed & Partners Architects and Haigo Shen & Partners, Architects & Engineers in Taiwan, the tower showcases a harmonious union of green concepts, urban landscaping, community resource sharing, and cultural entertainment within the business headquarters. This is also the first urban renewal project approved after the implementation of the Urban Renewal Act. For this reason, Taishin strived not only to fulfill its own business needs, but also the vision of the city.

Taishin Tower is recognizable due to the pleasant curves of its facade, mimicking the shape of an open book. Aerial view of the tower conveys the image of a water droplet. Without any hard and dominating structural lines, the design well fosters integration between the tower and the surrounding neighborhood. Free from any visual obstructions created by beams or columns, visitors are delighted with the panoramic views of the Renai Circle through the glass curtain wall. Besides architectural beauty, the headquarters are environmental-friendly in terms of energy and water saving, waste reduction, as well as health, hygiene and comfort. M o r e o v e r , the low-reflective glass curtain helps r e d u c e heat radiation in the vicinity. To further harmonize the building with the city, the architecture team also brought in a dynamic lighting design to achieve aesthetic pe r f ec t i on . When t he sun goes down, people a re amazed by the sp lendid “River o f Light” flowing in the night sky.

II.Brand Story

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I.Evolution of CSR Topics in 2014II.Responses to Specific Topics of Concern for Stakeholders

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CSR Topics Analysis

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I.Evolution of CSR Topics in 2014Management Methods and Focuses for CSR Topics

2013 2014

Report Applied Standards Referenced GRI G3.1 guidelinesReferenced GRI G4 guidelinesCSR management topics portrayed as independent chapters

Management of Significant Topics

Identify significant topics of stakeholders concern through analyzing level of stakeholder concern

In addition to existing methods in year of 2013 analysis, Taishin also included the social development trend, social sustainability issues, and traits of the financial industry into analyzing level of stakeholders concern in year of 2014.

CSR Topics Impact Assessment Executed by management level representatives

Executed by the Corporate Social Responsibility Committee’s executive council

Disclosure of Matenal Aspects and Management Methods

Significant topics and management approach disclosure according to the GRI G3.1 guidelines

Add management thinking and correspond to the planning of management approaches and strategy direction according to GRI G4

Step 1: Confirm degree of relations between stakeholders and Taishin

Confirm degree of relations between stakeholders and Taishin

Analysis of significant topics

Respond to topics' aspects and establish management approach

Stakeholders' Topics of Concern and Communication Management

Step1 Step2 Step3 Step4

Chart: Steps for Analysis of Stakeholders and Significant Topics

Taishin understands that while pursuing sustainable growth in our corporation, we should meet stakeholder expectations by understanding their topics of concern and transforming these topics into opportunities for innovation and progress for the business. Therefore, Taishin has carried out analysis and assessment procedures regarding stakeholders and significant topics through the following four steps. And then, planning and implementation of sustainable development is carried out by emphasis on significant topics of concern for stakeholders and organizational operational topics which impact stakeholders.

To confirm the extent of Taishin’s relationship with stakeholders, Taishin organizes stakeholders into categor ies and compi les the opinions of var ious departments and subsidiaries. Main stakeholder categories and degree of relation are determined through systematic analysis and identification.

Degree of relationship to stakeholders(Degree of relationship ranked from high to low)

Responsiblity

Dependency Impact

Closeness

Policy and Strategy

Identify stakeholders

Representativeness

Em

ployees

Analysis of Stakeholder Relation Level

Shareholders /

Investors

Suppliers

Com

petent A

uthorities

Custom

ers

Media

Local C

omm

unities

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CSR Topics Analysis｜ 2014 Corporate Social Responsibility Report

Step 2: Analysis of Significant Topics

Taishin listed the 2014 Sustainability Issues (CSR Topics) listed charts according to features of the financial industry, current social development trends, experience and feedback from stakeholders communication, while also taking into account sustainability trends and incidents which took place during this year. Then, various topics of possible stakeholder concern are assessed, and stakeholders are invited to rank these topics via interview and survey. Taishin utilizes the scores to identify significant topics of concern for stakeholders. At the same time, the Corporate Social Responsibility Committee’s executive council has conducted an opinion survey to identify potential issues which could impact on the Taishin’s operations, as shown below.

Topics of Concern Analysis

Degree of Relation CSR Topics

High

Privacy & Transaction SecurityBusiness Sustainability Strategy Service Quality and Customer SatisfactionInformation TransparencyCorporate GovernanceProduct RiskBusiness Performance

Medium

Service InnovationLegal ComplianceRisk ManagementHiring and TrainingRemuneration, Benefits & Employee CareOccupation Safety and HealthSocial WelfareHuman Rights and Gender Equality

Low

Employee-Employer RelationshipAward ParticipationSupplier ManagementEnvironmental Protection and Energy ConservationEco Preservation

Degree of Impact CSR Topics

High

Product RiskLegal ComplianceCorporate GovernancePrivacy & Transaction SecurityService Quality and Customer SatisfactionRisk ManagementBusiness Sustainability StrategyBusiness PerformanceRemuneration, Benefits & Employee Care

Medium

Social welfareInformation TransparencyEmployee-Employer RelationshipHuman Rights and Gender EqualityOccupation Safety and HealthSupplier ManagementHiring and Training

Low

Service InnovationEnvironmental Protection and Energy ConservationEco PreservationAward Participation

Topics of Concern List Topics of Impact List

For examples: Sustainability Strategy, Climate Change, Human Rights Protection, Anti-corruption, Supply Chain Management1

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No. Significant Topics Material Aspects Significance and Implementation for Taishin Chapter of the Report

1Privacy & Transaction Security

• Customer Privacy • Maintaining customers’ rights• Comply with legal regulations

Customer Service and Commitment

2Business Sustainability Strategy

• Strategy and Analysis*

• Organizational Profile*

• Continual profit and active feedback• Develop sustainable development in various aspects

Mission and Vision

3Service Quality and customer Satisfaction

• Marketing Communication

• Product and Service Labeling

• Active development of products and services• Continually enhance service quality

- 2014 Performance Highlight

- Customer Service and Commitment

4 Corporate Governance

• Anti-Corruption• Public Policy• Anti-Competitions

• Strengthen Board of Directors operations• Execute internal controls and internal auditing procedures

2014 Performance Highlight

5 Product Risk• Product and Service Labeling

• Product Policy

• Comply with legal regulations• Develop products which meet customer needs


6 Business Performance

• Economic Performance

• Market Presence

• Ensure shareholders’ rights• Concern for employee benefits and recruitment

- 2014 Performance Highlight

- Employee Care* General disclosure category

Materiality Matrix Diagram

Significant Topics and Material Aspects Response Chart

Key issues of stakeholders' concern are of utmost importance to Taishin. To ensure a solid foundation of communication with stakeholders while staying true to the philosophy of sustainable development, Taishin has developed management approach for various aspects, according to corresponding results to these topics. While meeting stakeholder expectations, this also enhances Taishin’s capacity for sustainable development, implementing the spirit of sustainable development through all levels of the organization. The hope is to bring about a more positive social impact on society.

Step 3: Respond to Topics’ Aspects and Establish Management Approach

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Sustainability Topics Aspects

Information Transparency • Economic Performance

Service Innovation • Strategy and Analysis*

Legal Compliance • Compliance

Risk Management • Anti-Corruption• Anti-Competitions

Hiring and Training • Training and Education

Remuneration, Benefits & Employee Care

• Diversity and Equal Opportunity• Equal Remuneration for Women and

Men

Occupation Safety and Health • Occupational Health and Safety

Social Welfare • Indirect Economic Impact

Employee-Employer Relationship • Employment

Award Participation • Organizational Profile*

Sustainability Topics Aspects

Supplier Management • Purchasing Practices

Employee-Employer Relationship • Employment

Environmental Protection and Energy Conservation

• Energy• Water• Emissions• Effluents and Waste• Compliance• Overall Situation

Eco Preservation • Biodiversity

Human Rights and Gender Equality

• Investment• None Discrimination• Child Labor• Forced or Compulsory Labor• Security Practices• Indigenous Rights• Supplier Human Rights Assessment• Human Rights Grievance Mechanism

* General disclosure category

Dimension AspectsManagement

Approach

Number of Indicators Disclosed

BoundariesWithin the

Organization Outside the Organization

Taishin FHC

Subsidiaries/Foundations

Competent authorities

Stockholders/Investors Suppliers Customers Communities Media

Aspects Corresponding to Significant Topics

Social D

imension

Product R

esponsibility

Customer Privacy

• Customer satisfaction surveys periodically

• Comply with legal regulations regarding introduction, sales and marketing of related financial products, and establish audit mechanisms

• Establish personal information protection management system

1 ● ● ● ●

Marketing Communication 2 ● ● ● ● ●

Product and Service Labeling 5 ● ● ● ●

Product Portfolio 8 ● ● ● ● ●

Society

Anti-Corruption • Establish corporate governance guidelines, honest business guidelines ,related regulations and employee rotation policy

3 ● ● ● ● ●

Public Policy 1 ●

Anti-Competitive Practices 1 ● ● ● ●

Econom

ic Dim

ension

Economic Performance

• Periodically disclosred in annual reports and financial reports, made available on the official website

• Enact future strategy directions based on internal and external environment and operation conditions in annual strategy meeting

3 ● ● ● ● ●

Market presence 2 ● ● ●

Self-Disclosed Sustainability Topics and Aspects Comparison Chart

Aspects and Boundaries

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Aspects in Response to Self-Disclosed Topics

DimensionAspects

Management

Approach

Number of Indicators Disclosed

Boundaries

Within the Organization Outside the Organization

Taishin FHC

Subsidiaries/Foundations


Stockholders/Investors Suppliers Customers Communities Media

Environm

ental Dim

ension

Energy • Comply with related environmental regulations

• Continual implementation of energy conservation measures (taxi ridesharing, indoor temperature settings, etc.)

• Continual promotion of water and energy conservation measures

• Quantify recycling and reduce waste

2 ● ● ●

Water 2 ● ●

Emissions 3 ● ● ●

Effluents and Waste 2 ● ●

Compliance 1 ● ● ●

Overall 1 ● ● ●

Biodiversity 4 ●

Social D

imensio

Labor Practices and D

ecent Work

Employment

• Comply with the Labor Standards Law and relevant regulations

• Establish employee behavior guidelines and related procedures

• Establish an Occupation Safety and Health committee to uphold a good working environment

• Arrange for employees to attend online and physical training courses periodically

3 ● ● ●

Occupational Health and Safety

2 ● ● ●

Training and Education 3 ● ● ●

Diversity and Equal Opportunity

1 ● ● ●

Equal Remuneration for Women and Men

1 ● ● ●

Hum

an Rights

Investment

• Carry out human rights and labor rights management according to related labor regulations and standards

• Establish supplier management guidelines

1 ● ● ● ●Non- Discrimination 1 ● ● ●

Child Labor 1 ● ● ● ●Forced or Compulsory Labor

1 ● ● ● ●

Security Practices 1 ● ● ●

Indigenous Mechanisms 1 ● ●

Supplier Human Rights Assessment

1 ● ● ● ●

Human rights grievance mechanism

1 ● ● ● ●

Product

Responsibility

Compliance

(The same with product responsibility management guidelines as for the Social Dimension)

1 ● ● ● ● ●

Society

Compliance(The same with social management guidelines as for the Social Dimension)

1 ● ● ● ● ●

Econom

ic D

imension

Indirect Economic Impacts

(The Same with management guidelines as for the Economic Dimension)

2 ● ●

Procurement Practices 1 ● ● ● ●

6 major issues, 9 major considerations, 16 specific indicators for disclosure, 10 supplemental financial industry indicators, and 38 specific indicators for self-disclosure were identified according to the major issues and impacts analysis results.

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Stakeholder Communications and Communication Channels

Stakeholder Category Topics of Concern Main Communication Channels Communication

Frequency

Competent AuthoritiesCorporate GovernanceInformation TransparencyLegal Compliance

• Market Observation Post System• Taishin Financial Holdings website• Competent Authorities’ supervisory and audit activities• Copetent Authorities’ policy meetings or seminars• Telephone• E-MAIL• Written correspondence

From time to time

Stockholders/Investors

Corporate GovernanceBusiness PerformancePrivacy & Transaction Security

• Market Observation Post System Monthly

• Analyst Meetings• Roadshow/IR Conference• Taishin Financial Holdings website

Quarterly

• Shareholder’s meeting Annually

• Telephone• E-MAIL• Written correspondence• Taishin Financial Holdings IR website

From time to time

EmployeesBusiness PerformanceHiring and TrainingOccupational Safety and Health

• Taishin University e-newsletter Monthly

• Taishin’s morning conference and e-newsletter Quarterly

• Employee engagement surveys Every two or three years

• Employee opinions mail box• Employee health courses• Human resources portal• Internal announcements

From time to time

Customers

Privacy & Transaction SecurityService Quality and Customer SatisfactionInformation Transparency

• Voice of customer (VOC) collection platform• 24-hour toll-free hotline (0800)• Branch Service Opinion Forms• Fax• Customer service e-mail• Customer satisfaction telephone surveys

Daily

• Member publication/ e-newsletter• Taishin monthly magazine• Branch bulletin boards

Monthly

• Branch service telephone surveys Quarterly

• Customer satisfaction and loyalty surveys• Corporate investment and hedging seminars Annually

• Taishin Financial Holdings and subsidiaries' websites• Finance, investment and health seminars• Event promotions• Letter notifications

From time to time

Suppliers

Supplier ManagementBusiness Sustainability StrategyService Quality and Customer Satisfaction

• Supplier satisfaction surveys Monthly

• Business service seminars• Price negotiation meetings From time to time

MediaCorporate GovernanceBusiness PerformanceInformation Transparency

• Conversation Daily

• Press conference or seminar• Press release• Media gatherings• Spokesperson policy

From time to time

Communities and Social Groups

Social WelfareBusiness Sustainability Strategy Award Participation

• Art Talk on Philharmonic Radio Taipei Weekly

• Friday noon concerts Biweekly

• Online marketing platform Monthly

• Taishin Arts Award Exhibition• "Power of Love" campaign• Adopt My acre of land• Sponsor teen karate team members/golfers of Nantou

Annually

• Exhibition at the Taishin Tower• ARTalks website• Employee Volunteers’ visiting NPOs• Finance, investment and health seminars• Children Financial Education Camps at nearby schools• Charity Art Programs

From time to time

Step 4: Stakeholders' Topics of Concern and Communication Management

Taishin continues to focus on the highly concern topics of stakeholders to fully understand stakeholder’s expectations and to elevate sustainability topics management.

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II.Responses to Specific Topics of Concern for Stakeholders

Topic 1 Chang Hwa Bank (CHB) Investment

Stakeholder Category Topics of Concern Time of

Query Taishin’s Response

Competent Authorities

Accounting treatment for investment in CHB

Fourth quarter, 2014

Responses via email

InvestorsThe profit impact of investment in CHB(1) Profit recognition method(2) Impact of director re-elections

Whole year, 2014

The IR department provided explanations via email, telephone, or face-to-face meetings, further supplemented by website information disclosure.

Media Related developments to the CHB case Whole year, 2014

Different topics with different communication methods For example, immediate responses via: telephone, email, press conference, informational meeting and press release. If reports differ from the reality, the Public Relations department issues standard statements of explanation.

Investment Background

On July 22, 2005, Taishin Financial Holdings (“Taishin”, “Taishin FHC”) participated in an open bid for 1.4 billion shares of preferred stock for Chang Hwa Bank (“CHB”), with management control. Both domestic and foreign institutions participated in the bid, including Temasek Holdings, Mega Financial Holdings, and Taishin. Taishin won the bid with approximately NT$36.568 billion, obtained 22.55% of CHB’s shares and became CHB’s single largest shareholder.

Promises Made by the Min is t ry of Finance(MoF) prior to the Bid

On July 21, 2005, MoF issued an official letter to all bidders who participated in CHB’s 1.4bn preferred share bid. In the specific official letter, MoF promised to transfer CHB’s management control to the winning bidder and to support the winning bidder to get majority of CHB board seats.

CHB’s Previous Board Elections

For three consecutive terms of CHB’s board election in 2005, 2008 and 2011, MoF kept its promise to support Taishin in obtaining board majority.

However, MoF reneged on its promises made in 2005 without any legitimate reason in CHB’s 2014 board election. Prior to CHB’s Extraordinary Shareholder’s meeting, MoF called on the state-run banks and its affiliates to buy CHB shares and had 15 brokerage houses for proxy solicitation. While Taishin remains the largest shareholder of CHB, only 2 of 6 general directors are Taishin representatives and 1 of 3 independent directors is nominated by Taishin FHC.

Taishin Loses Management Control of CHB

MoF’s breaking its own promises made in 2005 has caused Taishin to lose management control of CHB, which resulted in significant losses to Taishin and hurt its shareholders’ interests. According to the international financial reporting standards and related rules, Taishin has recognized NT$14.776 billion losses on its CHB investment. (The aforementioned details can be found in major notices issued via MOPS on December 8th, 9th, and 25th 2014)

In order to protect Taishin’s 200,000+ shareholders’, Taishin has taken legal action and has hired law firms to represent Taishin to file a civil claim against MOF at the Taipei District Court. Taishin expects to urge MoF to honour its written promises made in 2005 and regain Taishin’s management control over CHB through legal remedy. Taishin also reserves its right to claim damage compensation against MoF for its improper action causing Taishin’s significant losses. Related contents have been published as major announcements on December 9th and 11th, 2014.

Taishin Feels Deep Regret for MOF’s Breaking its Own Promises

Taishin believes the trust toward government to perform its duties by laws and fulfill its obligations and promises are essential to a society governed by the rule of law and free-market economy principles. This trust also plays an important role in foreign institutional investors’ assessment on Taiwan investment environment and is the foundation when government is promoting corporate social responsibility. MoF has made a bad example of government practice and its interventionist tendencies.

From the responses above, investors and the media can

have a full picture of progress being made on this issue.

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Topic 2 Adopting a Nomination System for Board of Director Elections

Stakeholder Category Topics of Concern Time of Query Taishin’s Response

InvestorsWhen the board of directors election will adopt a nomination system

Whole year, 2014

Responses and notifications via email or telephone

A nomination system has applied to Taishin Financial Holdings’ independent director elections, and will apply to non-independent director election at the 7th Term Board of Directors election (Expected in 2018).

Topic 3 Related Disclosures of Derivative Products Sales



Ensure that sales of financial products are executed according to KYC and KYP regulations, in order to establish appropriate risk management mechanisms and safeguard customers’ rights

First half of 2014

Official correspondence was prepared in response to risk management and monitoring procedures and related measures for sales of financial products, with government agency approval of the product concentration risk management mechanism, risk disclosures, and client risk assessment (KYC) procedures established by our company.

In addition to establishing risk management and monitoring procedures and reports and continually pursuing implementation of KYC and KYP related regulations, customer risk tolerance, level of experience and knowledge, trading purposes, and estimated transaction volume for various products are all used as references when approving credit limits. Before each transaction, customers are also required to sign and complete a financial transaction agreement and risk disclosure statement so that customers receive appropriate disclosure and are fully informed of their rights.

Topic 4 Service Quality and Customer Satisfaction


Customers

• Improvement suggestions to service items

• Affirmation of branch services

Whole year, 2014

Staffs or supervisors responded to clients in person or over the telephone.

Service Improvements

The bank immediately responds to the customer and quickly implements improvements or provides feedback to the relevant units as a reference to implement operational execution adjustments when customers provide suggestions to Taishin Bank employees, or express their opinions through various customer service channels and service satisfaction evaluation forms. The responsible sector also takes the action plan and follows up the execution results.

Affirmation of Branch Services

The staff and their supervisors show the appreciation to the customers in person or via telephone. The administrative unit will carry out a subsequent telephone interview with the customer to learn more about staffs’ outstanding service actions for service recognition and to share exemplary service experiences.

The responses above demonstrate customers’ recognition of how Taishin values customer opinions.

