Corporate Governance

1. Establishment of Integrity Management Policies and Programs

(1) Has the Company established an integrity management policy approved by the Board of Directors, clearly stating the policy and practices for ethical business conduct in internal regulations and external documents, along with a commitment from the Board and senior management to actively implement these policies?

Machvision has established the “Ethical Corporate Management Practice Principles” and the “Procedures for Ethical Management and Guidelines for Conduct,” explicitly requiring that all business activities be conducted in accordance with the principles of fairness, honesty, trustworthiness, and transparency. To implement our ethical business policies and prevent unethical behavior, the Company has set clear rules that all personnel (including subsidiaries) must follow in business operations:

1.  No one shall directly or indirectly offer, promise, request, or accept any improper benefits, nor engage in any behavior that is dishonest, illegal, or in breach of fiduciary duties to obtain or maintain advantages (“Unethical Conduct”).

2.  Employees shall not request or accept money, gifts, commissions, positions, services, preferential treatment, kickbacks, or other benefits in any form or under any name. Normal and occasional social etiquette that does not influence rights or obligations may be exempted.

3.  In terms of regulatory compliance, employees must comply with the Company Act, Securities and Exchange Act, Business Accounting Act, Political Donations Act, Anti-Corruption Act, Government Procurement Act, Conflict of Interest Prevention Act for Public Officials, relevant TWSE/TPEx listing regulations, and other applicable laws related to business conduct. Compliance forms the foundation of the Company’s ethical business practices.

4.  Senior management conducts business in accordance with the principles of integrity and aims to maximize value for shareholders and employees.

5.  Directors maintain a high level of self-discipline. For any board proposal in which they or the legal entity they represent have a conflict of interest that may harm Company interests, they shall express opinions and respond to inquiries only, and must not participate in discussion or voting. They shall also recuse themselves during such proceedings and shall not act as proxy for other directors. Directors are mutually self-disciplined and do not engage in improper reciprocal support.

No major differences

(2) Has the Company established a mechanism to assess the risk of unethical conduct, regularly analyze and evaluate business activities with higher risks of unethical behavior, and formulate prevention programs accordingly, covering at least the preventive measures specified in Article 7, Paragraph 2 of the “Corporate Integrity Management Best Practice Principles for TWSE/TPEx Listed Companies”?

(2) In the Company’s Code of Integrity Business Conduct and Procedures for Ethical Management and Guidelines for Conduct, specific rules are established for business conduct. For business activities with higher risks of unethical behavior, the Company strictly prohibits offering or accepting improper benefits, inappropriate charitable donations or sponsorships, and political contributions. (For details, please refer to the Company’s policies.)

1.  The Company conducts business in a fair and transparent manner. Before entering into transactions, the legitimacy and integrity records of agents, suppliers, customers, and other business partners are evaluated. Transactions with parties involved in unethical conduct are avoided. Contracts include clauses requiring compliance with integrity policies and allowing termination if unethical behavior occurs. The Company clearly prohibits any direct or indirect improper benefits, including kickbacks, commissions, facilitation payments, or other forms of illegitimate gains.

2.  To ensure compliance, the Company conducts regular employee training and awareness programs on integrity.

3.  Externally, a dedicated “Stakeholder Section” email and contact information are available on the corporate website for reporting and complaints. Internally, the “General Manager's Mailbox” is provided for major complaints to prevent violations.

4. To fully enforce these principles, not only employees but also suppliers must adhere to the Company’s ethical standards and culture. Suppliers are required to sign an “Integrity Commitment Letter” as a declaration of compliance.

No major differences

(3) The Company complies with all applicable laws and ethical standards, upholding transparency, integrity, and accountability in its operations. To ensure ethical conduct, we have established the “Code of Integrity Business Conduct,” “Procedures for Ethical Management and Guidelines for Conduct,” and a “Stakeholder Section,” along with confidential reporting channels.

Stakeholders — including customers, shareholders, government agencies, academic institutions, suppliers, employees, and the public — may report legal or ethical violations (such as fraud, bribery, or misconduct). Dedicated personnel follow up on reports, while senior management and the Audit Committee regularly monitor case handling to ensure fairness and transparency.

No major differences

2. Implementation of Ethical Business Practices

(1) Does the Company assess the integrity records of counterparties and include integrity clauses in contracts signed with them?

(2) Does the Company designate a dedicated unit under the Board of Directors to promote ethical business practices, and report at least annually to the Board on the implementation of integrity policies, anti-corruption measures, and related supervision results?

(2) The Company has designated the Administrative Center as the dedicated unit responsible for promoting ethical business practices and serving as the consultation channel for integrity-related issues. When any suspected violation occurs, a cross-department review meeting is convened. Significant cases are reported to the Audit Committee or the Board of Directors in accordance with relevant laws and internal procedures.

An annual report on execution status is submitted to the Audit Committee or the Board.
The report for this year was presented on December 19, 2024.