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Topic 5 Taishin Employee Training and Development


Employees The possibility of expanding applications of training points

Whole year, 2014

According to employee suggestions, the HR department decided to provide employees with a wider scope of use for their training points after discussion. An official announcement was made regarding the expansion of subsidy scope for the training bankbook (foreign language learning institutes, overseas certifications).

Taishin University’s Training Point System

The company allocates 10,000 training resource points to each colleague annually as for personal development plans outside of official training courses. This was originally only limited to subsidies for second expertise courses, as well as physical attendance of foreign language and computer skills courses.

Meet Employees’ Learning Needs while Developing Overseas Talent• As foreign language courses are not limited to physical courses, it is recommended that the subsidy is expanded to

online courses too, as they have developed rapidly in recent years.

• As Taishin is actively expanding overseas, the scope of subsidized certifications can expand to various countries with financial certifications requirement.

Responses above can tell that colleagues appreciate how the company values employee opinions.

Topic 6 Community's Participation in Friday Noon Concerts


CommunityInformation regarding Friday Noon Concerts held at the Taishin Tower

Whole year, 2014

Respond to questions of individual members of the public via telephone

The Taishin Tower’s Friday Noon Concerts are organized by the Taishin Bank Foundation for Arts and Culture, held on Friday noon bi-weekly on the second floor of the Taishin Tower. Musicians and performers of all types are invited to perform. This provides members of the community, employees, and clients with a wonderful place to relax at noon. This ongoing event is free and has taken place for nine years now.

Members of the community call us to inquire if they need to register or any fee charge about the concert. After informed this concert is free without registration, Taishin has also noticed that members of community, Taishin’s clients and the employees participate actively when concert performs on Friday noon.

The responses above show that Tasihin will be able to interact with the public via music exchange and members of community can also join the free concerts held by Taishin.

17

2014 Performance

Highlight

I.Business HighlightsII.Corporate Governance and CSR Performance

III.Legal Compliance/Risk Management/Internal AuditIV.Supplier Management Mechanism

V.Environmental Protection MeasuresVI.Membership in Associations

18

CSR Focuses

Corporate Governance▲

• Set Corporate Governance Principles

• Set Ethical Management Best Practice Principles

CSR▲

• Established the Corporate Social Responsibility Committee

• Set Corporate Social Best Practice Principles

Supplier Management▲

• Set Supplier Management Guidelines

Corporate Governance and CSR Implementation Results• Included in the Taiwan Stock Exchange’s Taiwan

High Compensation 100 Index • Presented with a silver prize in the financial industry

for the Taiwan Top 50 Corporate Sustainability Report Awards by the Taiwan Institute for Sustainable Energy

• Won The Asset’s gold award for Excellence in Management and Corporate Governance Awards

• Ranked top 5% of the listed companies in the 1st Annual Corporate Governance Evaluation

1

18

• Ranked No.5 bookrunner on the syndicated loans arranged

• 15% growth on Loan balance for credit business

• Outstanding loans grew by 47% for micro-enterprises

• NT$90.8billion lending to small and medium enterprises

• Direct deposit accounts grew by16%

Taishin’s Annual Business

Performance

Wholesale Banking Services

Subsidiaries

Retail Banking Business

• Wealth Management• Annual membership growth of 12%

• 18% annual growth for Assets Under Management (AUM)

For members’ AUM at NT$3 million or above

• Credit Cards• Cards in circulation held a market share of

9.4%

• Number of active cards grew by 11.1%

• Number of New cards issued grew by 7.0%

• Number of merchants occupied 20.7% of market share, ranked No.2 in the market

• Car Loan Business• Car loan market share: 26.5%, No.1 in

terms of market share

• Trust Services• Collective Investment Trust Accounts

ranked No. 2 in industry

1

• Taishin Securities• Underwriting balance grew by 30%• Number of cases as lead underwriter grew by 24%• Financing balance grew by 85% at the end of the year for

the brokerage

• Taishin Securities Investment Advisory• Fund sales grew by 59%

• Taishin Securities Investment Trust• FUM reached NT$68.495 billion

• Taishin Holdings Insurance Brokers• Revenue grew by 30%

• Taishin Insurance Agency• Grassroots financial channels (farmers’ organizations and

credit cooperatives) grew by 15% of contract number

• Taishin Financial Leasing (Nanjing) • Revenue grew significantly by 750%

• Taishin Financial Leasing (Tianjin)• Revenue grew by 170%

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2014 Performance Highlight ｜ 2014 Corporate Social Responsibility Report

Taishin Financial Holdings• Excellence in Management and Corporate Governance Awards - Gold Prize• Taiwan Top 50 Corporate Sustainability Report Awards - Financial Industry - Silver Prize

Taishin Bank• Domestic Retail Bank of the Year - Taiwan .• Excellence in Mobile Banking • Best Affinity Co-Branded Card Programme of the Year • Best Mortgage and Home Loans Product Initiative • Best Card Benefits Programme of the Year• Best Mobile Banking Platform - Taiwan • Wealth Management Best Product Award• Online Banking Initiative of the Year - Taiwan • Best Customer Relationship Management in Taiwan• Highly Commended Outstanding Private Bank Asia Pacific • Best Cloud Based Project in Taiwan• Best Private Bank in Taiwan• Website of the Year - Taiwan • Nominated on Best Human Resources Development Award • Ranked “Best Corporate Social Responsibility”, “Best Corporate Governance”, and “Best Managed Company”

Securities• Golden Laureate Award (3rd place, recommended counsel)

Investment Trust Taishin High Dividend Yield Balanced Fund• 17th TFF-Bloomberg Best Fund Award – Taiwan Balanced/General Stock, 3 year/5 year• Lipper Taiwan Fund Award – Taiwan Balanced/Hybrid, 3 year/5 year

• Smart Taiwan Fund Award (with technical guidance from Morningstar) – Taiwan Balance Award

Taishin Mainstream Fund• Lipper Taiwan Fund Awards – Taiwan Equity, 5 year

Taishin China Equity Fund• 17th TFF-Bloomberg Best Fund Award – Overseas/Greater China Stock, 3 year

Investment Consulting Jupiter Global Managed Fund• Lipper Taiwan Fund Awards – Equity Global 10 year Award

Jupiter Ecology Fund• Smart Taiwan Fund Awards (with technical guidance from Morningstar), Environment, Ecology, and Alternative Energy Stock Award

Insurance Agency• 16th FHL Distinguished Profession Award, First place as Best Insurance Communication Location for life insurance, Insurance Agent, Broker & Intermediary• 3rd Annual Insurance Dragon and Phoenix Awards, Excellence Award

Subsidiaries

Outstanding Testaments


19

20

Financial Performance

For 2014, Taishin’s earnings per share was NT$0.08. Consolidated net earnings reached NT$ 9.648 billion, with NT$1.624 billion in net earnings for Taishin shareholders. Our sound capital structure is built under 122.70% of the Capital Adequacy Ratio, and 21.5% of the debt/equity ratio at the end of 2014. For detailed information, please visit the Market Observation Post System or the official Taishin Financial Holding website for the 2014 Annual Report.

2014 2013 2012

Net Income after tax – Consolidated (NT$billion) 9.648 20.574 16.871

Net Income after tax – Attributable to shareholders of Taishin (NT$billion) 1.624 13.836 10.387

Earnings per share (EPS) (NT$) 0.08 1.57 1.10Return on common shareholders' equity (ROE) 0.73% 14.19% 11.15%

Book value per common share (NT$) 11.21 12.81 12.48

Capital adequacy ratio (CAR) 122.70% 127.87% 140.74%

Debt/equity ratio 21.5% 23.4% 24.2%

Note: Above were prepared in accordance with IFRSs, except for the capital adequacy ratio of 2012, which were based on ROC GAAP.

Note: The above percentages were calculated on using the equity methed to recognize income from Chang Hwa Bank (and categorized as

“other” business) and excluding the NT$14.776 billion in losses incurred from loss of control over Chang Hwa Bank in 2014.

Business Category

(Proportion of net profit)

Bank 83.4%

Insurance brokerage 5.3%

Securities 1.4%

Other 9.9%

I.Business HighlightsIn 2014, Taishin focused on business growth and the implementation of corporate social responsibility, coming to the deep awareness that sustainable corporate growth must be constructed on the basis of steady profitability and enhanced operational performance. Taishin’s commitment towards corporate sustainability has won market recognition through understanding customer needs, continuously upgrading product functionality, and providing quality services. Taishin will work even harder towards implementing corporate social responsibility in all aspects, creating a CSR management mechanism and establishing guidelines related to corporate social responsibility, Corporate Governance, and more. This has won us the recognition of various CSR related awards. Our continuing dedication and commitment enables us to implement and execute sustainable operations in the most steadfast manner possible.

Taishin Financial Holdings’ Financial Performance

21


Business Expansion Plans

Taishin Financial Holdings’ business scope encompasses banking securities, venture capital, investment trusts, investment consultancy, insurance brokerage, and more. Improvements to our products and services in 2014 led to growth in all business aspects, which also conveys the trust and recognition towards Taishin for our customers. In addition, Taishin Bank has actively expanded into markets overseas. In addition to establishing a branch in Singapore in June, 2014, a branch in Brisbane, Australia is expected

to open in 2015 as an effort to accelerate regional arrangements. The branch in Tokyo is also expected to open in 2016. A representative office in Myanmar is also planned for the future, after assessment of Myanmar’s political-economic environment, financial overview, and trade between Taiwan and Myanmar. This will facilitate a deeper understanding of the local financial environment and development opportunities.

2005 2014 2015 2016 2017~

• 98 domestic branches• 2 overseas branches• 1 overseas representative office• 6 financial leasing offices

Up to 2014.12.31

VietnamHo Chi Minh City Representative Office

(Planned) AustraliaBrisbane Branch

(Planned) JapanTokyo Branch

(Planned) Vietnam Long An Branch

(Planned) Myanmar Representative Office

Singapore Branch2003Hong Kong Branch

22

II.Corporate Governance and CSR Performance

Corporate Governance Structure and Operation

In terms of implementing corporate governance, Taishin has established corporate governance structure, relevant company policies and management rules according to related legislation and regulations from competent authorities. Under the supervision of the Board of Directors, various committees such as the Remuneration Committee, Policy Committee, Asset & Liabi l i ty Management Committee, CRM Committee, Investor Relationship Committee, Risk Management Committee, Staff Conduct Review and Staff Performance Appraisal Committee are

doing reviews and supervisions for all facets of operation within the company to strengthen the corporate governance structure. Due to the emerging demand, Taishin initiated the Corporate Social Responsibi l i ty Committee in September of 2014, which directly report to Taishin FHC’s president. The updated company organizational structure chart is as shown above.

In addition, the number of independent director seats will be increased in near future to strengthen the Board of Directors’ independence, functionality, and enhance its operational efficiency. Establishment of the Audit Committee is expected to announce before the end of 2015.

Taishin has continued to implement various corporate governance and corporate sustainability projects throughout 2014. In addition to carrying out Corporate Governance Evaluation system self-assessment as competent authorities have required, Taishin has gone further by reviewing corporate governance structure and establishing corporate sustainability development mechanisms. The hope is to grow in line with pioneering corporations and world trends through fortifying corporate governance and implementing sustainable development plans. This will also provide stakeholders with more transparent information regarding operations.

In terms of strengthening corporate governance, Taishin established both Corporate Governance Principles and the Ethical Management Best Practice Principles in 2014. For the CSR development planning, we completed our first social responsibility report, which was assured by an independent third party. In addition, the Company also established a Corporate Social Responsibility Committee, set the Corporate Social Responsibility Best Practice Principles. Moreover, Taishin also created a CSR page on our company website, as well as actively promoted sustainable corporate operations.

Shareholders’ Meeting

Board of Directors

Chairman

President

Secretariat Division

Supervisor

Remuneration Committee

Policy Committee

Corporate Social Responsibility Committee

Asset & Liability Management Committee

CRM Committee

Investor Relationship Committee

Risk Management Committee

Staff Conduct Review and Staff PerformanceAppraisal Committee

Audit Division

WholesaleBankingGroup

RetailBankingGroup

ChiefInformation Office

ChiefAccounting

OfficeChief Risk

Office

ChiefFinanceOffice

ChiefStrategy

Office

ChiefEconomist

Office

CorporatePlanningDivision

Processing& ServiceDivision

Administra-tion

Division

HumanResources

Division

LegalDivision

ComplianceDivision

CorporateCommunication

Department

23


The Company’s Chairman is not concurrently holding the position of its CEO. There are a total of 12 directors and supervisors, including 2 independent director seats. Directors and supervisors are not chosen based upon gender or age, but professional knowledge. All current directors and supervisors are male, with an average age over 50 years. They are elite members of the finance, industry, and academic fields. Six members are with the doctorate degrees, and three hold master’s degrees across professional fields such as business management, physics, engineering, marketing, chemistry, accounting, and public administration. In addition to actively hiring outstanding members of various industries as directors and supervisors, the Company also emphasizes the development and training of its supervisors and directors. The courses with director and supervisor participation in 2014 included Analysis and Reponses to the Combination of Real Estate and Land Tax, corporate governance and Securities Regulations, etc.

In terms of operational suggestions, Taishin also hopes to incorporate suggestions from various perspectives.

In addit ion to shareholders being able to submit suggestions to Taishin FHC and its subsidiaries at any time, shareholders who hold at least 1% stake can propose issues for the annual shareholders’ meeting for approval by the Board of Directors. Employees can also utilize employee communication channels (employee engagement survey, Taishin morning conference, and employee opinions mailbox) to voice opinions directed at responsible units. Depending on necessity, responsible divisions may submit this information to the Board of Directors for discussion.

In terms of avoiding conflicts of interest on directors, proposals which pose a conflict of interest for themselves or the businesses they represent requires clarification on the nature of this conflict of interest. If there is concern over potential damage to the Company, the director is requested to recuse himself from discussion and votes. Key points of this conflict of interest and steps taken to avoid it are noted in the meeting minutes.

Dimensions of Sustainability Committee Committee Responsibilities

Social Remuneration Committee

The Remuneration Committee shall exercise the care of a prudent manager to fulfill the following duties, and offer recommendations for discussion by the board of directors:• To establish and conduct regular review of the policies, systems, standards, and structures for

performance appraisal and remuneration of the Company’s directors, supervisors and managers• To conduct regular review and determine the remuneration of directors, supervisors and managers

Economic

Policy Committee • To conduct regular review of the performance of all business units• To discuss operating strategies for all business units

Asset & Liability Management Committee

• To develop policies for liquidity and interest rate risk management• To monitor liquidity and interest rate risks, and determine appropriate strategies• To develop contingency funding plan to ensure timely funding allocation during liquidity crisis

CRM Committee• To determine strategies and goals for the data warehouse system of the Taishin FHC• To develop customer relationship strategies, and to control and co-ordinate their implementation• To set targets and track performance on cross-selling within the Company

Investor Relationship Committee

• To consolidate internal information and coordinate across subsidiaries and departments, to ensure consistency of messages in external communications

• To keep abreast of the latest market developments and the views of institutional investors• To monitor foreign shareholding ratios among industry peers as well as share price movements and

market positions

General Risk Management Committee

• Review of the risk management policy and procedure of the financial holding company • Ratification of the policies, procedures and guidelines regarding market risk, credit risk and

operational risk of subsidiaries• Supervising and establish market risk, credit risk, and operating risk mechanism• Reviewing performance report of the risk management units of subsidiaries and the overall risk

analytical report of the financial holding company • Reviewing and finalizing risk model, risk parameters and indicators, and stress test plan• The committee oversees a new product management committee, responsible for reviewing risks

involving new products and complicated trading of subsidiaries’ trading units• Monitoring various risks undertaken by the company, adopting necessary measures for controlling

large risk exposure• Report of other risk related projects• Execution of risk management related resolutions of the board

Social

Staff Conduct Review and Staff Performance Appraisal Committee

• To review employee promotion and discipline cases according to Company regulations• To review appeals of employee discipline cases• To review cases assigned by the CEO

GeneralCorporate Social Responsibility Committee

• Set corporate social responsibility policies and overall goals to ensure that corporate governance, customer care, environmental protection, social welfare are all developed according to business strategies while abiding by legal regulations

• Approve annual CSR development plans and related proposals• Approve all CSR proposals, execution progress, and annual results• Approve the Corporate Social Responsibility Report

24

CSR Organization and Operation Mechanism

Taishin is well aware that the key to promote corporate social responsibility definitely lies in the systematic developments and execution. When the Company’s first Corporate Social Responsibility Report was announced in 2014, we then initiated the Corporate Social Responsibility Committee in the same year. Through establishing and

announcing the Corporate Social Responsibility Best Practice Principles, all colleagues are able to abide by and realize the Company’s commitment towards the CSR development. The CSR related plans which Taishin executed in 2014 are shown in the chart below:

CSR Projects Contents

Published the first Corporate Social Responsibility Report

Published the first Corporate Social Responsibility report to provide stakeholders with more transparent operational information. Taishin also won silver prize in the Corporate Sustainability Report Awards.

Established the Corporate Social Responsibility Committee

Established corporate sustainability operation and implementation related mechanisms, consolidating the group’s resources for more systematic implementation.

Established Corporate Social Responsibility Best Practice Principles

Conveyed how Taishin values corporate social responsibility and our commitment through establishing Corporate Social Responsibility guidelines. Internal advocacy is implemented within the corporation to encourage implementation by all colleagues.

Established Corporate Social Responsibility area on official website

Provided stakeholders with information relating to all aspects of CSR, encouraging more stakeholders to voice their opinions and feedback.

Abided by the Equator Principles –take corporate social responsibility into account when performing credit evaluation

In May of 2014, Taishin Bank made the announcement for all sales/credit review units to conduct KYC procedures for credit accounts based upon the following credit assessment factors, while taking the implementation of corporate sustainability into consideration: ● Evaluate whether or not the credit account fulfills environmental

protection, honest operations, and social responsibilities while handling project financing cases.

● Take into consideration whether or not the credit account has experienced events of failing to fulfill social responsibility in recent years(environmental pollution, food safety, labor dispute) when offering credit line to the corporations.

● Cautiously evaluate whether or not the industry type of the credit account has serious negative impacts on the environment or corporate sustainability developments.

In the future, more sound measures wil l be planned for the environmental and social aspects of financial products or services, by complying with authority rules, association regulations, and bank policies.

Plans for implementing ISO 50001 and advocating CDP

In according with sustainability trends, current preparations for CDP signing and introduction of the ISO 50001 energy management system are now underway.

2014 CSR Implementations

25


Executive Committee Member

(wholesale banking)


(retail banking)


(subsidiaries)


(foundation)

Executive secretary


(supporting units)

ChairpersonPresident of Taishin FHC

Committee members (divisions and subsidiary representatives)

Corporate Social Responsibility Committee

Fundamentals for the Corporate Social Responsibility Best Practice PrinciplesTaishin Financial Holding’s Corporate Social Responsibility Best Practice Principles were made in 2014 and announced on the Company’s website, in the investor relations section (http://www.taishinholdings.com.tw/english/Investors/Investors_11_2.jsp)

Chapter Chapter Information

Chapter 1 General Principles Regulate the applicable scope and subjects of the principles, as well as the implementing corporate social responsibility

Chapter 2 Exercise to promote Corporate Governance

Regulates the responsibilities at the company’s executive level, as well as methods of promoting corporate social responsibility

Chapter 3 Fostering a Sustainable Environment

Regulate the responsibilities and standards that the company must uphold the issues for the ecological and environmental protection

Chapter 4 Preserving Public Welfare Regulate the company’s responsibilities and standards regarding labor, human rights, local communities, consumer protection, products and services and other issues

Chapter 5 Enhancing Disclosure of CSR Information

Regulate the disclosure standards for the company’s corporate social responsibility implementation efforts and results

Chapter 6 Supplementary Provisions Regulate the administrative standards for amendments, approvals, and announcements of the principles

Investor Relations

In order to strengthen close interactions between Taishin and global investors, to develop effective communication, to integrate financial and key information, and to enhance the transparency of the information disclosed, the investor relations department provides investors with the best services to fulfill their informational needs.

Taishin not only releases its performance results through monthly reports, quarterly analyst meetings, and annual shareholders meetings, but also attends local and overseas investment conferences and roadshows to deliver the Company’s latest business and financial results. In 2014, the Company organized and participated in seven roadshows and investment conferences in Asia, Europe, and America.

The Company’s website includes an investor relations section in both Chinese and English, where investors can easily access news updates, shareholder services, financial data, analyst meeting information, financial statements, and annual reports. Investors may also contact directly with the Investor Relations Department or its spokesperson for any data inquiries. Our committed and responsible attitude has won the recognition from many foreign shareholders, resulting in steady growth of FINI ownership in recent years. At the end of 2014, the percentage of shared held by foreign investors was 33.41%

26

Legal ComplianceThe Company has established a Legal Compliance System according to the Implementation Rules of Internal Audit and Internal Control System of Financial Holding Companies and Banking Industries announced on August 8th, 2014 by the Financial Supervisory Commission. At the same time, the Legal Compliance System Plan of Execution and Legal Compliance System Implementation Guidelines were also established to construct a comprehensive second line of defense within the company’s internal control system.The Company has established the Legal Compliance Div is ion, which is responsib le for the p lanning, management, and execution of legal compliance systems within legal compliance units. The division chief serves as the legal compliance supervisor for the general organization.Key tasks for the Company’s Legal Compliance Division are as follows:

III.Legal Compliance/Risk Management/Internal Auditing

▇ Establish a system for clear and adequate conveyance, consultation, coordination and communication of rules and regulations

▇ Issue statements for new product and new business applications, which meet legal regulations

▇ Comfirm timely updates for all regulations to ensure legal compliance

▇ Carry out legal compliance education and training ▇ Oversee the regularly compliance self-evaluation ▇ Draft annual legal compliance execution plan ▇ Assess the implementation of legal compliance

In 2014, in order to ensure employees understand and implement regulations, the Company organized the related legal compliance and outreach courses as shown in the chart below:

2014 Legal Compliance Related Courses

No. Name of training coursesTotal

trained staff

1 Financial Consumer Protection Act

30,835

2 Wholesale Finance Credit Case Studies

3 Introduction of the Volcker Rule

4 Legal Concepts and Practice Discussion

5 Information for Filling out the Financial Transaction Master Agreement

6 Guarantee and Real Security Law related Issues

7 2014 Legal Propaganda Course

8Introduction of Derivatives Transaction Regulations & Introduction of Internal Bank Regulations and Transaction Documents

9 Introduction and Discussion of Financial Regulations

10 Introduction of Financial Regulations

11 Money Laundering Control Act

12 Introduction of the U.S. Foreign Account Tax Compliance Act (FATCA)

13 Response Procedure to Personal Information Infringement Incidents

In 2014, the Company implemented the following legal compliance projects to meet legal and competent authorities’ demands.

2014 Legal Compliance Related Projects

U.S. Foreign Account Tax Compliance Act (FATCA)

Taishin’s FATCA compliance procedure management regulations were established in compliance with the U.S. FATCA to ensure all personnel understand and execute proper protocol, including identification, due diligence, reporting, withholding, and compliance checks.

The Company has hired external consultants on a project basis, to establish various measures in response to the FATCA, including inspection of amendments to data and forms, adjusting regulations, establishing systems, etc. And external consultant also provided assistance in holding various educational and training sessions to advocate implementation of FATCA related regulations amongst staff.

Planning health issue advocacy and related health management platforms

With the official launch of the Occupational Safety and Health Act on July 3rd, 2014, full-time nurse staff was hired to carry out health issue advocacy and planning of health management platforms. Medical specialists were also contracted to provide employees with occupational health consultancy services and suggestions for improvement within the work space. The aim is to improve the health of Taishin employees and the standards of occupational safety.

Adjust various personnel regulations and systems in a timely manner, according to

legal regulations

In response to amendments and announcements regarding the newest labor related laws such as the Act for Worker Protection of Mass Redundancy and Act of Gender Equality in Employment, the Sexual Harassment Prevention Measures, Reporting, and Disciplinary Guidelines were amended to clearly include interns, technical students, and temporary staff members in its scope. We abide stringently by legal regulations, adjusting related internal HR protocols and systems including increasing wages of hourly employees according to wage increases, adding paid menstrual leave, prenatal checkup leave, paternity leave, relaxing conditions for application of unpaid parental leave, the application period of paternity leave, etc.

27


Major penalties imposed by competent authorities, corrections and related improvements as indicated in the chart below:

Improvements made after major penalties in 2014

Penalty Contents Penalty Amount Improvements

Taishin Bank was not properly protect customers’ interests whi le carrying out the sales of f inancial products by not establishing appropriate risk management mechanisms and not implementing items such as KYC and KYP implementation. The Financial Supervisory Commission determined this to be in violation of Article 45-1 of the “Banking Act”, levied a fine of NT$4 million according to Article 129 of the same law. In addition, according to Article 61-1 of the same law, the Bank was instructed to correct this finding.

NT$ 4 million

Taishin has inspected and amended overal l operational procedures according to the self-discipline regulations amended by the Bankers Association, regarding the reward system, product concentration risk control mechanism, risk disclosure items, know-your-customer (KYC) procedures, complex financial product approval mechanism and more. Improvements have been noted in the Taishin Chief Financial Management Team’s Letter No. 10300004522 on July 21st, 2014, submitted to the Financial Supervisory Commission’s Banking Bureau. On August 4th, 2014, the Banking Bureau approved the improvement measures reported.

Risk Management

Proactive identification and assertive improvement of risks has always been one of Taishin’s business focuses. In addition to carrying out existing risk control structures and procedures in 2014, preventive and responsive measures are implemented to mitigate the impact on identified possible risks.

Three lines of defense in risk management

Taishin’s risk management architecture is comprised of a "three lines of defense" system, which is known internationally as the best practice of risk management for ensuring effectively execution of risk management mechanisms.

Board of Directors

Senior Management

Second Line of Defense▲

Risk management unit

Independently manage and monitor risk

First Line of Defense▲

Risk taken unit(Business units)

Adhere to risk management

rules, put in place risk control

Third Line of Defense▲

Auditing unit

Establish auditing standards and execute

independent audits and inspections

Regular reporting of risk m

anagement inform

ation

28

Chairman

PresidentAsset and Liability

Management Committee

President

Bank Credit Asset Committee

Bank Credit Approval Committee


New Product Management Committee

Chief Risk Office Chief Risk Officer

Bank's Retail Banking Finance Credit Management Division

Bank's Risk Management

Division

Securities' Risk Management

Division

Taishin Financial Holding

Subsidiary C

ompanies

Board of Directors

Bank's Wholesale Banking Credit

Management Division

Bank's Retail BankingAsset Management

Division

Organization and Responsibilities

29


Risk Management Improvement Measures

2014 Risk Management Improvement MeasuresItem Improvement Contents

Liquidity risk

In order to strengthen the Bank’s ability to manage liquidity risk, an internal Liquidity Ratio limit was implemented to monitor whether the Bank has enough qualified liquid assets to cover 30 days of net cash outflow. At the same time, the Bank must fulfill the supervisory requirements as specified by the Basel Committee on Banking Supervision.

Establishing early warning indicators

Under the Bank’s “Contingency Funding Plan”, meaningful internal and external early warning indicators are selected to determine whether the emergency response measures should be launched.

Future events and crisis prevention mechanisms

The “Future Events and Crisis Prevention Project” is processed with Taiwan Association for Strategic Stimulation (TASS) to strengthen Taishin’s crisis management and achieve the following purposes: • establishing crisis management SOP and future events chart of 5 years;• establishing crisis prevention mechanisms, strategic planning and the road map of

future;• handling crises in efficient manner and time whenever they occurred;• negotiation with media and customers when major events take place;• utilizing above tools and skills for cases analysis as references for decision making.

Board of Directors

Chief Risk Officer (CRO)


Chief Risk Office

Risk management units of the subsidiaries

• Provide risk management-related information

• Implementing the financial holding company’s risk management policy

• Approve risk management policy and procedure• Approve limits of market risks, credit risks, and operational risks of the

financial holding company

• Please refer to the P.23 Corporate Governance Section for responsibilities of the various committees under Taishin Financial Holdings

• Implementing risk management strategy and instituting risk management framework approved by the board

• Supervising Chief Risk Office and risk management units of subsidiaries in executing related policy

• Assuring effective cross department communication and coordinate risk management functions. • Formulation and institution of risk management mechanism

• Disclosure of risk management implementation• Producing overall risk analytical report for the financial holding company• Coordination and contact for risk management affairs with subsidiaries• Instituting integrated risk management information system• Introducing the risk management norm of Basel II Capital Accord, so as

to institute a risk management mechanism complying with international standards.

30

Internal Audit

Internal auditing is an integral mechanism when it comes to regular operations within a corporation. Taishin’s internal auditing mechanisms are implemented according to the Implementation Rules of Internal Audit and Internal Control System of Financial Holding Companies and Banking Industries as published by the Financial Supervisory Commission.

Taishin’s Internal Auditing implementation procedures are indicated in the chart below:

Responsibilities of the Audit Division Current Status

Management over subsidiaries

• Subsidiaries’ financial statements and internal audit reports are reviewed on a monthly basis.• An audit manager meeting for parent and subsidiary companies is convened every two months to

share information on the latest regulations, internal policies, and issues those subsidiaries should co-operate on. Meeting attendees include representatives from the Compliance Division, Chief Risk Office, other management department, and management representatives of subsidiaries with no audit unit.

• The Audit Division pays quarterly visits to subsidiaries’ audit divisions for the purpose of enhancing audit practices.

• The Audit Division performs a quarterly review of board meeting minutes submitted by each subsidiary, in order to monitor financial and business performance.

• Annual audit plans of subsidiaries are submitted for review by the Audit Division before approval by the respective boards of directors.

Supervision of internal control self-auditing

• The Audit Division supervises training courses for the business units on how to execute internal control self-auditing.

• The Audit Division ensures that each unit within the Company and every subsidiary completes internal control self-auditing and issues a Statement on Internal Control. The Chief Risk Office then arranges to have the Compliance Officer, the Chief Auditor, the President and the Chairman sign off on Taishin’s Statement on Internal Control, and submit it to the Board for approval. This Statement on Internal Control has been filed with the competent authority and disclosed in the Company’s annual report and on the Company’s website.

Performance appraisal of subsidiaries’internal audits

• The Audit Division conducts appraisals on subsidiaries’ internal audit efforts and reports to the Board of the Company; these results are then sent to the boards of the respective subsidiaries for reference in personnel appraisals

Co-ordination of inspections by financial supervisory authorities

• During inspection by the competent authority, the Audit Division serves as a contact window to assist in retrieval of information and co-ordinates communication between units under inspection and inspectors

Tracking and management

of discrepancies

• The Audit Division conducts two audits annually over Taishin and its subsidiaries.• The Audit Division tracks any opinions raised by the competent authority during its inspections,

and supervises to ensure that improvements are made.• Each quarter, the Audit Division reports to the Board of Directors on: opinions raised by

the authority during inspection and improvements made in the current period, any high-risk discrepancies identified by Taishin and its subsidiaries in their internal audit reports, effective suggestions and their implementation, any penalties imposed against Group members, and occurrence of major incidents and response actions.

Filing and Reporting

• The Audit Division has completed regular online submission of the Company’s annual audit plans, execution status, auditors list, and internal audit reports, as per applicable regulations.

• Subsidiaries are required to report to the holding company according to the “Taishin Financial Holdings’ Subsidiary Reporting Policy,” and it is the Audit Division’s responsibility to assess the importance of reports made and to decide whether to submit them to the President, independent directors, the Chairman, the Board of Directors or Supervisors.

Consultation on business

policies and operation

guidelines

• In addition to conducting audits and reviews, the Audit Division also provides opinions to audit units of subsidiaries when they modify their operating procedures, in order to prevent any attendant issues

31


IV.Supplier Management MechanismTo develop corporate sustainability, it is essential to integrate with business partners, both in upstream and downstream in the industry. In order to reach the goal, Taishin has gradually implemented sustainability practices of supply chain management. Taishin Bank has always abided by the Purchasing and Supplier Maintenance Management Procedure Guidelines when it comes to supplier selection, delivery inspection, and follow-up assessments. We have established related procedures and mechanisms in hopes to work with corporations with outstanding product or service quality amongst legally qualified vendors. In addition, we conduct surveys on vendor product/service satisfaction monthly, evaluating product/service quality, completion/delivery timeliness, service attitude, demands met, and overall service as a method of implementing supplier management operations.

In 2014, the Supplier Management Guidelines were established according to our company’s Best Practices Guidelines and Corporate Social Responsibility Guidelines. The guidelines were announced in December of the same year, to assess how suppliers value society and the environment, and work jointly to enhance and implement their commitment to fulfill corporate social responsibility. The Supplier Management Guidelines is comprised of five main evaluation criteria:

1.Localization Prioritize local suppliers to avoid excessive transportation and consumption of resources.

2.Labor assessmentAssess whether or not suppliers abide by the Labor Standards Act and related regulations, such as prohibiting use of child labor, no forced labor, providing employees with legal hours and compensation, non-discrimination, freedom of association and the right to collective bargaining. Also, if the suppliers have established regulations addressing health and safety issues.

3.Impact assessment Assess the supplier’s impact on the society and environment.

4.Code of ethics Assess the supplier’s ethical performance, including avoidance of unlawful profits, open disclosure, abiding by intellectual property rights, fair trade and confidentiality mechanisms.

5.Risk management Assess the supplier’s management mechanisms and performance on issues such as trade secrets, information security, product manufacturing, and transportation safety.

In addition to managing suppliers through the five main assessment criteria listed above, more supplier and vendor selection mechanisms are planned for the future, to fortify the environmental protection, human rights issues, labor safety, and personnel protection standards which key suppliers uphold.

In 2014, Taishin has business with a total of 168 major suppliers over four main categories: IT, construction, service, and others.

[Construction] A total of 44 suppliers,

including building renovation,

maintenance, etc.

[Service] A total of 20 suppliers including cleaning & maintenance, and courier, temporary

labor.. etc.

[IT] A total of 40 suppliers, including

telecommunication networks, computers, automated

equipment, and business machines

[Others] A total of 64 suppliers

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Green IT Data CenterIn 2014, the Neihu Building began construction to expand the IT data center. It took approximately 1.5 years from planning, construction, to completion. As electricity usage is a main source of greenhouse gas emissions, Taishin tends to purchase the green equipment and green building materials to minimize energy consumption.

V.Environmental Protection MeasuresThough operations in the financial industry may have less impact on the environment in comparison with other industries, Taishin FHC still viewed environmental issues with utmost importance. Issues such as resource utilization, energy conservation, carbon emissions reduction, the Carbon Disclosure Initiative and Green IT Data Center are all being resolved individually. The importance of environmental protection is continually being promoted at all of our company’s office buildings and branches throughout Taiwan, encouraging everyone to implement energy and water conserving measures into their daily lives. At the same time, we planned to take part in international initiatives as Taishin Financial Holding so that we can devote our efforts and influences into the mitigation of climate change.

▇ Modular UPS: This UPS increases according to actual capacity needed so that energy is not wasted

▇ EC/FAN air conditioner: Utilizes a sinking fan instead of a traditional belt type fan to enhance operation efficiency

▇ Variable-frequency, flooded air conditioning units ▇ High-efficiency transformer: A high voltage transformer

with the high efficiency figure of 0.98 is used ▇ Utilizing green building materials in ceilings, etc. ▇ As the Neihu Building is a glass curtain wall building,

the glass where the data center is located has been sealed off with thermal insulating boards to insulate against the sun’s rays

▇ 11 virtual servers added to the data center, for a total of 254 servers installed. This minimizes the need for space and energy consumption within the data center

Environmental protection measures

Carbon Disclosure

Project

Resource Optimization

Energy Conservation and Carbon

reduction

Green IT Data Center

• Implement the carbon disclosure initiative• Plan carbon disclosure survey and responses

• Use of green equipment during data center expansion

• Reduce the data center’s need for space and energy consumption

• Iron and aluminum cans recycled• Hard drives recycled• Paper recycled

• Enhance operational efficiency by 20-30%

• Reduce power usage by 10-15%

• Reduce power usage approximately 34,176 kWh

• Reduce CO2 emissions by 17.84 metric tons

• Lead-in ISO50001

Variable-frequency, flooded air conditioning units

EC/FAN air conditionerHigh-efficiency transformerModular UPSVirtual serversGreen building materialsThermal insulating boards

33


Energy Conservation and Carbon ReductionIn order to implement energy conserving, carbon emissions reducing, and energy management policies, Taishin started planning for the ISO 50001 energy management system in 2014. In the first quarter of 2015, the ISO 50001 will begin to be implemented for the first stage in Taishin Tower and Neihu Building which have the largest number of employees. Energy conservation diagnosis and testing will be carried out for these buildings, in hopes that an energy management standard (ISO 50001 international standard) with a systematic management model will help in planning comprehensive energy strategies, establishing a cross-departmental management team, setting clear management procedures, promoting energy management training courses, and implement concrete action plans. Equipment which requires significant energy usage will be monitored, measured, and analyzed periodically. The plan is to finish these measures by 2015 and get the third party certification. The hope is to effectively improve and enhance energy utilization efficiency, implement measures to conserve energy and reduce operational costs in order to pursue sustainable corporate developments and honor our commitment towards protecting the environment.

In addit ion to these aforementioned projects, power consumption will be quantified annually in order to program subsequent energy conservation plans. As dated facilities can result in decreased performance and an increase in power consumption, the performance of old and outdated air conditioning equipment will undergo continual assessment in order to protect the environment and ensure sustainable development. After evaluation, outdated air conditioning facilities were replaced in 6 locations. Other air conditioning systems were replaced by water-cooled, air-cooled, and

multiple link variable-frequency units according to the conditions in each situation, to enhance operation efficiency by 20-30%. This saves 10-15% in power consumption, reducing total power consumption by approximately 34,176 kWh and CO2 emissions by about 17.84 metric tons.

The primary source of Taishin’s greenhouse gas emissions stems from electricity and fuel consumption for company vehicles. In 2014, Taishin had no other direct greenhouse gas emissions aside from the 85 and 5 kg refrigerant refill of R-134a and R-22 respectively for water chiller units and the total annual fuel consumption of 15,806.97 liters (approximately 37 metric tons of CO2 emissions). In order to protect the environment, the plan is to gradually replace 3500cc company vehicles with 2000cc vehicles, honoring our commitment to love the earth through concrete action.

Energy indirect greenhouse gas emissions are listed in the following chart. The annual total power usage for the Financial Holding Building was 5,925,600 kWh, approximately 3,093 metric tons in CO2 equivalent emissions. There are no carbon emissions statistics right now for employee commutes, as most utilize public transportation in the form of buses, the MRT, etc. and there is a great variance in distances travelled for each employee. In the future, Taishin will continue to self-manage and regularly assess the concrete results of energy conservation and carbon emissions reduction efforts in order to accurately assess greenhouse gas emissions and remind all colleagues to work together to cherish the environment and care for the earth.

2014 2013 2012

Staff in the building 1,325 1,296 1,240Total power usage (KWH) 5,925,600 5,674,638 6,017,700CO2 emissions(equivalent metric tons) 3,093.16 3,018.91 3,201.42Percentage of power conserved (per person) -2.14% 9.78% 8.72%Average power usage per person 4,472.15 4,378.58 4,852.98Total water usage (cubic meters) 26,578 24,562 26,081Percentage of water conserved (per person) -5.86% 9.89% 3.13%Average water usage per person 20.06 18.95 21.03

● The emissions caused by power consumption in 2014 were calculated with the 2013 electricity emission factor: 0.522 CO2e/KWH announced

by the MOFA’s Bureau of Energy in 2014.

● The percentage of power and water conserved per person is calculated in comparison to the previous year. In 2014, as various events held

at the Taishin Tower increased by 57% when compared to 2013, power and water usage became higher.