The principal duties include:

1. Assisting in incorporating integrity and ethical values into the Company’s business strategies, and establishing anti-corruption measures in accordance with relevant laws and regulations.

2. Formulating programs to prevent unethical conduct, and setting standard operating procedures and conduct guidelines for related business activities.

3. Planning organizational structure, staffing, and responsibilities, and implementing control and supervisory mechanisms for business activities with higher risks of unethical behavior.

4. Promoting and coordinating training and communication related to integrity policies.

5. Establishing and ensuring the effectiveness of a whistleblowing system.

6. Ensuring the internal audit unit conducts independent audits according to the audit plan to assess the effectiveness of anti-corruption measures. Business units shall periodically evaluate compliance within their operations, and the responsible unit shall consolidate and report the results.

(3) Does the Company establish a conflict-of-interest policy, provide appropriate reporting channels, and ensure effective implementation?

(3) For matters related to conflicts of interest, employees may report to their direct supervisor, or directly to the General Manager's mailbox.

(4) To ensure ethical business conduct, has the Company established effective accounting and internal control systems, and does the internal audit unit develop audit plans based on the assessment of unethical-conduct risks to verify compliance with anti-corruption programs, or engage external auditors to perform such audits?

(4) The Company has established effective accounting and internal control systems, and has formulated an internal audit plan. The internal audit unit conducts audits in accordance with the plan, and performs special audits when necessary in response to specific circumstances.

(5) Does the Company periodically conduct internal and external training on integrity and ethical business practices?

(5) The Company promotes integrity principles through weekly management meetings and quarterly gatherings, ensuring employees understand the ethical guidelines. In addition, relevant training sessions and seminars are held periodically.On August 15, 2024, the Company held an internal training session titled “Supplier Audit Operations” (0.5 hours) for procurement department managers and employees who frequently interact with external suppliers.

       The training also covered the Company's integrity principles and anti-corruption commitments, reminding employees of key compliance requirements when conducting business activities. Participants were clearly instructed to refrain from any conduct that violates integrity or involves unlawful behavior.

3. Operation of the Whistleblowing Mechanism

(1) Does the Company establish a concrete whistleblowing and reward mechanism, provide convenient reporting channels, and assign appropriate personnel to handle cases involving reported parties?

(1) The Company has established the “Procedures for Handling Reports of Illegal, Unethical, or Dishonest Conduct” to handle reporting matters. Reports may be submitted through in-person reporting, telephone reporting, or written submissions. Reports from shareholders, investors, and other stakeholders are handled by the spokesperson, while reports from internal employees, customers, and suppliers are handled by the head of internal audit.

(2) Does the Company establish standard operating procedures for handling and investigating whistleblowing cases, define follow-up actions after investigation, and implement confidentiality mechanisms?

(2) Procedures for Handling Whistleblowing Cases:

1. Anonymous Reports:
Anonymous reports are generally not processed; however, if the reported content is deemed necessary for investigation, a case may still be opened and used as internal reference.

2. Identified Reports:
The responsible unit shall verify the intent and evidence provided. If there is reasonable suspicion of illegal, unethical, or dishonest conduct, the case and supporting evidence shall be submitted to the General Manager for handling.

3. Confidential Processing:
The Company shall handle all whistleblowing cases confidentially and conduct verification through independent channels. The identity of the whistleblower will be strictly protected.

4. Protection for Employees:
The Company guarantees that employees who file reports will not be subjected to improper treatment or retaliation as a result of their whistleblowing.

5. Right of Response:
To protect the rights of the accused party and avoid retaliatory actions, the Company shall provide an opportunity for response, and when necessary, convene a personnel review committee to conduct a hearing.

(3) Does the Company take measures to protect whistleblowers from improper treatment as a result of their reports?

(3) To strengthen an integrity-driven corporate culture and protect whistleblowers, the Company established a “Whistleblower Protection Channel and Procedures,” approved by the Board on May 4, 2021, in line with its “Ethical Corporate Management Practice Principles”.

4. Enhanced Information Disclosure

(1) Does the Company disclose the contents of its “Ethical Corporate Management Practice Principles” and related implementation results on its website and the Market Observation Post System (MOPS)?

5. Differences from TWSE/TPEx Integrity Management Code

The Company has established its own Integrity Management Code and Procedures and Guidelines for Integrity Management, and there are no material differences between the Company’s practices and the “Regulations for Integrity Management of TWSE/TPEx Listed Companies.”
The Company has established its own “Ethical Corporate Management Practice Principles” and “Procedures for Ethical Management and Guidelines for Conduct,”, and there are no material differences between the Company’s practices and the “Regulations for Integrity Management of TWSE/TPEx Listed Companies.

6. The Company upholds integrity principles in all dealings with business partners and actively communicates its commitment to ethical conduct to suppliers.
We conduct business with suppliers based on integrity and actively promote ethical practices across our supply chain.