Total Power/Water Usage, and average power/ water usage per person in Taishin Tower

Taishin FHC Company-owned Vehicles Fuel Consumption

Note: The calculation of greenhouse gas emissions is a self-assessment carried out according to the operational right of control law. Emissions are

calculated in this manner: usage x emission factor (Version 6.0.1 of the EPA’s Greenhouse Gas Management Chart) x GWP value (IPCC 2nd

Assessment Report) .

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Amount of Green Purchases in the Past 3 Years

Green purchases of 2014 include: environmentally friendly toner

cartridges and recycled paper, UPS and air conditioning equipment

for Green IT Data Center

Corrected the amount of green purchases made in 2013, from what

was included in Amount of Green Purchases in the Past 3 Years on

P.75 of the 2013 Corporate Social Responsibility Report

Taishin has always taken an active role in the operation of public associations in related industries to jointly assist in improvements to the financial market. Through participation in public associations, we are able to take an appropriate part in the establishment and development of public policies.

Organization Name Membership in Associations

Taishin Bank

• Bankers Association of the R.O.C.• Pension Fund Association, R.O.C.• Trust Association of R.O.C.• The Institute of Internal Auditors, R.O.C.• International Swaps and Derivatives Association (ISDA)• Taiwan Securities Association• Member of Taiwan Depository & Clearing Corporation Fixed Income Committee• R.O.C. Bills Finance Association • Securities Investment Trust & Consulting Association of the R.O.C.

Taishin Securities • Taiwan Securities Association• Chinese National Futures Association

Taishin Venture Capital

• Taiwan Venture Capital Association• Taiwan Private Equity Association

Taishin Securities Investment Trust • Securities Investment Trust & Consulting Association of the R.O.C.

Taishin Securities Investment Advisory • Securities Investment Trust & Consulting Association of the R.O.C.

Taishin Insurance Agency • The Insurance Agency Association of the Republic of China

Taishin Holdings Insurance Brokers • Insurance Brokerage Association of Taiwan

Resources OptimizationWith the scarce resource on earth, all groups should value resources more and use them more effectively. Taishin has always hoped for sustainable utilization of resources, doing our part for the earth through gradually expanding purchases of green products and advocating reusing and recycling resources. Our green purchases have amounted to more than NT$11 million in 2014. In the future, we will continue to make green purchases while expanding promotion of waste reduction and recycling programs.

Carbon Disclosure Project (CDP)

Faced with climate change and worsening global warming, reduction of greenhouse gas emissions has become an important issue of global concern. Taishin actively promotes various environmental protection measures. This includes implementation of the “care for the earth by saving energy” philosophy, as well as active participation of the Carbon Disclosure Project, which was started by an independent, international non-profit organization. It is expected to be completed by 2015. Corporate social responsibility is fulfilled through active disclosure of greenhouse gas emissions and related carbon management information, as well as effective plans to reduce emissions. These concrete actions support energy conservation and carbon reduction efforts in the pursuit of sustainable development for the environment.

2014 Recycled VolumeRecycled Volume (KG) Neihu

BuildingTaishin Tower

PET bottles 744.45 994.39

Iron cans 374.53 235.55

Aluminum cans 106.56 70.36

Paper 1,883 781

IT equipment (Unit: per unit) 1,564

Recycled paper calculated from Oct. to Dec. 2014

Only the hard drives recycled were calculated for IT equipment

VI.Membership in Associations

1

2

1

2

1

1

2

2


I.Personal Information ProtectionII.Quality of Service

III.Optimization of Products and ServicesIV.Constantly Developing Innovative Services

35

36

The Company has achieved 80% customer satisfaction for 5 consecutive

years, particularly:

Taishin Bank is the only acquiring bank

that provides Contactless Payment Card Service.

“Pleasant voice and manner”- 95%“Efficiency in meeting customer needs” - 90%

•

• •

Service Quality

Customer Satisfaction

Innovative ServiceMobile Payment

Services

Based on the feedback of customers, the Company has implemented 125 improvement initiatives in 2014 to ensure comprehensive optimization of its service quality.

Adhering to a “people-oriented” business philosophy, Taishin endeavors to provide best-in-class services to realize its commitment to customers. In addition to its efforts in perfecting service quality, Taishin also insists on refining details of its internal operating systems and management policies.

Customer Service and Commitment｜ 2014 Corporate Social Responsibility Report

37

I.Personal Information ProtectionTaishin respects the privacy of personal information and established the “Taishin Financial Holdings - Enforcement Rules Governing the Management of Marketing Lists” in 2003, shortly after the company was established. The enforcement rules provide guidelines for the limitation and management of the usage of marketing lists, thereby protecting the interests of customers. The Company, well before the implementation of the “Personal Information Protection Act”, enforced strong controls on personal information according to the “Computer Processed Personal Data Protection Law”. In 2010, Taishin International Bank also received ISO27001 ISMS (Information Security Management System) certification, ensuring adequate protection of information systems and sensitive data.

Following the announcement of the Personal Information Protection Act in 2010, the Company further introduced the BSI BS10012:2009 Personal Information Management Standards and established a fundamental structure for personal information protection, so as to ensure compliance with relevant regulations and improve personal information security. The PDCA (Plan-Do-Check-Act) management methodology is adopted for operating the Personal Information Management System (PIMS) within the organization. Various protective measures have been incorporated into the operating procedures and information security systems to enhance the security of customers’ personal information.

Milestones in Implementing Personal Information Protection

Policies

Year Commenced Description

Introduction of the“Personal Information Protection Management System”

2011Taishin International Bank (including Hong Kong Branch), Taishin Securities Investment Trust Co., Ltd, Taishin Securities Co., Ltd, Taishin Insurance Agency Co., Ltd, Taishin Holdings Insurance Brokers Co., Ltd, Taishin Asset Management Co., Ltd and Taishin Real Estate Management Co., Ltd.

2014 Taishin Daan Finance Co., Ltd and Taishin International Bank, Singapore Branch.

Establishment and Maintenance of the “Guidelines of the Protection and Management of Personal Information

2012 The “Guidelines of the Protection and Management of Personal Information” were established. Annual reviews/revisions are conducted to ensure its effectiveness.

2014Established the “Taishin International Bank - Security Policies for Documents Involving Personal Information” to ensure proper management and security of personal information.

Compliance with and Full Implementation of the Personal Information Protection Act

2011 Organized annual training on personal information protection in the Taishin Financial Holding Co., Ltd and its subsidiaries.

2012

Bi-weekly awareness publication of Personal Information Protection: The Company issues biweekly newsletters to incorporate relevant concepts and guidelines into daily operations, underpin employees’ awareness thereof and shape the corporate culture, so as to ensure the trustworthy and excellent financial services are offered to customers.

The personal information control procedures have been incorporated into the internal audit checklist.

Continuous Improvement of Information Security Facilities

2010

The Company has been, on an ongoing basis, executing the ISO27001 ISMS (Information Security Management System) to ensure that all information systems and operations are properly protected, so as to eradicate any data damage, loss, leakage, tamper, abuse or infringement, etc. The ultimate purpose is to strengthen the confidentiality, integrity and availability of the information being processed.

Control of Campaign Lists

2003 The Company has applied an encryption mechanism in the process of producing and analyzing campaign lists within the analysis environment.

2003 All campaign lists should be transmitted through the specified channel, so as to ensure security in the transmission process.

Anyone who has any queries or comments with respect to personal information of customers is welcomed to contact branches of Taishin International Bank or call our 24h customer service line. Taishin has also established a customer feedback team to strengthen and improve the efficiency on handling of customer grievances.

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II.Quality of Service

Achievements in Promoting Quality Service ProjectsTaishin has been making long-term efforts in promoting service improvement projects. Major achievements in 2014 include:

2014 “3S Service Program Reward” to Elevate Service Passion and QualityTaishin holds an annual “3S Service Program Reward” to expedite the practice of 3S essences in daily services. Business units are encouraged to propose feasible service improvement programs. Cash rewards are offered to programs with specific and successful results. This approach helps apply the 3S essences in daily activities and to enhance teamwork results.

To encourage outstanding service staff and stimulate mutual learning, the Company also shared the stories of inspirational services on a monthly basis. Each year, employees with specific and outstanding achievements in 3S service will be qualified for the "Taishin Service Model Award" competition. Winners will be recognized at an annual award ceremony and receive commendation from the Chairman and senior management. The family members of the winners, in the meantime, will be invited to share the honorable moment. Taishin endeavors to create a service-focused working environment to engage all its employees.

Core value of

Taishin’s service

3SSincere Superior

Simple

Core Service Values (3S)Taishin applies the “3S” essences to improve its operational procedures and efficiency, and has facilitated numerous projects incorporating both innovative technology and its business values.


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VOC (Voice of Customer)Taishin takes concrete actions to demonstrate its dedication to service quality. In 2009, the Company established the VOC platform, so as to actively collect customer feedback, consolidate and analyze information and work out feasible programs for procedural or service improvements. In 2014, the Company completed a total of 125 service improvement initiatives. Other efforts made in recent years include displaying customer feedback forms in branches as to aware and understand customer opinions.

Operational OptimizationIn addition to the efforts in elevating service quality and customer satisfaction, the Company also endeavors to achieve comprehensive optimization of its internal operations, including:

2014 Major Items of Optimization

Item Description Effects of Optimization

ATMOptimization of the cash withdrawal flow The ATM function for “Speedy Cash Withdrawal” saves customer time for relevant ATM

transactions.

Reminder for ATM card activation Reminders for activating ATM cards are now sent through text message rather than manually, thereby saving manpower cost.

Credit Card

Optimization of customer enquiry services Real-time and convenient customer enquiry services are now available on Taishin’s official website for customers to check progress of credit card applications and related activities.

Authorization Approval Process This initiative reduces the accounting processing time for merchants and expedites the payment process.

Calculation of credit limit for installment Instead of manual calculation, the system now supports integrated calculation of credit limit for credit card installments, helping reduce customer waiting time and increase service efficiency.

Optimization of password-setting procedures for cash advances

After the integration process, customers need only one cash advance password for all Taishin cards. This increases the convenience of the service, reduces paper waste, and saves human efforts for mail and handling.

Simplified direct debit application process The direct debit application procedures have been simplified to reduce duplicate efforts, paper and printing costs.

Loans

Integrated quotation for the e-loan processing System (IPMS)

The quotation process for home loan and special programs have been incorporated into the Image Process Management System, leading to shortened processing time and improved drawdown efficiency.

Simplification of batched appraisal reports for home loan

The documentary requirements on batched appraisal reports were simplified to reduce report preparation time by the appraiser and sales staff, and to expedite the whole process.

Optimized personal loan credit review process through IPMS

Operational procedures have been simplified, standardized and automated to achieve better efficiency in credit review and loan drawdown.

Optimized application process for car loans Application forms are simplified to save customers’ time in filling out forms and to expedite the review process.

Simplification of the SME credit review process The SME credit review procedure has been adjusted to reduce review time.

Corporate Banking

Optimization of the export negotiation processA new function has been added to the Export Negotiation application form to link the bill of exchange, helping save the customer time in filling out the form and draft, minimize mistakes and increase convenience.

Optimization of the corporate banking credit report system

The report system has been integrated and the approval flow simplified. Information is now consolidated through the automation system which helps reduce manual work.

Others

Wealth Management Operation Model The proposal for customization of investment portfolio and asset allocation helps enhance Taishin’s wealth management service.

Optimization of system setup process for fund promotion

This initiative helps shorten the time of system setup for fee rates and the relevant promotional details, reducing costs and human error and improving service efficiency.

IPMS system optimization This initiative contributes to better risk control, reduced time for document processing, fewer operational mistakes, avoidance of loss in delivery, and less printing work.

Automation of regular information security audit for the holding company The computerized audit process reduces manpower costs for the audit.

Installation of the new Treasury Trading System A new trading system for derivative products has been implemented, which has incorporated the requirements of overseas branches to facilitate international development.

Development of new treasury application The current procedures have been simplified to minimize human error, which has significantly saved back office costs.

New sales system for structured products offered to the public

System functions and flows are integrated, taking into account the need for system development and expansion in future.

New government reporting system for Treasury Marketing Unit (TMU)

The system provides a one-in-all reporting platform and interface, which helps improve the work efficiency of relevant staff.

New function for foreign exchange calculation A new function was added to Taishin’s official website to enable online calculation of the payment/receipt amount for foreign exchange transactions.

Optimization of foreign currency application forms The application form is in both Chinese and English. This makes the form more customer-friendly and saves time for communication.

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Satisfaction Management

With respect to the quality audit on banking services, Taishin sends “mystery shoppers” from its headquarters on a monthly basis to audit branch operations. In addition to telephone checks, the mystery shoppers also visit branches in person to check the service performance of first-line staff and ask scenario-based questions to test their problem-solving abilities, aiming to optimize service quality. The Company also engages professional market surveyors to conduct customer opinion surveys on a quarterly and yearly basis. The survey covers all branch counter services, wealth management, credit cards, consumer loans, as well as electronic service channels such as internet banking and mobile banking. Survey questions cover overall banking operations as well as detailed service items.

The 2014 Taishin Bank customer satisfaction survey shows that as high as 80% of customers consider the bank’s services “satisfactory” or “extremely satisfactory”. The Bank, in fact, has achieved the same satisfaction level for five consecutive years. The survey results also show that

Inspiring Service Stories

Heartwarming Memories for Taishin Customers

One day, Ms. Chuang of the Payment Service Division received a phone call from a customer, who complained that she had been unable to receive merchant payments through her Taishin account because of an inconsistent account name. Actually, she had visited the Bank in person a few days ago to apply for an account name change. Ms. Chuang firstly pacified the customer and offered an alternative: “If you need to change the account name in future, please call me first and I will prepare the necessary documents for you. What you need to do is simply mail to the branch a copy of the passbook bearing the changed account name. This will save all a lot of trouble.” Miss Chuang then immediately prepared all the required documents and, very considerately, marked in handwriting the fields where customer input or signature is required. Before mailing the package, she also attached a short note to explain the relevant requirements, demonstrating her thoughtfulness. The service provided by Ms. Chuang was rewarded with a nice thank-you letter: “Dear Ms. Chuang, I am very pleased and grateful for the sweet service you provided. This is a good learning experience for me. Now I know there is nothing unsolvable. I love your sweet voice and smile, which reminds me what a cheerful lady you always are. Thank you very much indeed.”

Quick-witted Teller Helped Stop the Scammers

Ms. Chen, a Bank customer, received a phone call recently. Through the phone she heard the seeming cry of her son. The guy on the phone then requested Ms. Chen to withdraw her time deposit and repay him TWD800,000, the money lent to “her son” for purchasing amphetamines. The guy, in the meantime, requested her to make the transactions with accomplice in person at the near-by elementary school. He demanded Ms. Chen not switch off the phone. When Ms. Chen stepped into the branch, Ms. Chang, the bank teller, immediately felt her panic. Quickly, Ms. Chang brought pen and paper and gesticulated to the customer to write down the situation. On reading the note, she soon determined that this could be a fraud and wrote down on the paper “scam”, which she showed to the customer. The branch manager was informed at the same time. To stall for time so that the branch manager could get in touch with Ms. Chen’s son, Ms. Chang spoke near the cell phone: “Please wait for your turn to be served.” Because of the smart service, Ms. Chang and the branch manager received sincere thanks from the customer. The branch staff not only have successfully stopped the scammers, but also helped the customer secure her money.

the customer service Taishin’s staff achieved, respectively, a 95% and 90% satisfaction level in the items of “Pleasant voice and manner” and “Efficiency in meeting customer needs”. To further elevate service quality and expand service scope, the Bank established in Taichung a second customer service center in April, 2014. On the category “the time taken for connecting with a customer service clerk”, the Bank has achieved a significant improvement of 6% when compared with 2013, showcasing the bank’s efforts in improving service efficiency.


41

III.Optimization of Products and Services

ATM Service Optimization ▇ As at the end of 2014, Taishin has installed more than

2100 ATM machines in FamilyMart stores.

▇ In 2013 and 2014, Taishin installed new ATM machines with deposit function in its branches, leading to a 30% saving on average transaction time and a 15% growth in deposit transaction volume. The new speedy cash withdrawal function, furthermore, results in a 21% saving of customer’s time when compared with the regular withdrawal process.

▇ To demonstrate its concern for visually-impaired customers, Taishin installed an accessible ATM in the FamilyMart Gold Brick Shop, Taipei City, in October, 2013. Braille code instructions for the ATM are provided simultaneously. In addition to the Braille keyboard, the Bank also provides a Braille instruction manual, which is placed right beside the machine. The speed of the voice guidance, in the meantime, has been adjusted to ensure clarity of communication. All these thoughtful designs are aimed to help visually-disabled customers to independently complete transactions and achieve self-reliance. When purchasing the new ATM machine, Taishin also took into account wheelchair height, so that the ATM machine is sufficiently user-friendly to the disabled. To further expand its services to the visually-impaired, Taishin will gradually install “Voice-Guided ATM’s” in 2015 in its service locations around the island, including the Business Department (Head Office), Dunnan branch, North Kaohsiung and North Taichung branches.

▇ The customer satisfaction level for Taishin’s ATM service has been maintained at 80% or above in recent two years.

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Credit Card ServicesIn 2014, Taishin made great efforts to improve its credit card services, aiming to create a better consumer experience for its merchants and credit card holders:

No. Type Description

1 Merchants

• Ensuring comprehensiveness of merchant service products, including: skipping signatures for small transactions, e-wallets, and Mobile Point of Sale (mPOS).

• Ensure smoothness of credit card transactions, including: providing merchants with diversified payment services, proactive testing and inspection of swipe-card devices.

• Introduced CUP Chip Card transactions to provide better service to visitors from China.

2 Card Quality

• Card suppliers are required to conduct ongoing quality control to eliminate problems such as delamination, poor adhesion or malfunction of the sensing device.

• Magnetic stripe cards have been upgraded to contactless IC cards or with added Easy Card function.

• Frequency of card replacement has been reduced for the purpose of environmental care.• Better benefits are offered to meet/exceed customer expectations, in the meantime maintaining

product competitiveness in the market.

3 Management of Card-in- Force

• Efforts include: minimizing the risk of card forgery or customer complaint, improving overall percentage of active cards and reducing the cost of managing dormant cards.

4 More Convenient Enquiry Functions

• The new enquiry interface on Taishin’s official website (https://www.taishinbank.com.tw/TS/TS02/TS0201/TS020104/TS02010410/TS0201041001/index.htm#357) enables diversified enquiry services including progress of credit card application and eligibility of the Bank’s promotional programs. These functions are convenient and easily manageable, contributing to the integrity of Taishin’s customer services.

5 Credit Card Payments

• Optimization of credit card application form: New fields are added to the card application form to include parking fee payments, e-tag prepaid cards, payment of Chunghwa Telecom Bills, and credit card auto-pay services, etc.

6 e-statement• To achieve higher customer satisfaction, the new interactive mechanism for credit card

e-statements allows customers to access the online application function on a real-time basis. No phone calls waiting is required.

Testimonial by Mr. Tung, Taishin Credit Card UserI love Taishin credit cards because they offer a lot of discounts and cash rewards. The parking discounts for Dodo Home and Taiwan Parking are also very good. Now Taishin cards are my most favorable credit cards.


43

Wealth ManagementIn 2014, the Bank achieved significant growth in its wealth management business. The total number of Affluent Members and above has grown by 12% in the year. Total assets under management (AUM) also increased by 18%. To provide customized services to its customers, Taishin has completed the following optimization projects in 2014:

No. Projects/Products Optimization Initiatives/Effects

1 Wealth Management Customer Relationships Established a regular customer contact mechanism.

2 Payroll Management Project Offered customized services, information integration and direct feedback channels.

3Integrated Wealth Management Services for Corporate Customers(including DBU and OBU banking accounts)

• Streamlined the service flow for customers.• Achieved better understanding of customer needs to grasp business

opportunities and enhance Taishin’s competitiveness.• Offered additional customer benefits to win customer satisfaction and loyalty.

4 Special Program for Family Members

• Designed benefits and preferential terms to be shared by all family members, so as to create a better customer experience.

• Offered fee discounts and preferential interest rates for home loans for family members.

• The account consolidation service for family members enables relationship managers to better understand the customer’s asset portfolio and provide effective proposals.

5 Personal Preference Worksheet • Analyzing the customer's preference pattern and personal characteristics to provide customized wealth management plans to the customer.

OthersIn addition to the above initiatives, Taishin has been optimizing other products and services, including expanding the existing service scope, refining service quality and increasing customer engagement. All these demonstrate the Company’s devotion to creating the perfect customer experience.

No. Projects/Products Optimization Initiatives/Effects

1Added the function of “Specified Number” to the queue management system

The queue management system in branches now supports the function of “Specified Number” so that it is not necessary for a customer to take a new number if he/she does not show up at the counter in time.

2Streamlined the credit review process for new card application during the period of temporary credit limit adjustment

The credit review process has been expedited when an existing cardholder applies for additional credit card(s) during the period of temporary credit limit adjustment. This helps elevate customer satisfaction level.

3Upgrading the Payroll Transfer System to include inter-bank transfer transactions

The expansion of payment transfer channels helps attract high-value customer groups.

4 Birthday messages to loan customersThe system will generate lists of loan customers whose birthdays fall in the next month, enabling the relationship manager to send birthday greetings through personal calls, in the meantime collecting customer feedback and improving relationships.

Testimonial by Mr. Wei, Taishin Wealth Management Customer Taishin’s wealth management consultants are not only professional, but also dedicated. They are willing to spend time confirming the customer’s needs and providing wealth management plans for different stages of life. They also provide tax advice. The superior services are beyond my expectation.

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mPOS (Mobile Point of Sales)

Considering the trend for mobile-media consumption and market demand, Taishin has been actively promoting its mobile payment business. In 2014, Taishin obtained permission from the Financial Supervisory Commission for piloting of mPOS (mobile point of sales) business.

Advantages of mPOS Services:

(1) The Mobile Point-of-Sale (mPOS) system integrates handheld dev ices and wi re less t ransmiss ion technology. It enables the expansion of traditional credit card transactions from fixed locations to any place in Taiwan with access to the Internet.

(2) Credit card services have since been expanded to include: premium collection, door-to-door payment collection, airport pick-up, car rental (delivery at home),

short-rental tour services and house moving services.

Cardholders are able to sign directly on the mobile

device through Taishin's exclusive APP system.

(3) Information Security: mPOS systems have been

cert i f ied by international organizat ions. Personal

information of cardholders is therefore adequately

protected. mPOS provides safe and convenient payment

services to both merchants and cardholders.

Currently, Taishin Bank is the only acquiring bank providing

contactless IC card services. The service scope covers

VISA, MasterCard, JCB and CUP cards. Taishin provides

the most comprehensive service solutions in Taiwan's

mPOS market.

To keep pace with the globalization of financial services and the rise of the “Finger-tip Economy” , Taishin has been, based on its belief in "borderless services", diligently developing diversified payment services. This showcases Taishin’s efforts to meet the expectations of customers and society, and to create shared value for the company and its customers.

• Implemented "Preload Easy Card/OTA Credit Card“ with Chung Hwa Telecom.

• Received approval to launch Internet payment/collection, online opening of value-stored accoun ts , and payment /collection services for cross-border transactions.

• Launched QR Code Credit Card Services w i t h C h u n g H w a Telecom

• Completed the pilot test for issuance of the 100 "OTA Credit Card ”w i th Chung Hwa Telecom.

• Participated in the Ta i w a n M o b i l e Payment Conference and became one of the leading issuing banks.

• Launched the MasterPass,e-wallet

2014/3 2014/4 2014/10 2014/11 2014/12

New Payment Instruments Offered by Taishin

IV.Constantly Developing Innovative Services

Finger-Tip Economy – refers to the change in consumer behaviors, where the use of personal computers has been replaced by the movement of

fingertips on mobile phones, so as to perform a direct or indirect consumption transaction.

1

1

Employee Care

45

I.HiringII.Talent Development

III.Remuneration and BenefitsIV.Human Rights Protection

V.Working Environment and Labor SafetyVI.Staff Care and Activities

46

Employees are Taishin Financial Holdings’ most important asset and partner for sustainable development. Only happy employees make satisfied customers. Therefore Taishin strives to create a high-quality work environment with competitive remuneration and benefits, comprehensive training and development structure, and 2-way communication platform, so that every Taishin employee can develop their talent without worries at home. In 2014, the Taiwan Stock Exchange ranked Taishin in the top-10 of its Taiwan Top Salary 100 Index.

0 major incidents in 2014

reached 52.2 hours/

person, a new company milestone.

Remuneration & Benefits

Training and Development

In 2014, investment in training

In top-10 of

Top Salary 100 Index of the Taiwan Stock Exchange

Working Environment and

Occupational Safety

47

Employee Care ｜ 2014 Corporate Social Responsibility Report

Academia-industry CooperationAs the digital banking era (Bank 3.0) approaches, Taishin Financial Holdings makes great efforts in reaching the new generation of clients and recruits talent with various backgrounds to meet the hiring needs of each business unit. In 2014, Taishin recruited about 300 new talents by holding nearly 30 on-campus recruiting activities and seminars, also via large-scale recruitment programs such as the Management Associate (MA) Program, the ARM Development Project, and the New Hires Development Program. Through systematic cultivation and job rotations, these new talents were quickly prepared for specialized and managerial roles to meet the need for entry-level staff in response to business expansion and also the need for expatriate personnel to accommodate international expansion of the company.

In addition, the company’s Early-Win Program offers students off-campus internship opportunities to clarify their future career direction and enhance their confidence during job search. In 2014, nearly 300 student interns were recruited, and cooperation agreements with 15 universities and colleges were signed, to nurture young talent in finance, enhance students' practical and professional skills, and ensure a steady stream of talent that matches with the company’s needs.

I.Hiring

Diversified Hiring and Friendly WorkplaceBy the end of 2014, Taishin Financial Holdings and its subsidiaries employed 7,574 full-time staff, 257 part-time staff, and 88 contract staff, making a total of 7,919 employees. Of these, 4,479 employees, or 59.1%, were female, and the number of female managers was 447, or 46.6% of the total number of managers. Thus, hiring and promotion showed no gender preference.

At its overseas operations, Taishin gives priority to hiring local talent. In 2014, the total head count at its overseas operations stood at 469 employees. Of these, 77.8% were local hires, and 59% of overseas managers were local hires. In addition, in compliance with the Labor Standards Act, Taishin does not accept employment of children under the age of 16. The average age of Taishin employees is currently 36.6. To offer employment opportunities to disadvantaged groups, Taishin also hires as many employees with disabilities as required by law, and provides a friendly and barrier-free work environment as a matter of convenience and respect to everyone.

Area GenderFemale Male

Total %-30 years 31~50

years 51+ years Total -30 years 31~50 years 51+ years Total

TaiwanGeneral 941 2,845 55 3,841 623 1,643 79 2,345 6,186 87.1%

Managerial 2 402 31 435 1 389 94 484 919 12.9%Taiwan total 943 3,247 86 4,276 624 2,032 173 2,829 7,105 100.0%

OverseasGeneral 134 53 4 191 124 106 7 237 428 91.3%

Managerial 2 8 2 12 13 13 3 29 41 8.7%Overseas total 136 61 6 203 137 119 10 266 469 100.0%

Grand total 1,079 3,308 92 4,479 761 2,151 183 3,095 7,574 100.0%Percentage 24.1% 73.9% 2.1% 100.0% 24.6% 69.5% 5.9% 100.0% 100.0% 100.0%

Staffing Structure - Gender, age and Positions of Full-time Employees

Taiwan total Overseas total

• General

Female 60.2% Female 43.3%Male 39.8% Male 56.7%

• General• Managerial • Managerial

469%7,105%

62.1% 37.9% 47.3% 52.7% 44.6% 55.4%29.3%

70.7%

48

AreaFemale Male

Total %-30 years 31~50 years 51+ years Total -30 years 31~50 years 51+ years Total

Taiwan 511 373 2 886 374 293 5 672 1,558 84.8%

Overseas 101 26 2 129 110 38 3 151 280 15.2%

Total 612 399 4 1,015 484 331 8 823 1,838 100.0%

Percentage 60.3% 39.3% 0.4% 100.0% 58.8% 40.2% 1.0% 100.0% 100.0% 100.0%

AreasFemale Male

Total %-30 years 31~50 years 51+ years Total -30 years 31~50 years 51+ years Total

Turnover rate 15.8%

Taiwan 295 290 6 591 163 237 2 402 993 93.2%

Overseas 21 15 0 36 19 18 0 37 73 6.8%

Total 316 305 6 627 182 255 2 439 1,066 100.0%

Percentage 50.4% 48.6% 1.0% 100.0% 41.5% 58.1% 0.5% 100.0% 100.0% 100.0%

turnover rate = number of people resigning in the current year/average number of employees in the current year

Full-time Staff Turnover Rates by Gender and Age

Full-time New Hires by Gender and Age

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1

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Complete and Clear Career Planning In order to give each employee a clear sense of where they are in the career roadmap, Taishin draws up an Individual Development Program (IDP) for each employee annually. The IDP applies the Management by Objectives (MBO) method with reference to an employee’s target position, defines the employee’s skills gap, and specifies a suitable combination of education and training, job rotations, professional coaching, meetings, project-based learning, and on-the-job coaching by the employee’s supervisor as the best development approach. Announcements of internal job openings provide another opportunity for career development so that employees can plan their own careers flexibly.

II.Talent Development

Talent is the bedrock for sustainable development. Therefore Taishin continuously invests in all its employees and potential employees, from promising students to new hires to senior management. Taishin has a comprehensive training roadmap, innovative and diverse learning avenues, and continuously encourages its employees to learn and grow. Taishin’s talent development efforts have received attention and recognition from professional organizations, exemplified by its Bronze Award in Taiwan TrainQuali System (TTQS) in 2012, nomination for Best Human Resources Development Award from the Taiwan Academy of Banking and Finance, and the 8th National HRD InnoPrize in the same year.

Step-by-step Training of New HiresAt Taishin, training of financial talent starts on the campus. In 2014, four workplace experience programs were held, serving more than 200 students. The programs provided graduate candidates with a training and trainee experience aimed to smooth their transition into the labor market. Taishin offers comprehensive induction to new hires, including a three-day classroom-based course on general knowledge and a 3.5-hour online training course, to provide them with the basic knowledge and skills required for working in the company. In 2014, around 1,700 new hires participated in the induction programs, with an average of 68.8 hours of training per person and 118,342 training hours in total.

Career Roadmap

New Hires Training

New hires camp New hires e-community

New officers e-rules Orientation training program

Financial controller (FC)

Regional/Functional director

Branch manager

Branch operations manager

Senior checking specialist

Branch operations specialist

Senior branch operationsspecialist

Checkingspecialist

(stocks/NPC)

Senior on-air wealth management specialist (SAPB)

On-air wealth management specialist (ACB)

Financial advisor (FA)

Financial specialist (PB)

Sales manager Relationship manager (RM)

Senior financial advisor (SFA)

Senior financial specialist (SCB)

Financial specialist (CB)

50

・Steady Training ProgramTo develop the skills needed for future roles, the program establishes an MA system through structured training and development.

・MentorWith senior executives acting as mentors, employees are givenpersonalized coaching and guidance.

・Individual Development Plan

Every MA has a tailored IDP that outlines a career roadmap.

・Planned RotationThrough planned job rotations, employees can broaden theirfield of experience and then pursue specialized training.

・Strategy Conference

Employees are invited to join executive meetings and witness how decisions are made.

Talent Pool ProgramsIn addition, through application and screening, periodic 360-degree assessment, and recommendation and selection by the talent evaluation committee, employees of different levels at Taishin are given the opportunity to join various talent development programs such as those for Reserved Line Managers, Reserved Branch Managers, Management Associates (MA), and Advanced Management Associates (AMA) and the Taishin Star Program (TSP). The objective is to develop future team leaders and managers of various levels in a well-planned manner and in line with the company’s core competencies and strategic goals.

Executive

DepartmentHead

Managerial Role

Specialized RoleMA

AMA

TSP

Diversified and Balanced Autonomous LearningIn addition to internal learning resources, Taishin also encourages employees to participate in courses organized outside the company, and offers subsidies for continuing professional education and for professional ski l ls certification. To underscore the importance and necessity of self-guided learning, Taishin has introduced a “Learning Account” system where each employee is given 10,000 training points per year which they may spend freely. In 2014 more than 1,500 employees used their learning account.

Through the Taishin University learning platform, Taishin offers systematic structured learning resources to its employees to encourage “Lifelong Learning”. Modeled on the design concept and spirit of university education, this corporate academy integrates internal and external resources in order to strengthen the specialized and general skills of employees. Since 2011 to date, the platform has been browsed more than 250,000 times.

Talent Training Programs

Learning Keeps Me Continuous Self- DevelopingI really enjoy using the integrated learning platform of Taishin University, because I can easily find everything I need to learn. Everyone receives 10,000 training points (equivalent to TWD 10,000) per year which we can freely use to take training within or outside the company to develop ourselves. This continuous growth and progress gives me a sense of accomplishment. I think we’ve got a very good system in place.

Ms. Hsieh , Clerk Consumer Finance Division

Taishin University statistics for 2014 are as follows:

Course Type Course Name Persons Trained

Management Training

Mandatory training for managerial staff

855

Elective training for managerial staff

98

OrientationGeneral training for new hires

27,457

Specialized Training

Specialized training for new hires

9,624

Training for different specializations

5,207

Certification training 45,868

General College

Regulatory compliance training

49,028

Self-growth training 10,993

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Internal Training Courses External Training Courses

Course Type Course Name Persons Trained Course Name Persons Trained

Management training

Management trainer skills 896 - -

Talent pool training 858 - -

Orientation General training for new hires 15,672 - -

Specialized training

On-the-job training (OJT) 94,342 - -

Specialized training for new hires 19,746 - -

Training for different specializations 14,689Training for different specializations

3,671

Certification training 1,244 Certification training 1,652

General knowledge training

Regulatory compliance training 8,738Regulatory compliance training

203

Self-growth training 10,993 Self-growth training 163

Note 1:Classroom courses = internal training courses + external training courses. In 2014, 5,689 employees received a total of 38,694 hours of external training, while 167,178 employees received a total of 250,651 hours of internal training. The average per employee was 39.1 hours of training.

List of Classroom Courses (Note 1)

Average Employee Training Hours

Average Employee Training Hours by Role and Gender

Average Training Hours per Employee

in 2014Female Male Average

Hours

Total average

number of hours

Managerial 60.6 54.6 57.4 52.2

Non-managerial 53.3 48.7 51.5

Average Employee Training Hours by Course Type and Gender

Average Training Hours per Employee

in 2014Female Male Average

Hours

Physical Class 39.8 38.2 39.1

Digital Class 14.2 11.5 13.1

Total 54.0 49.7 52.2

• Physical Class • Digital Class • Non-managerial• Managerial

Female

Physical Class Managerial

FemaleFemale Female

Male

Digital Class Non-managerial

MaleMale Male

39.8

39.1 57.4

13.1 51.5

60.614.2 53.3

38.2 54.611.5 48.7Average hours by gender

Average hours Average hours

Average hours by gender

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Competitive Remuneration Taishin’s remuneration system has been designed as a triple-win system that enhances corporate performance, improves return on equity, and takes care of employees. In order to attract and retain talent, Taishin annually participates in regional salary surveys and analyzes top-notch local and foreign financial institutions as a market benchmark, to ensure that we provide competitive remuneration to our staff. In 2014, Taishin was selected in the first ever issue of “Top Salary 100 Index” of the Taiwan Stock Exchange. Taishin aims to increase profitability, reward employees accordingly, and fulfill its corporate social responsibility.

Diversified Remuneration SystemTaishin Financial Holdings offers salaries based on objective factors such as education and competencies required for a position. Starting salaries for every position are higher than the levels prescribed by the Labor Standards Act. Annual salary adjustments are determined through performance evaluation, taking into account the diversity of profession of each position, the level of maturity of skills demonstrated by each employee, etc. The remuneration system ensures there is no differentiation based on gender, age or ethnicity. Regarding overall remuneration levels of male and female employees at Taishin in 2014, there is no significant difference between the genders. Male managerial employees collectively earned 105% of their female counterparts, and male employees in general positions collectively earned 101% of their female colleagues.

Remuneration Comparison by GenderRemuneration

comparedManagerial

rolesNon-managerial

rolesFemale 100% 100%

Male 105% 101%

Each year, Taishin Financial Holdings pays out year-end bonuses based on company performance and individual performance, in order to share profit with employees and thereby reward them for their contributions. Also, in view of

III.Remuneration and Benefits

General staff Sales staff

Year-endbonusTotal personal

remuneration

Performancebonus

ChineseNew Year bonus

ChineseNew Year bonus

Basic salary - 12 months

Basic salary - 12 months

Remuneration Structure

the high transition of global financial professionals, Taishin makes talent rewarding plans according to its strategy in each stage and uses various performance-dependent long-term incentives to attract, retain, and motivate talent.

Employee Stock OptionsSince 2004, Taishin Financial Holdings has issued a total of four series of employee stock options, a record in Taiwan’s financial services industry. In total Taishin has issued options for 377,000 thousand shares, of which options for 40,000 thousand shares have been exercised. The employee stock options improve group coherence and are a way to share the company’s long-term operating results with employees.

Taishin Stock Appreciation Rights Program Since 2012, Taishin Financial Holdings has launched a stock appreciation rights program, whereby annual surplus is partly paid out in cash, and partly linked to the company’s future stock price in order to let employees share in the company’s future operating risks and operating results. In 2014, Taishin issued 30,159 units, a 10% increase from 2013.

Employee Stock Ownership ProgramIn 2013,Taishin Financial Holdings initiates a capital raising plan, employees were given the priority to purchase 50,000 thousand shares. More than 5,000 employees of Taishin Financial Holdings and its subsidiaries were entitled to participate in this program.

Performance ManagementFor many years, Taishin Financial Holdings has used the Balanced Score Card (BSC) to manage performance. Under the BSC system, and in order to implement the philosophy of sustainable management, the company’s strategic goals are broken down into various specific objectives and benchmarks while considering the balances between customers, employees, processes and financial aspects.

Individual employees have their supervisors to provide guidance and assis tance at any t ime, and each employee’s performance is assessed against his or her personal objectives using the Management by Objectives (MBO) method. All employees, regardless of gender or position, receive a mid-year and annual assessment. The performance management system provides outstanding employees with opportunities for promotion, competitive remuneration, and career development. Employees whose performance falls short of expectations are offered assistance to improve.

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Description of Employee Benefits

Benefit Item Benefit Details

Basic benefits• Labor/national health/group insurance, medical/accident insurance for parents, festive bonuses,

meal allowances, and special leave of absence for more days than required by law (e.g. leave for children’s weddings, self-arranged paternity leave within a seven-day period)

• Group insurance plan

Subsidies• Marriage and funeral subsidies• Children’s education subsidies• Long service bonus system

• Birthday travel allowances • Compassionate measures• Education subsidies

Seminars and courses

• Stress relief and health seminars• Arts courses• Movie appreciation

Health check-ups • Regular health check-up subsidies superior to that required by the Labor Health Protection Regulations

Financial productsdiscounts

• Low interest mortgages for bank staff, retail loans, preferential exchange rates and fee waivers, and merchant discounts.

Employee RetirementTaishin Financial Holdings organizes farewell parties to thank retiring employees for their contribution and to wish them well for their retirement. A retirement gift is presented as a token of gratitude. For current employees, the company makes contributions to employees’ pension funds in accordance with the Labor Standards Act and the Labor Pension Act.

Competitive remuneration

positioning

A mechanism for regular and

fair remuneration adjustment

Long-term reward program for talent

retention

Performance-based bonus system

The target position for overall remuneration is higher than the market average for high-performing talent, and higher than the market’s medium-high range for outstanding talent. In recent years, annual budget

increase for salary adjustments all reached 3% or above.

I n a d d i t i o n t o t h e s t o c k appreciation rights program, there have been four rounds of issuance of employee stock options, a record in the financial services industry.

In recent years, high-performance employees received bonuses equivalent to at least 10 months of salary on average.

Employee BenefitsFrom building a sound work environment to maintaining a robust corporate culture, Taishin strives to give its employees the best workplace, and tends to their well-being by providing comprehensive caring. In addition to

satisfying the basic requirements of the Labor Standards Act, the company has in place a superior system to help its employees enjoy work and maintain a balanced lifestyle. In 2014, Taishin Financial Holdings spent an average of TWD 1,405,080 on welfare per employee (not including directors and supervisors), an increase of TWD 2,869 from 2013.

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Declaration and Implementation on Protection of Labor and Human Rights In order to give concrete shape to its protection of labor and human rights, Taishin in 2014 published on its intranet a statement that reaffirmed the prohibition of sexual harassment in the workplace. The company also released a statement on the protection of labor and human rights and included this statement in the corporate ethics course for new employees and the must-read pop-up windows of the online HR system to not only raise employees’ awareness of labor and human rights protection, but also strengthen the foundation of corporate ethics throughout the company. In 2014, 7,976 employees took corporate ethics-related training for a total of 1,595 hours.

Building Harmonious Labor-management Relations

Reasonable working conditions and labor-management consultationFor the protection of employee rights and the promotion of labor-management cooperation, and to enhance the work efficiency of employees, Taishin has established regulations regarding reasonable working hours, resting hours, and leave in accordance with the law. The company holds regular labor-management conferences, where labor and management representatives in legally compliant numbers and gender compositions are selected to discuss issues and make decisions that promote labor-management harmony. As a result, no labor dispute-related compensations occurred in 2014.

Open Communication Channels between Labor and ManagementTo encourage employees to report illegal conduct and to file a complaint when their rights and interests are being or in threat of being damaged, Taishin has established various unimpeded channels of communication for employees to do so. The channels of communication are clearly stated in the Employee Code of Conduct and are published on

IV.Human Rights Protection

Taishin actively protects the human rights of its employees. The company abides by Taiwan’s Labor Standards Act and related regulations, the labor laws of other countries where it operates, international labor standards, and the Universal Declaration of Human Rights. In addition, Taishin observes the following principles for the protection of labor rights and human rights. In 2014, no cases of discrimination or human rights violations were reported.

the company’s intranet to ensure that the channels remain unimpeded, attract recommendations, and continue to develop. These channels include:

Employee telephone lines, electronic and physical mail boxes: All employees can make recommendations to the company via telephone, email or written report.

Employee Commitment Survey: Surveys are conducted from time to time as a formal communication platform between the company and its employees.

Taishin Holdings Quarterly Morning Conferences: The meetings are hosted quarterly by the Chairman. A video-audio newsletter regarding the issues discussed in each meeting is circulated to all employees after the meeting.

Prohibition of Discrimination, Sexual Harassment and Forced LaborTo maintain an equal and safe working environment, Taishin treats employees equally in terms of hiring, remuneration, promotion, rewards, and penalties, without discrimination on any of the identities or circumstances set forth in Article 5 of the Employment Service Act. The Employee Code of Conduct expressly and strictly prohibits sexual harassment and intimidation in the workplace. Moreover, Taishin offers employees adequate space for autonomy in their work, and forced labor is prohibited.

In addition, to ensure that any sexual harassment incidents are impartially and thoroughly reviewed and penalized, Taishin has established sexual harassment prevention, complaints, and punishment guidelines in accordance with the law, and a “Sexual Harassment Prevention and Complaints Review Committee” is in place to investigate and review complaint cases impartially and thoroughly.

If an employee encounters discrimination, sexual harassment or forced labor, and this has been confirmed by investigation, Taishin forwards the case to the HR personnel appraisal committee as per the investigation result and the employee reward and penalization guidelines, in order for the committee to decide on penalization. Taishin offers appropriate protection to the employee who filed the complaint and those participating in the investigation, in order to avoid retaliation and unfair treatment.

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Creating a Workplace that Balances Work and FamilyIn addition to ensuring employees’ basic working and living conditions, Taishin concerns itself with the personal growth of its employees and their balance between work and family. Thus, Taishin not only offers such gender equality mechanisms as menstrual leave, paternity leave, and family care leave, as required by law, but has additionally introduced children’s wedding leave to facilitate employees’

attendance at such important life events as the marriage of their children, allowing employees to participate in and devote themselves to family activities without regrets.

Family Leave Applications

Year Children’s wedding

Paternity (days)

Family care (days)

2014 4 400 3,871

2013 5 335.5 3,013

2012 1 446.5 2,942

In line with the government’s pro-natalist policy and woman re-employment policy, Taishin offers unpaid parental leave and a return-to-work mechanism, as required by law, provides daycare allowances and nursing breaks for female employees returning to the company after parental leave, and has well-equipped and comfortable breastfeeding rooms in our Ren’Ai, Neihu and Jianbei offices to cater to the aforesaid female employees’ nursing needs. In 2014, these rooms were used by about 180 employees.

Retention Rate of Full-time Employees with Parental Leave

Item

2014 2013

Intending to return to work (people)

Effectively returning to

workReturn rate

Employed after one

year

Retention rate

Intending to return to work (people)

Effectively returning to work (people)

Return rateEmployed after one

year

Retention rate

Female 76 67 88.2% 66 93.0% 101 71 70.3% 67 87.0%

Male 11 3 27.3% 1 25.0% 10 4 40.0% 4 80.0%

Total 87 70 80.5% 67 89.3% 111 75 67.6% 71 86.6%

Return rate = number of employees effectively returned to work/number of employees intending to return to work in a given year

Number of employees still employed after one year = employees effectively returned to work and still employed after one year Retention rate = Employees employed in a given year/ employees returned to work in the year before

1

23

1

2

3

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Caring for Employees, Providing a Safe and Friendly WorkplaceBarrier-free spaces: Disability-friendly facilities such as wheelchair ramps and low elevator buttons are being implemented in offices and buildings to ensure the safety, convenience, and equal work rights of disabled employees.

Fire drills: Taishin Tower and our Neihu office hold fire drills to ensure workplace safety and crisis response capability.

Taishin has long been an advocate of smoke-free workplaces. Taishin Tower was granted the Badge of Accredited Healthy Workplace for Tobacco Control Policy by the Taipei City Government, the validity of the badge being from November 1, 2011 through December 31, 2014. Smoking by employees or business partners is prohibited anywhere within office building premises. The company’s smoke-free policy and the Tobacco Hazards Prevention Act are communicated to employees during occupational safety and health training held once every three years.

Establishing the Occupational Safety and Health CommitteeIn 2002, our main subsidiary Taishin Bank established an “Employee Safety and Health Committee”, accounted for one-third of committee members, so that employee views are fairly expressed. The bank’s “Employee Safety and Health Work Regulations” were acknowledged by the Taipei City Government’s Department of Labor, a testament to how the company values its employees’ safety and health, and the importance placed on preventing occupational hazards. In order to raise employee awareness of occupational safety and health, there is a dedicated section

V.Working Environment and Labor Safety

on Taishin Bank’s intranet that provides information and regulations regarding occupational safety and health. In 2014, the bank held 46 employee safety and health training sessions and trained a total of 2,233 staff.

Employee Safety and Health Training Sessions

Year Sessions Participants2014 46 2,233

2013 64 3,604

2012 36 1,318

Taishin employees are protected by on-site police officers, security guards, and a security system, the former two of which receive regular training in accordance with the Private Security Service Act. This training includes information security, the Personal Information Protection Act, the Foreign Account Tax Compliance Act (FATCA), emergency response, crisis management, and crime prevention, in order to protect the human rights of employees and customers. Due to these efforts in occupational safety and health management, no incidents of occupational death, disability, or injury occurred in 2014.

Occupational Hazards

TaishinFinancialHoldings

Injuries fromOccupational

Accidents

Deaths fromOccupational

AccidentsWork Days

LostInjury Rate

Absence Rate

Percentage ofDays Lost

Female 0 0 0 0 647.7 0

Male 0 0 0 0 630.8 0

Total 0 0 0 0 1,278.6 0

injury rate = total injuries/total work hours x 200,000;

Total work hours = total employees x work hours per day x number of working days per year;Absence rate = total days absent/total working days

x 200,000 (including sick leave and occupational injury leave)

Lost working days rate (LDR) = lost working days / total working hours x 200,000

1 2 3

1

2

3

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VI.Staff Care and Activities

Employee health is an important asset to every enterprise. In order to ensure employees’ physical and mental health, and for the employees to manage their health effectively, Taishin not only provides a safe and comfortable working environment and a friendly workplace, but also offers employee health check-ups in hopes that the employees will implement prevention over cure and can be aware of their health conditions through regular health check-ups. The company hopes that every employee is healthy.

Workplace Health Management and CareIn 2014, Taishin hired a full-time in-house nurse to look after the health of its employees. Every three months, the company also invites a specially appointed occupational medicine physician to visit our workplaces and provide healthcare advice and an environment, health and safety (EHS) assessment. The workplace health management and care measures are as follows:

Health PromotionIn 2014, the full-time nurse issued information bulletins in relation to the food safety scandals during the year, offering health information and points of attention regarding food. Also, the specially appointed occupational medicine physician visited Taishin Tower to deliver analyses of employee health check-ups and offer an occupational health counseling clinic, helping employees to adjust their lifestyles

and diets and, if necessary, appointing specific outpatient department for further consultation and diagnosis.

Environment, Health and Safety AssessmentUnder coordination of the employee safety and health manager, the specially appointed physician and nurse visited and assessed the workplaces of Taishin employees. During the visits and inspections, the physician and the nurse identif ied and assessed the hazards of the workplaces, and offered advice to the employer regarding employee safety in the workplaces, as well as recommendations regarding the improvement of the lay-out and facilities of the workplaces.

Based on the physician’s advice and recommendations, Taishin has implemented occupational safety-related prevention programs. As the company sets great priority by the health of its employees, the residential nurse has set up a health management platform to take care of the health of the employees, who have expressed that they appreciate the service tremendously.

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Staff Care and ActivitiesTaishin thoughtfully organizes a variety of employee health activities to ensure that its employees are able to maintain their physical and mental balance despite their busy work, thus achieving a win-win for the company and its employees.

Stress Relief AreaTo reciprocate employees’ hard work, Taishin introduced massage services by visually impaired masseurs in 2010. This year, the massage services have been extended to more employees, with Stress Relief Areas set up in Taishin’s Ren’Ai, Neihu, Jianbei, Zhongshan, and Nangang office buildings. One massage session takes 15 minutes, and the fee is a TWD 25 donation to the Taishin Charity Foundation in support of small and medium-sized charitable organizations. This way, the employees can enjoy a moment of relaxation and support charity at the same time. In 2014, nearly 24,000 massage sessions were given, and the sum of donations came close to TWD 600,000.

Outdoor Sports EventsCombining health with fun, Taishin has a tradition of holding hiking events and sporting events to offer employees and their families playful exercise and nature sightseeing. With support from the company and encouragement from team members, friendly ball games are held to give employees an opportunity to compete against one another.

Diverse Community ActivitiesIn 2014, the company sponsored 24 employee clubs, including those for golf, softball, badminton, basketball, table tennis, aerobic yoga, cooking, ukulele and so on, with a combined membership of about 1,000 members. Through these clubs, employees can develop a second specialty and pursue their interest.

Occasional VolunteeringThe Taishin Bank Foundation for Arts and Culture and the Taishin Charity Foundation jointly offer cultural tours, and volunteer trips to rural and remote areas to accompany the elderly and children, which makes our employees appreciate their own good fortune once more.

Taishin LibraryThe Taishin Library was established in Taishin Tower in 2010 to encourage good reading habits. The library features a collection of 1300 titles in different genres from finance, literature to recreation, with finance, literature, and spirituality being the largest categories. The library received more than 1500 visitors in 2014.

Social Involvement

I.Charity and WelfareII.Arts and Culture Development

III.Sports SponsorshipIV.Academic Exchange

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60

Sports Sponsorship

Charity and Welfare

Arts and Culture DevelopmentAcademic

Exchange

• Campaign A: Caring Taiwan• Campaign B: Power of Love• Other Contributions provided for the society

• Campaign A: Taishin Arts Award• Campaign B: Taishin Friday Noon Concerts• Campaign C: Taishin Tower Exhibition• Campaign D: Young Banker Officer

Creative Art Contest

• Campaign A: Peking University Cross-Strait Academic Fund

• Campaign B: Academic-Industry Cooperation Program and Scholarships

• Campaign C: Young Banker Officer Education Outreach

• Campaign A: Female Golf• Campaign B: Nantou County Youth Karate Team

Taishin Financial Holdings uses its corporate resources and brand power influence to fulfill its motto of “Giving Back to the Society”. Taishin hopes that through leveraging the resources of the company, it can sustain its attention and contributions to the land of Taiwan. In addition, it actively develops distinct participation mechanisms to meet the needs of various groups in society, including the needs for charity and welfare, arts and culture development, sports activities and academic interaction. This corporate strength, it is hoped, will join forces with many other initiatives to help for developing a better society.

Arts and Culture Development: Taishin Friday Noon Concerts

From 2012 through 2014 we held

70 concerts attended by more than

17,800 people.

Charity and Welfare:Charity Foundations

Our ‘Power of Love’ campaign in 2014

attracted about 1.15 million votes and helped more than 80 charity groups.

Sports Sponsorship

From 2005 through 2014, we sponsored the Nantou County Youth Karate Team, which has won

1,088 medals (including 399 Gold, 325 Silver and 364 Bronze).

Social Involvement

61

Social Involvement ｜ 2014 Corporate Social Responsibility Report

Caring Taiwan

In the spirit of “Teaching a man to fish, feeding him for a lifetime”, Taishin launched the Caring Taiwan campaign in 2002. Originally intended to support victims of the 921 Earthquake to rebuild their lives, the campaign gradually came to embrace and support individuals and communities in need all around Taiwan.

The “My One Acre of Farm” activity has run a new cooperative platform for Taiwan's rice production and marketing since 2008, calling on businesses to adopt rice fields. As an extension of this activity, “One Acre for my

I.Charity and WelfareFor Taishin Financial Holdings, charity and welfare means not only keeping consistant commitment to the social concerns, but also assisting disadvantaged groups to become “economically independent and self-reliant”, the latter of which has always been the goal of charity and welfare programs of Taishin. In this vein, the Caring Taiwan campaign that started in 2002 has given rise to broader and deeper initiatives including further efforts in the Caring Taiwan campaign, the establishment of a charity foundation, and the Power of Love campaign. These, in addition to the resources allocated each year according to practical needs, are concrete manifestations of Taishin’s attention for charity and welfare.

Family” further calls on families to adopt rice fields. By the end of 2014, Taishin had adopted 120 units of rice paddies, with a total area of 60 hectares, and had given out more than 50,000 gift boxes of rice. Over 10,000 clients and colleagues have been able to enjoy almost 200,000 Kg of high-quality rice from these fields. In 2014, RiceFarmer, which helped to create the rice production and marketing platform, was invited to join Taishin Charity Angels. RiceFarmer has committed to donating rice and offering farming experience programs to charitable organizations as a way to serve disadvantaged groups.

Caring Taiwan campaign• 2002: Post-disaster assistance to Nantou

began. Annual rebuilding projects were carried out, one town a year.

• 2008: My One Acre of Farm project was launched.

• Up to 2014: Nearly 60 hectares of farm land has been adopted.

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“Power of Love” campaign

Despite the strong power of love demonstrated again and again by the people of Taiwan, many small and medium-sized charity groups have difficulties in operating or fundraising due to the fact that they are little known to the public or not good at promoting themselves. In order to make more people recognized these organizations, and to support those organizations or individuals truly in need, Taishin Charity Foundation was established in 2010 and has since run the “Power of Love” campaign, Taiwan’s first major online charity campaign. The campaign has attracted more attentions from society and online groups, and has set a new trend in charity in Taiwan.

In this campaign, Taishin Charity Foundation sets up the charity fund, and charity groups are invited to present themselves and their project proposals on the campaign’s website, which the public can browse and which invites the public to vote for the organizations they support, in order to allocate the limited resources of the fund to the most supported charitable organizations. This way, charities with the most votes will be able to carry out their proposed projects with financial support from the charity fund. The objective is to redistribute society’s resources in a fair way and stimulate charitable organizations to develop themselves. In addition, we encourage volunteers to coach the funded charities and help them complete their projects. The execution results are disclosed to the public.

During the fifth “Power of Love” campaign in 2014, close

to 300,000 people cast almost 1.15 million votes, a record in the five-year history of the campaign. In this campaign, people could vote for projects in three major areas: Social Welfare, Culture and Education, and e-Learning. In addition to the charity fund set up by Taishin Charity Foundation, more charity funds were provided by Advantech Foundation for culture and education initiatives, and by Chunghwa Telecom Foundation for e-learning initiatives.

In addition to voting, the fifth campaign invited popular comic character Chibi Maruko-chan to serve as an event ambassador for the campaign, with a view to raising public awareness and encouraging participation. Through micro films, charity film screenings, andonline lotteries centered on her, the general public was informed and sensitized about social welfare issues.

Charity Foundation• Established in 2010, and starting the Power

of Love campaign.

• Charity Angels were invited as a way to combine resources within and without the company.

• Taishin employees were encouraged to participate as volunteers.

• The 5th "Power of Love" campaign was held in 2014, with about 1.15 million votes cast by nearly 300,000 people.

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• Promotion of the “Charity Art” program, inviting artists to participate in product design and charity painting projects for the sake of charity

• Collaboration with sociology/social work departments of universities

• Advocation of Taishin Charity Cloud, bringing donors and charities together.

• Involvement of social departments of local governments

• Charity Angels were invited to provide resources and assitance

• Other supports to unselected charities: donations in kind, workshops, art appreciation, etc.

• Inclusion of corporate volunteers

• Cooperation with strategic partners to expand the charity fund

• Launch of the "Power of Love" campaign, which is Taiwan's first ever major online charity event

• Launch of the Glimmering Project to support inferior charities

2010 2011 2012 2013 2014 2015

Taishin volunteer work

Taishin encourages employee volunteer work. As an incentive, every six hours of volunteer work may be exchanged for one day of “volunteer honor holiday”, and from time to time the Holdings provides motivation courses and art performances to those who participate in volunteer work. Moreover, outstanding volunteers may receive commendations from the Chairman or senior management in person. So far about 300 employees have joined the volunteer team, which has traveled the length and the breadth of the country to serve disadvantaged groups. This year for the first time former and retired employees, as well as employees’ families and friends, were also invited to join volunteer activities. The power of love keeps growing.

Strategic Partner - Frank.Lin, Director of Advantech Foundation

Advantech joined the “Power of Love” campaign in 2011. Through cooperation with Taishin, we offered practical assistance to disadvantaged groups. The campaign not only creates a platform for charity issues, but also helps raise the visibility of charitable organizations, a win-win-win for companies, strategic partners, and charities.

Strategic Partner - Mike Lin, CEO of Chunghwa Telecom Foundation

Taishin’s “Power of Love” campaign draws creativity together. It allows charities to learn how to promote themselves through the Internet. The campaign is in line with the goal of Chunghwa Telecom to reduce the digital divide and complements our resources for achieving that goal.

Charity Angels –Eric Chang. Managing Director of OgilvyOne Managing

As a digital advertising agency, OgilvyOne usually manages commercial projects. It is very meaningful to be able to join the Taishin Charity Angels, offer our experience in online communications to this campaign, and do something truly helpful to our society.

Volunteering gives me positive energy

“By volunteering through Taishin, I came in touch with charities concerned with children, seniors, mentally and physically disabled, and disadvantaged groups. It has given me a lot of positive energy, and I feel it’s great that the company facilitates this.”

A volunteer from the Corporate Planning Division, Taishin Bank

Development stages of the “Power of Love” campaign

Taishin Charity Cloud

Power of Love campaign

64

Other charitable activities

Type Description

Financial Education Camp for Disadvantaged Children

As a player in the financial industry, Taishin felt it should integrate the expertise of its staff with their volunteer work. As a result, this year nearly ten Financial Education Camps for disadvantaged children were held in Taipei, Taichung, and Kaohsiung, to guide them the basic concepts of using money. The activities were well received, and calls kept coming in from charitable organizations for making reservations for next year’s winter camps.

Sales of charity products on 17Life

Since 2011, Taishin has worked with the well-known online mall 17Life to sell charity products that enable charitable organizations to achieve economic autonomy. Every order grows their members’ confidence and dignity. In 2014, a "New Year Special Sale" and "Mid-Autumn Special Sale" were launched, and during the Dragon Boat Festival, 17Life for the first time ever called on its visitors to make donations by purchasing products made by charitable organizations and give to other disadvantaged groups.

Taishin Charity Angels

Many groups and individuals are held back from charity work due to lack of funds or other difficulties. Through the “Taishin Charity Cloud” platform, Taishin connects these dedicated groups and individuals. Anyone is welcome to give what they have, whether volunteer work, donations in kind, small fundraisers, professional skills, advice and help with publicity and marketing, etc. So far more than 30 companies and organizations have joined Taishin Charity Angels to create economic autonomy for disadvantaged groups.

Charity Art Programs

In 2014, two foundations of Taishin Financial Holdings, namely the Taishin Bank Foundation for Arts and Culture and the Taishin Bank Charity Foundation, jointly launched the " Charity Art" program, which invited civic-minded artists, advertising companies, and students with an artistic slant, to use their artistic talent to set in motion a virtuous cycle in society.

Founding angel of Yunus Social Business Centre Taiwan

Taishin Charity Foundation is a founding angel of the Yunus Social Business Centre Taiwan, which is still in its establishment phase. When the center is set up, it will promote the development of social enterprises in Taiwan and offer disadvantaged groups new employment models and opportunities that will help them overcome poverty, which is the center’s mission.

Employees' trip combined with the volunteer program

In 2014, the volunteers of Taishin Charity Foundation who regularly assist charity groups raised the idea of combining employees' trip with the volunteer program first, to give employees the opportunity to have the different experience and invite their families or even all colleagues of entire division to join the volunteer program. For example, the Legal Division inniated one day employees' trip to visit and make volunteer services at Yu An Children’s Home in Miaoli County, and they assisted the children with their daily activities during the trip. At the same time, the “Go-South Urological Research and Education Foundation” donated LED lights, and “Ann Chen Natural Handmade Boutique” donated materials and instruction for making soap. In addition, the Customer Relationship Management Division visited the Ruth Society for Disability Services in Taoyuan County in 2014. There are two volunteer programs in 2014 and more than 70 employees with their family members participated.

Other contributions provided for the society

Type Description

Disaster Relief for Victims of Kaohsiung Gas Explosion

Taishin Bank issued preferential credit financing packages, and would review and disburse the loans within the shortest possible time to help the affected people to rebuild their lives. In addition, Taishin Bank has donated TWD 5 million, while Taishin Financial Holdings and its subsidiaries have donated a total amount of TWD 10 million.

TFF-Bloomberg BEST FUND AWARD – ambulances and medical service vans

In Taiwan, there are still many areas lack sufficient medical resources, or that must make do with outdated equipments in desperate need of replacement. Taishin Securities Investment Trust joined forces with other bodies to upgrade ambulances in those areas, and help develop medical and health clinics in remote villages and in the mountains, so that those residents may utilize improved medical services.

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II.Arts and Culture Development

Taishin Arts AwardThe “Taishin Arts Award” aims to recognize and provided substantial reward to the outstanding achievements in arts in order to increase the energy of the dialogue between contemporary arts and the world, and to promote the public’s understanding and appreciation of contemporary arts. After 12 annual editions held since 2002, the evaluation method was adjusted in 2013, the year of the 13th edition. The annual awards are now based on the following key criteria and awarded to groups or individuals that run or are engaged in culture and arts-related business in Taiwan:

1. Works of art that transcend the existing artistic frameworks and possess a potential for future development.

2. Art exhibitions or performances that inspire deeper and wider social and humanitarian concerns.

3. Artistic projects that redefine art and benefit cross-disciplinary communication or exploration.

Thus we hope to stay close to the concept of “art creating new value for Taiwan”, remain in synch with the interdisciplinary trend in contemporary arts, and reflect on and drive current social phenomena, such that artistic creation will have more possibilities and a greater future.

Until 2014, the Taishin Arts Award has honored 42 artists. For more information on the Taishin Arts Award, please visit the following website:

Taishin is also dedicated to contribute to the society through arts and culture. Its arts promotion aims to make Taiwan’s local art shine even more. A variety of sponsored arts and culture events are offered to help the public develop a better understanding and appreciation of the arts.

In 2014, Taishin sponsored the 2014 Taipei Biennial at the Taipei Fine Arts Museum, as a concrete action to support the development and promotion of the arts.

Taishin Arts Award

Taishin Tower Exhibition

Young Banker Officer Creative

Art Contest

Friday Noon Concerts

Award is fuel for good arts

“It feels wonderful to receive the Taishin Arts Award. I hope more young artists will join the contest. They’re the future prize winners. The Taishin Arts Award is not only a piece of delicious cake, but also the fuel to create good arts.”

Artist Peng Hongzhi

Arts and Culture Development

Taishin Awards' Final Selection JuryJoseph Seelig, Director of London International Mime Festival

I was enormously impressed with the originality and high standard of the projects submitted by finalists of the Taishin Arts Awards. On that evidence contemporary Taiwanese artists are energetically developing their own distinctive language and culture. In placing a high value on encouraging the arts in Taiwan, the Taishin Arts Awards fulfil an important leadership role.

http://www.taishinart.org.tw/english/2_taishinarts_award/page.php

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Taishin Friday Noon ConcertsFrom the first concert in 2006 until today, “Tasihin Friday Noon Concerts” have embodied Taishin’s intention to serve for the communities and customers. Each month, well-known musicians from domestic to overseas are invited to perform music in a variety of genres, to help urban residents wind down from their busy lives. Every year around 23-24 concerts are held, reaching a total of 212 concerts to date. In 2014, Taishin also sponsored a concert of the New York Philharmonic, and hosted art lectures and art film screenings from time to time to broaden the public’s artistic horizons.

Friday Noon Concerts statistics in 2012-2014

Year Concerts Visits

2014 23 6,247

2013 24 5,899

2012 24 5,711

Taishin Tower Arts Exhibition in LobbyIn the spacious lobby of the Taishin Financial Holdings headquarters, contemporary art installations and art exhibitions have been on display on a regular basis since 2006. Until the end of 2014 a total of 38 such exhibitions have been held, averaging more than one per month. Taishin hopes to create different atmospheres through artists’ whimsical worlds and also to offer the public the opportunity to see these outstanding works for free.

Young Banker Officer Creative Art ContestIn 2012, Taishin Bank held the first Draw Your Dream with Yani contest with golf celebrity Yani Tseng. As the event drew an enthusiastic response, the first children's creative drawing contest was held in 2013, with "My Dream" as the theme. The contest attracted more than 2,500 creative entrees of children drawing their dreams, including children invited by the Taishin Charity Foundation from charitable organizations. In 2014, the second Young Banker Officer (YBO) Creative Art Contest was held. The “A happy….” theme invited children to use their pure imagination and free spirit to commit their ideas of happiness and freedom to paper. This theme also aims to help parents understand their children better.

The YBO Creative Art Contest is open to children from kindergarten to elementary school, and is divided into "kindergarten and elementary grades 1-2", "elementary middle grades" and "elementary high grades.” In each group, 12 excellent and 50 outstanding works are selected. Over 5,000 entrees have been submitted to the first and second annual contest.

Great lunch time with wonderful music

This was definitely a great lunch break for me. I hope these Friday noon concerts will keep being offered for a long, long time, They’re like chicken soup for the soul.

Mr. Ye, visitor

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III.Sports SponsorshipNantou County Youth Karate Team Since 2005, the Caring Taiwan campaign has sponsored the Nantou County Youth Karate Team. The objective is to foster the fighting spirit in young people through sports and to create the valuable “power of a virtuous cycle” through years of dedicated efforts.

(1) Results in terms of donations: From 2005 to 2014, a total of over TWD 60 million has been donated to the Nantou County Youth Karate Team through fundraising, direct sponsoring, and PayEasy invoice donations (since May 2008).

(2) Results in terms of entrance into colleges/universities: Members of the Nantou County Youth Karate Team who won major domestic Karate competitions are given athletes bonus points in the university entrance examinations to increased their access to higher education. At least 200 young karate athletes have been able to enter (public) universities this way.

(3) Results in terms of community development: With the fixed amount of income from donations to sustain stable operations of the team, the team members feel at ease and can fully concentrate on their practice and preparations for major competitions. Winning more medals this way builds their confidence, and their outstanding performances in the competitions may also inspire their family members, help generating a positive atmosphere in their families, and consequently enhance the self-healing power of their communities after the 921 disaster.

(4) Results in terms of public participation: In each year-end thank-you concert, the karate athletes are invited to meet with about 6,000 donors.

(5) Special achievements: Since its inception, the team has cultivated eight President Educational Award recipients.

This sponsorship has received the 2011 (7th) and 2012 (8th) Corporate Social Responsibility (CSR) award from Global View Magazine.

Team member Gu Tsuei-Ping represented Taiwan at the 2014 Asian Games Incheon, South Korea, winning a gold medal in women karate in the 50-Kg class, serving as a role model for disadvantaged children.

Up to the end of 2014, a total of 399 gold medals, 325 silver medals, and 364 bronze medals have been collected in competitions.

Female GolfSince 2011, Taishin Financial Holdings and Taishin Bank have been actively involved in the promotion of female’s golf, not just through providing the necessary funding, but also through paying and drawing attention to the overall development of this sport and talent development, as well as care for the sponsored players. Taishin’s roles in this campaign include:

Provide strong support to Taiwan’s golf players

• Sponsoring world-class players: As the first financial enterprise to sponsor an international woman golfer, Taishin has sponsored Yani Tseng since 2011. The partnership has led to excellent results: Tseng became the youngest-ever champion, to win five major international tournaments.

• Sponsoring high-potential Taiwanese players: Since 2013, Taishin has sponsored eight outstanding golf players including Babe Liu, Pei-Yun Chien, Huei-Ju Shih, Hsin-Yun Chuang, Ruby Pan and Pei-Ying Tsai, etc. In more than a year, these golfers have accumulated ten championship titles, six second-place titles and two third-place titles, a dazzling series of successes.

• Taishin actively cultivate domestic sports rookie byproviding substantial encouragement and bonuses.

Create a stage for players• Recently, Taishin sponsored the annual tournaments of

the Taiwan Ladies Professional Golf Association (TLPGA), to create a stage for women golf players and allow them to strengthen their game through practical experience, to collect points, and to hone their skills in a perfect game environment.

Serve as a bridge between players and fans• Before games: On the eve of the five major LPGA

tournaments, Taishin calls on the people of Taiwan to cheer the country’s players.

• During games: Business executives, colleagues, customers, and even media reporters are invited to the game venue to cheer for the players.

• Off-season: Annual golf activities with Taishin’s sponsored athletes are held to enable golf-loving clients and VIPs to meet and express their support for the athletes. Taishin also encourages people to send cards with messages of encouragement or birthday wishes to its sponsored golf players to express their care and support.

Taishin helps golf players excel

Thanks to Taishin Financial Holding's sponsorship, I’ve been able to play on the international golf circuit without financial pressure. This has allowed me to concentrate and achieve good results. I’m grateful for the way Taishin supports the golf sport.

Yani Tseng – sponsored golf professional

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Peking University Cross-Strait Academic FundIn 2012, Taishin Financial Holdings and Guanghua School of Management, Peking University, signed a Memorandum of Understanding that established the “Peking University Cross-Strait Academic Fund”. The fund issues grants and scholarships annually to students and faculty of Peking University, and arranges academic and substantive exchanges between both sides, as well as reciprocal visiting programs for financial talent across the strait to exchange experience in the financial field. In 2014 the Fund invited Peking University students to visit Taiwan for an exchange with National Taiwan University students on the topic of third-party payments.

IV.Academic ExchangeThe growth of a financial system and business hinges on their dedicated efforts in developing financial talent and passing on financial knowledge. In order to cultivate more talent for Taiwan’s society and to give expression to its people orientation, Taishin has long engaged in academic interactions in many ways.

73 became full-time employees

Young Banker Officer Creative Financial

Management Camp

Academia-Industry Cooperation Program

and Scholarship

Peking University Cross-Strait Academic

Fund

Academic Exchange

Total 171 trainees

Academia-Industry Cooperation Program and ScholarshipSince 2011, Taishin Bank has engaged in cooperation with a number of universities and technical and vocational institutions, to offer students an opportunity for training and traineeships outside the campus. In 2014, this program enabled 171 students to gain practical experience and expand their professional competences. 73 of these trainees passed the recruitment selection process and joined Taishin Bank as full-time employees.

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The “Young Banker Officer Creative Financial Management Camp” was held five times in the summer of 2014, attracting more than 100 children. The goal was to give them a good time through DIY activities, and to make them cherish what they have got. The camp consisted of two parts. In the first part, the children learned how to make paper models. In the second part, they were introduced to “Young Banker Officer Fantastic Farm”, a fun educational game developed by Taishin Bank, which combines Monopoly with situations from real life, such as managing pocket money, paying school fees and expenses, and covering unexpected events. Through the game, the children learned about the correct concepts of financial management, including target-based financial management, insurance, and so on.

Based on its principles of giving back to the society and nurturing outstanding talent, Taishin Financial Holdings offers scholarships to National Taiwan University and National Chengchi University students from disadvantaged backgrounds and with outstanding grades. From the 2012 school year, Taishin managers serve as guest lecturers for the course of “Topics in Practices of Innovations and Improvements in Financial Services Industry” at National Taiwan University. The course enables students to bridge and integrate the theories learned at university with the practice encountered in industry.

Academic scholarships for National Taiwan University and National Chengchi University students

University National Taiwan University (NTU) National Chengchi University (NCCU)

Scholarship NTU-Taishin Finance Scholarship National Chengchi University-Taishin Financial Holdings Finance Scholarship

Target group and conditions

1. Undergraduate and graduate students of the Department of Finance.

2. Priority given to students in need or outstanding students.

1 .Undergraduate and graduate s tudents o f the Department of Money and Banking, the Department of Finance, and the Department of Accounting.

2. Priority given to students in need or outstanding students.

Modes of Support

- Scholarship- Traineeships and internships at Taishin Financial

Holdings or its subsidiaries.

- Scholarship- Traineeships and internships at Taishin Financial

Holdings or its subsidiaries.

Other modes of cooperation

- Design and delivery of the course “Topics in Innovations and Improvements in Financial Services Industry”, a two-credit elective

- Taishin managers serve as guest speakers from time to time.

In addition, Taishin is also actively involved in promotion of academic activities to raise the general public’s awareness of and interest in financial and economic topics. Taishin sponsored 19 such academic events in 2014.

2010 2011 2012 2013 2014

• Launch of Young Banker Officer Accounts

• More than 20 story-telling events and money management activities in cooperation with the kids’ Story House

• Launch of “Young Banker Officer Fantastic Farm” educational game

• Children's finance camps

• Launch of the educational project “We Will Fly No Matter What” in collaboration with LuxuryLogico and the Taishin Bank Foundation for Arts and Culture

• Cooperation with LPGA golf celebrity Yani Tseng: Yani passbooks, Yani ATM cards, and "Draw your Dream with Yani” contest

• “First Young Banker Officer Creative Drawing Contest”

• Children's golf camps• “Young Banker Officer

Fantastic Farm” Camp held with charities

• “Second Young Banker Officer Creative Art Contest”

• “Young Banker Officer Creative Financial Management Camp”

Young Banker Officer Education Outreach

Children’s financial literacy has long enjoyed Taishin’s attention. Therefore, in 2010, Taishin launched the “Young Banker Officer Accounts” for customers under 18 years of age, with exclusive YBO passbooks, YBO ATM cards, and special financial benefits, thus investing more resources in the topic of children’s financial management.

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Appendix

71

Appendix ｜ 2014 Corporate Social Responsibility Report

I. GRI Index and GuidelinesNote: ○ for full disclosure, △ for partial disclosure

General Standard Disclosures Report Chapter Disclosure Status Page Supplemental Information

Strategy and Analysis

G4-1 Statement from the most senior decision-maker Commitment and Vision ○ 3

G4-2 Description of key impacts, risks, and opportunities

Commitment and Vision2014 Performance Highlight

○

3 21

27-29

Organizational Profile

G4-3 Name of the organization About Taishin ○ 5

G4-4 Primary brands, products, and/or services About Taishin ○ 5

G4-5 Location of organization’s headquarters About Taishin ○ 5

G4-6 Number/Names of countries where the organization operates


○ 21

G4-7 Nature of ownership and legal form About Taishin ○ 5

G4-8 Market served

About Taishin2014 Performance Highlight

○5

21

G4-9 Scale of organization

About Taishin2014 Performance HighlightEmployee Care

○

5 18 20 47

G4-10 Breakdown of workforce About TaishinEmployee Care ○

5 47

G4-11 Percentage of total employees covered by collective bargaining agreements Employee Care ○ 54-56

All the employees must read and sign up the “Employee Code of Conduct", for 100% assurance.

G4-12 Describe the organization’s supply chain2014 Performance Highlight

○ 31

G4-13 Significant changes during the reporting period

CSR Topics Analysis2014 Performance Highlight

○

8 14-16 20-33

G4-14 Report whether and how the precautionary approach or principle is addressed


○ 26-30

G4-15

List externally developed economic, environmental and social charters, principles, or other initiatives to which the organization subscribes or which it endorses


○ 32-34

G4-16 Memberships of associations2014 Performance Highlight

○ 34

In addition to being on the executive committee of the Taiwan Securities Association, supervisor at the Chinese National Futures Association, and c o u n c i l m e m b e r a t t h e Ta i w a n Ventu re Cap i ta l Assoc ia t ion , we hold memberships in various other associations and pay dues regularly.

Identified Material Aspects and Boundaries

G4-17 List all entities included in the organization’s consolidated financial statements Report Summary ○ 5

G4-18 Process for defining the report content and the Aspect Boundaries

Report Summary CSR Topics Analysis

○ 5

Appendix

72


G4-19 List all the material Aspects identified in the process for defining report content

CSR Topics Analysis ○ 8、13

G4-20 For each material Aspect, report the Aspect Boundary within the organization

CSR Topics Analysis ○ 10-12

G4-21 For each material Aspect, report the Aspect Boundary outside the organization

CSR Topics Analysis ○ 10-12

G4-22 Report the effect of any restatements of information provided in previous reports

Report Summary2014 Performance Highlight

○5

33

G4-23 Report significant changes from previous reporting periods

Report SummaryCSR Topics Analysis

○5

8-16

Stakeholder Engagement

G4-24 List of stakeholder groups engaged by the organization


G4-25 Report the basis for identification and selection of stakeholders with whom to engage


G4-26 Approach to stakeholder engagement CSR Topics Analysis ○ 8、16

G4-27 Response to key topics and concerns raised CSR Topics Analysis ○ 8、16

Report Profile

G4-28 Reporting period Report Summary ○ 5

G4-29 Date of most recent previous report Report Summary ○ 5

G4-30 Reporting cycle Report Summary ○ 5

G4-31 Contact information Report Summary ○ 5

G4-32 The ‘in accordance’ option Report Summary ○ 5

G4-33 Policy and current practice regarding external assurance

Report Summary2014 Performance Highlight

○5

24-25

Governance

G4-34 Governance structure2014 Performance Highlight

○ 22-25

G4-35 Process for delegating authority for economic, environmental and social topics


○ 24-25

G4-36 Pointed an executive-level position or for economic, environmental and social topics


○ 24-25

G4-37Processes for consultation between stakeholders and the highest governance body on economic, environmental and social topics

2014 Performance HighlightCSR Topics Analysis

○8-16

24-25

G4-38 Composition of the highest governance body2014 Performance Highlight

○ 22-23

G4-39 Report whether the Chair of the highest governance body is also an executive officer


○ 22-23

G4-40 Report the nomination and selection processes for the highest governance body

G4-41Processes for the highest governance body to ensure conflicts of interest are avoided and managed


△ 22-23

73



G4-42

Report the highest governance body’s and senior executives’ roles in the development, approval, and updating of the organization’s purpose, value or mission statements, strategies, policies, and goals related to economic, environmental and social impacts


○ 22-25

G4-43

Report the measures taken to develop and enhance the highest governance body’s collective knowledge of economic, environmental and social topics

G4-44

Report the processes for evaluation of the highest governance body’s performance with respect to governance of economic, environmental and social topics. Report whether such evaluation is independent or not, and its frequency. Report whether such evaluation is a self-assessment

G4-45

Report the highest governance body’s role in the identification and management of economic, environmental and social impacts, risks, and opportunities. Include the highest governance body’s role in the implementation of due diligence processes


○8-16

22-25

G4-46

Report the highest governance body’s role in reviewing the effectiveness of the organization’s risk management processes for economic, environmental and social topics


○ 22-25

G4-47Report the frequency of the highest governance body’s review of economic, environmental and social impacts, risks, and opportunities

G4-48

Report the highest committee or position that formally reviews and approves the organization’s sustainability report and ensures that all material Aspects are covered


○ 22-25

G4-49 Report the process for communicating critical concerns to the highest governance body

G4-50

Report the nature and total number of critical concerns that were communicated to the highest governance body and the mechanism(s) used to address and resolve them

G4-51Report the remuneration policies for the highest governance body and senior executives for the below types of remuneration


△ 22-23

G4-52

Report the process for determining remuneration. Report whether remuneration consultants are involved in determining remuneration and whether they are independent of management. Report any other relationships which the remuneration consultants have with the organization

Employee Care ○ 52-53

G4-53

Report how stakeholders’ views are sought and taken into account regarding remuneration, including the results of votes on remuneration policies and proposals

G4-54

Report the ratio of the annual total compensation for the organization’s highest-paid individual in each country of significant operations to the median annual total compensation for all employees in the same country

G4-55

Report the ratio of percentage increase in annual total compensation for the organization’s highest-paid individual in each country of significant operations to the median percentage increase in annual total compensation for all employees in the same country

Ethics and Integrity

G4-56Describe the organization’s values, principles, standards and norms of behavior such as codes of conduct and codes of ethics


○ 24-25

74


G4-57

Report the internal and external mechanisms for seeking advice on ethical and lawful behavior, and matters related to organizational integrity, such as helplines or advice lines

○

For more det ials about complaint procedure regarding illegal and immoral behavior. Please see the Employee Behavior Guidelines on the official website.

G4-58

Report the internal and external mechanisms for reporting concerns about unethical or unlawful behavior, and matters related to organizational integrity, such as escalation through line management, whistleblowing mechanisms or hotlines

○ Same as G4-57

Specific Standard Disclosures Report Chapter Disclosure Status Page Supplemental Information

Economic Management Approach and Performance Indicators

EC1 Direct economic value generated and distributed CSR Topics Analysis ○

18 20

For more details about financial information,Please see Taishin Financial Holding’s annual report and financial report.

EC2 Financial implications and other risks and opportunities due to climate change

EC3 Coverage of the organization’s defined benefit plan obligations Employee Care △ 52-53

Employees’ re t i rement fund i s a l l o c a t e d m o n t h l y, a s a ratio of monthly salary. This is transferred to the Organization o f S u p e r v i s o r y C o m m i t t e e of Bus iness Ent i t ies ’ Labor Retirement Reserve’s designated account at the Bank of Taiwan

EC4 Financial assistance received from government ○Ta i s h i n d o e s n o t r e c e i v e s subsidy or financial support from the government.

EC5 Ratios of standard entry level wage by gender compared to local minimum wage Employee Care ○ 52-53

EC6 Proportion of senior management hired from the local community at significant locations of operation Employee Care ○ 47 100%

EC7 Development and impact of infrastructure investments and services supported

Social Involvement ○ 59-68

EC8 Significant indirect economic impacts, including the extent of impacts

Social InvolvementCustomer Service and Commitment

○59-68 36-44

EC9 Proportion of spending on local suppliers at significant locations of operation


○ 31

Environmental Management Approach and Performance Indicators

EN1 Materials used by weight or volume

EN2 Percentage of materials used that are recycled input materials

EN3 Energy consumption within the organization2014 Performance Highlight

△ 32-33

EN4 Energy consumption outside of the organization

EN5 Energy intensity

EN6 Reduction of energy consumption2014 Performance Highlight

△ 33

EN7 Reductions in energy requirements of products and services

EN8 Total water withdrawal by source2014 Performance Highlight

○ 33

EN9 Water sources significantly affected by withdrawal of water ○ 33 All water sources come from the

Taiwan Water Corporation.

75



EN10 Percentage and total volume of water recycled and reused

EN11Operational sites owned, leased, managed in, or adjacent to, protected areas and areas of high biodiversity value outside protected areas

○Taishin’s office and business locations are located in urban and rural areas.

EN12Description of significant impacts of activities, products, and services on biodiversity in protected areas and areas of high biodiversity value outside protected areas

○ Same as EN11

EN13 Habitats protected or restored ○ Same as EN11

EN14Total number of IUCN Red List species and national conservation list species with habitats in areas affected by operations, by level of extinction risk

○

All the office buildings and near area finds no national protected species, and wildlifes on the IUCN red listed.

EN15 Direct greenhouse gas emissions (Scope 1)2014 Performance Highlight

○ 33

EN16 Energy indirect greenhouse gas emissions (Scope 2)2014 Performance Highlight

○ 33

EN17 Other indirect greenhouse gas emissions (Scope 3) 33

EN18 Greenhouse gas emissions intensity

EN19 Reduction of greenhouse gas emissions2014 Performance Highlight

○ 33

EN20 Emissions of ozone-depleting substances

EN21 NOX, SOX, and other significant air emissions

EN22 Total water discharge by quality and destination2014 Performance Highlight

○ 33Each office building uses regular tap water. The wastewater is channeled into the sewer system.

EN23 Total weight of waste by type and disposal method2014 Performance Highlight

△ 34Taishin contracts professional, legal cleaning companies to collect and incinerate waste materials.

EN24 Total number and volume of significant spills

EN25

Weight of transported, imported, exported, or treated waste deemed hazardous under the terms of the Basel Convention2 Annex I, II, III, and VIII, and percentage of transported waste shipped internationally

EN26Identity, size, protected status, and biodiversity value of water bodies and related habitats significantly affected by the organization’s discharges of water and runoff

EN27 Extent of impact mitigation of environmental impacts of products and services

EN28 Percentage of products sold and their packaging materials that are reclaimed by category

EN29Monetary value of significant fines and total number of non-monetary sanctions for non-compliance with environmental laws and regulations


○ 32-34 No environmental penalty and sanction issue.

EN30

Significant environmental impacts of transporting products and other goods and materials for the organization’s operations, and transporting members of the workforce

EN31 Total enviromental protection expenditures and investments by type


○ 34

The environmental expense of the Financial Holdings Building fo r genera l was te ma te r ia l disposal was NT$543,312 for and the environmental expense of the Neihu building was NT$237,800 in 2014.

EN32 Percentage of new suppliers that were screened using environmental criteria

EN33 Significant actual and potential negative environmental impacts in the supply chain and actions taken

76


EN34Number of grievances about environmental impacts filed, addressed, and resolved through formal grievance mechanisms

Labor Practices and Decent Work Management Approach and Performance Indicators

LA1 Total number and rates of new employee hires and employee turnover by age group, gender, and region Employee Care ○ 48

LA2Benefits provided to full-time employees that are not provided to temporary or part-time employees, by significant locations of operation


LA3 Return to work and retention rates after parental leave, by gender Employee Care ○ 55

LA4Minimum notice periods regarding operational changes, including whether these are specified in collective agreements

LA5

Percentage of total workforce represented in formal joint management–worker health and safety committees that help monitor and advise on occupational health and safety programs


A total of 17 members are on the occupational health and safety commission, including 6 labor representatives.

LA6Type of injury and rates of injury, occupational diseases, lost days, and absenteeism, and total number of workrelated fatalities, by region and by gender

Employee Care ○ 55

LA7 Workers with high incidence or high risk of diseases related to their occupation

LA8 Health and safety topics covered in formal agreements with trade unions

LA9 Average hours of training per year per employee by gender, and by employee category Employee Care ○ 50-51

LA10Programs for skills management and lifelong learning that support the continued employability of employees and assist them in managing career endings

Employee Care △50-51

53

LA11Percentage of employees receiving regular performance and career development reviews, by gender and by employee category


LA12

Composition of governance bodies and breakdown of employees per employee category according to gender, age group, minority group membership, and other indicators of diversity

2014 Performance HighlightEmployee Care

○22-23 46-47

LA13Ratio of basic salary and remuneration of women to men by employee category, by significant locations of operation


LA14 Percentage of new suppliers that were screened using labor practices criteria

LA15 Significant actual and potential negative impacts for labor practices in the supply chain and actions taken

LA16Number of grievances about labor practices filed, addressed, and resolved through formal grievance mechanisms

Human Rights Management Approach and Performance Indicators

HR1Total number and percentage of significant investment agreements and contracts that include human rights clauses or that underwent human rights screening

HR2

Total hours of employee training on human rights policies or procedures concerning aspects of human rights that are relevant to operations, including the percentage of employees trained

Employee Care ○ 50-51 100% of employees trained

HR3 Total number of incidents of discrimination and corrective actions taken ○ No such circumstances

HR4

Operations and suppliers identified in which the right to exercise freedom of association and collective bargaining may be violated or at significant risk, and measures taken to support these rights

HR5 Operations and suppliers identified as having significant risk for incidents of child labor

2014 Performance HighlightEmployee Care

○3147

77



HR6 Operations and suppliers identified as having significant risk for incidents of forced Employee Care ○ 54

HR7 Percentage of security personnel trained in the organization’s human rights policies Employee Care ○

51 54

Security personnel is divided into(1) Security guards: Trained

a c c o r d i n g t o r e g u l a r employee education and training procedures

(2) Secur i ty company s ta ff : Tra ined by the secur i t y company

HR8 Total number of incidents of violations involving rights of indigenous peoples ○ No such circumstances

HR9 Total number and percentage of operations that have been subject to human rights reviews

HR10 Percentage of new suppliers that were screened using human rights criteria

HR11 Significant actual and potential negative human rights impacts in the supply chain


△ 31

HR12 Number of grievances about human rights impacts filed Employee Care ○ 54 No such circumstances

Society Management Approach and Performance Indicators

SO1 Percentage of operations with implemented local community engagement

SO2 Operations with significant actual or potential negative impacts on local communities

SO3Total number and percentage of operations assessed for risks related to corruption and the significant risks identified

△

The company has an employee rotat ion pol icy in place. Any personnel who handle financial propert ies, cash, securi t ies, co l la te ra ls , and nego t iab le instruments are doing regular r o t a t i o n e v e r y t w o y e a r s . Furthermore, employee accounts are monitored for any abnormal transactions under the "Abnormal T r a n s a c t i o n M a n a g e m e n t System".

SO4 Communication and training on anti-corruption policies and procedures


○ 26

All new emploree and current s taff undergo per iod ic ant i -corruption and anti-competition t ra in ing . 100% o f s ta f f a re trained.

SO5 Confirmed incidents of corruption and actions taken2014 Performance Highlight

○ 26-27 No corruption incidents took place.

SO6 Total value of political contributions by country and recipient/beneficiary ○

The company i s po l i t i ca l l y neutral, andmakes no donat ions to any political party,individual, or government agency

SO7Total number of legal actions for anti-competitive behavior, anti-trust, and monopoly practices and their outcomes

○ No such circumstances

SO8 Monetary value of significant fines ○ No such circumstances

SO9 Percentage of new suppliers that were screened using criteria for impacts on society

SO10 Significant actual and potential negative impacts on society in the supply chain and actions taken

SO11 Number of grievances about impacts on society filed

Product Responsibility Management Approach and Performance Indicators

PR1 Product and service categories improved for health and safety

PR2

Total number of incidents of non-compliance with regulations and voluntary codes concerning the health and safety impacts of products and services during their life cycle

78


PR3 Product information required by procedures ○

All products and services adhere wi th not i f icat ion obl igat ions as ou t l i ned by superv i so ry organizations and regulations.

PR4Incidents of non-compliance with regulations and voluntary codes concerning product and service information and labeling


PR5 Results of surveys measuring customer satisfaction Customer Service and Commitment ○

36 40

PR6 Sale of banned or disputed products ○ No such circumstances

PR7 Incidents of non-compliance with regulations and voluntary codes concerning marketing communications, ○ No such circumstances

PR8Total number of substantiated complaints regarding breaches of customer privacy and losses of customer data


PR9Monetary value of significant fines for non-compliance with laws concerning the provision and use of products and services


○ 27

II.GRI Services Supplemental GuidanceReport Chapter Disclosure

Status Page Notes

Product Portfolio

FS1 Policies with specific environmental and social components applied to business lines

Commitment and Vision2014 Performance Highlight

○3

18

Established Corporate Social Responsibility Guidelines as ru les to implement matters relating to the environment and society.

FS2 Procedures for assessing and screening environmental and social risks in business lines


△24-25 27-29

Introduced the Jupiter Ecology Fund in 2008, with investment targets that encompass clean energy, green transportation, w a s t e t r e a t m e n t , w a t e r resources, ecological industries, environmental protection, and other topics.

FS3Processes for monitoring clients’ implementation of and compliance with environmental and social requirements included in agreements or transactions


△ 24-25

FS4Process(es) for improving staff competency to implement the environmental and social policies and procedures as applied to business lines

2014 Performance HighlightSocial Involvement

△ 24-25

FS5Interactions with clients/investees/business partners regarding environmental and social risks and opportunities


○8-16 31

FS6 Percentage of the portfolio for business lines by specific region, size and by sector

About Taishin2014 Performance Highlight

○

5 18

20-21

FS7 Monetary value of products and services designed to deliver a specific social benefit for each business line broken down by purpose

Customer Service and CommitmentSocial Involvement

○41

60-69

FS8Monetary value of products and services designed to deliver a specific environmental benefit for each business line broken down by purpose

2014 Performance HighlightCustomer Service and Commitment

○19 39

Launched the first environmentally friendly, carbon emission reducing, Green Life credit card in 2008

Same as FS2

79


Report Chapter Disclosure Status Page Notes

Audit

FS9Coverage and frequency of audits to assess implementation of environmental and social policies and risk assessment procedures


○24-25

30

The operat ions of the 2014 C o r p o r a t e S u s t a i n a b i l i t y Opera t ions Commi t tee are set out in in ternal audi t ing procedures.

Active Ownership

FS10

Percentage and number of companies held in the institution’s portfolio with which the reporting organization has interacted on environmental or social issues

○

Taishin Financial Holding has established Corporate Social Respons ib i l i t y Gu ide l ines , appl icable to al l subsidiary companies.

FS11 Percentage of assets subject to positive and negative environmental or social screening ○

No major assets obtained or disposed of in 2014.

FS12Voting polic(ies) applied to environmental or social issues for shares over which the reporting organization holds the right to vote shares or advises on voting

○ No such circumstances.

Community

FS13 Access points in low-populated or economically disadvantaged areas by type ○

AT M s a r e e s t a b l i s h e d i n convenience stores throughout Ta i w a n a n d P e n g h u m o r e b r a n c h e s a r e e s t a b l i s h e d in remote regions (such as Hualien).

FS14 Initiatives to improve access to financial services for disadvantaged people

Customer Service and Commitment ○ 41

Product and Service Labeling

FS15 Policies for the fair design and sale of financial products and services

Customer Service and Commitment ○ 35-44

FS16 Initiatives to enhance financial literacy by type of beneficiary

Social Involvement ○ 68-69

Note: FS2-4 disclosure status adjusted after taking Taiwan Stock Exchange Corporation Rules Governing the Preparation and Filing of Corporate

Social Responsibility Reports by TWSE Listed Companies into consideration.

III.United Nations Global Compact Comparison TableCategory Content of the 10 Principles Report Chapter Page

Human rights

Principle 1 Businesses should support and respect the protection of internationally proclaimed human rights; and

2014 Performance Highlight Employee Care

31 54-55

Principle 2 make sure that they are not complicit in human rights abuses. 2014 Performance Highlight Employee Care

31 54-55

Labor

Principle 3 Businesses should uphold freedom of association and effective recognition of the right to collective bargaining; Employee Care 54-57

Principle 4 the elimination of all forms of forced and compulsory labor; 2014 Performance HighlightEmployee Care 31、47、54

Principle 5 the effective abolition of child labor; and 2014 Performance HighlightEmployee Care 31、47、54

Principle 6 the elimination of discrimination in respect of employment and occupation. Employee Care 47、54

Environment

Principle 7 Businesses should support a precautionary approach to environmental challenges; 2014 Performance Highlight 32-34

Principle 8 undertake initiatives to promote greater environmental responsibility; and 2014 Performance Highlight 32-34

Principle 9 encourage the development and diffusion of environmentally friendly technologies. 2014 Performance Highlight 32-34

Anti-corruption Principle 10 Businesses should work against corruption in all its forms, including extortion and bribery. 2014 Performance Highlight 26

80

IV.ISO 26000 IndexCategory Core Subjects and Issues Related CSR Report Section Page

Organizational governance Decision-making processes and structures 2014 Performance Highlight 22-25

Human rights

Due diligence 2014 Performance HighlightEmployee Care

22-2731、4754-57

Human rights risk situations 2014 Performance HighlightEmployee Care

22-2731、4754-57

Avoidance of complicity 2014 Performance Highlight 22-27

Resolving grievances Employee Care 54

Discrimination and vulnerable groups Employee Care 54

Civil and political rights 2014 Performance Highlight17-34

79

Economic, social and cultural rights 2014 Performance Highlight 17-34

Fundamental principles and rights at work Employee Care 45-57

Labor practices

Employment and employment relationships Employee Care 47-49

Conditions of work and social protection Employee Care 45-57

Social dialogue Social Involvement 59-69

Health and safety at work Employee Care 54-57

Human development and training in the workplace Employee Care 49-51

The environment

Prevention of pollution 2014 Performance Highlight 32-33

Sustainable resource use 2014 Performance Highlight 32-33

Climate change mitigation and adaptation 2014 Performance Highlight 32-33

Protection of the environment, biodiversity and restoration of natural habitats 2014 Performance Highlight 75-76

Fair operating practices

Anti-corruption 2014 Performance Highlight 26-27

Responsible political involvement 2014 Performance Highlight 79

Fair competition 2014 Performance Highlight 26-27

Promoting social responsibility in the value chain 2014 Performance Highlight 31

Respect for property rights 2014 Performance Highlight26-27

31

Consumer issues

Fair marketing, factual and unbiased information and fair contractual practices

2014 Performance HighlightCustomer Service and Commitment

17-34 35-44

Protecting consumers' Health and safety2014 Performance HighlightCustomer Service and Commitment

17-34 35-44

Sustainable consumption2014 Performance HighlightCustomer Service and Commitment

17-34 35-44

Consumer service, support, and complaint and dispute resolution

Customer Service and Commitment 35-44

Consumer data protection and privacy2014 Performance HighlightCustomer Service and Commitment

37

Access to essential services 2014 Performance Highlight 17-34

Education and awareness Employee CareSocial Involvement

49-51 68-69

Community involvement and development

Community involvement Social Involvement 59-69

Education and culture Employee CareSocial Involvement

47-5168-69

Employment creation and skills development Employee Care 47-51

Technology development and access Customer Service and Commitment 35-44

Wealth and income creation 2014 Performance Highlight 20-21

Health Employee Care 56-58

Social investment 2014 Performance Highlight 17-34

81


V.Report Assurance Statement

82

83


84