1. Implement corporate governance

Based on issues such as corporate governance, economy, environment, and society, the company faces business trends in the future. Since 2015, the Finance Department has been used as a part-time unit to promote sustainable development. In 2022, the "China Fiber Corporation Sustainable Development Promotion Group" was established. , is responsible for supervising the implementation of the company's sustainable development policies, systems or related management guidelines. The chairman serves as the convener to manage related affairs, and assigns the general manager to serve as the deputy convener. The four working groups, namely, personnel and personnel, are respectively assigned by relevant units to jointly carry out the work on sustainable development issues and complete the preparation of the sustainability report.

In order to establish a sound sustainability report preparation mechanism, the company formulated the "Sustainability Report Preparation and Verification Operation Procedure" in November 2022. This operation procedure was approved by the Audit Committee and approved by the Board of Directors, and incorporated into the internal control system. And submit the sustainability report preparation and verification results to the board of directors every year.

2. .Fostering a Sustainable Environment

(1) In an effort to cut down on paper consumption, the company has started using recycled paper and implemented online approval of internal operations. Staff members are expected to bring their own drinking containers. Some of the treated wastewater is recycled and re-used after purification treatment at the wastewater treatment facility.

(2) The environmental impact mainly comes from the Company's manufacturing processes, and the chimney of the cogeneration plant has a 24-hour exhaust gas monitoring device which is connected to the Department of Environmental Protection in order to jointly monitor the emissions quality. An environmental quality monitoring system (DAS) has been installed within the plant facility to scan for potential sources of leakage from manufacturing processes that have hazardous gases.

 (3) Environmental management dedicated units, for the company's management department and factory work safety classes.

(4) Due to climate change, the company has identified pertinent potential risk factors, improvement opportunities, and measures, as well as the need to make adjustments to operational activities. One such modification is the installation of electrostatic precipitators/sulfur and nitrate removers and exhaust systems on coal-fired boilers to ensure exhaust quality meets national standards. To recycle and reuse waste heat, an air-preheater is installed on the boiler’s inlet surface. The wastewater factory developed the wastewater treatment and recycling system to significantly reduce water usage. A reactive afterburner has been installed within the manufacturing processes to reduce odor dissipation of VOC (volatile organic matter) and the impact on the environment.

         III.  Preserving Public Welfare

(1)The company endorses adherence to fundamental principles for personnel, including “Universal Declaration of Human Rights,” “ICCPR and ICESCR,” “The United Nations Global Compact” and “ILO Declaration on Fundamental Principles and Rights at Work.” Employee work rules have been established, and applicable labor law and regulations are adhered to in order to protect employees’ legal rights and establish and implement appropriate management methods and procedures.     

The Company’s human rights management and concrete plan summary as follows:

Human　rights management policies	Concrete plan
Provide a safe and healthy working environment   Assist employees to maintain physical and mental health and work efficiency	• Established safety and health policy to guarantee employees and related process personnel’s safety and health. • One hour lunch break to give sufficient resting time for employees. • Regular and irregular health examinations for employees are arranged to maintain employees' health.
Prohibit forced labor, abiding with the government’s labor act.	Implement the leave system, encourage employees to value work life balance.
Established the “Standard for Supplier Corporate Social Responsibility” requesting suppliers to sign and commit.	From the human rights, legal compliance, and environment aspects, and under the principles of timely, appropriate value, appropriate volume, and appropriate price, prioritize suppliers who adopt TOSHMS, OHSAS 18001, and so forth occupational safety, energy and environmental management systems. We hope to work with partners in committing to the duties of corporate social responsibilities together.

(2) Employees’ remuneration

The company’s salary policy is in line with the provisions in the labor regulations. It has a performance appraisal system in place that annually evaluates employee performance in relation to pre-determined work goals and their personal contribution. Provide employees with a reasonable salary and bonus structure. If the company has generated annual profits, 1%~5% of those profits should be allocated to employee compensation. The distribution of retirement funds shall be prescribed by law.

(3) Occupational Safety and Health Policy

The OHSAS 18001 international standard serves as the basis for the company’s safety and health management system, which prioritizes the safety and health of its workforce in order to reduce employees’ health and safety risks. To demonstrate the company’s commitment to continuous improvement and sustainable operations, and to ensure the health and safety of employees and other operators, an occupational safety and health policy has been established.

There were eight workplace accidents in 2022, affecting a total of 8 workers (accounting for 1.22 % of the total number of employees).

Relevant Improvement Measures

1.  Workplace equipment related deficiencies: Improve and implement onsite inspection in the operational environment.

2.  The industrial safety accident unit proposes specific improvement measures and develops hazard identification and risk assessment in accordance with ISO-45001.

3.  Advocacy for workplace safety and SOP education training for operating potentially dangerous machinery and equipment.

Work safety audit

The Company has established the annual work safety internal audit work plan. The factory director will act as the chief convener.  The work safety audit team will compile the audit suggestions and improvement matters and specific improvement situations of the various audit reports and enter them into the “internal audit system.” Each unit will have to conduct the follow-up and improvements. Every quarter, the unit will review deficiencies at the Safety and Health Management Meetings based on the audit suggestions and improvement matters.

Work safety audit process

Daily irregular patrol inspection

Firefighting equipment practice and drills every quarter

General inspection of large size public hazardous materials twice every year

Equipment safety management

To ensure the safe operations of equipment, the company performs equipment grading, compiles a list of potentially hazardous machinery and equipment and conducts exhaustive inspections. Establish rules for the use of personal protective equipment in the workplace so that employees can wear equipment correctly to enhance operating safety. Employees are also regularly provided with safety education and training.

Certifications:

The Company’s plant area has obtained ISO 45001 certifications.

(4)The company offers internal and external vocational training for its supervisors and employees at all levels, including education training for new hires, ongoing training for employees and talent training for supervisors, among others. Employees are encouraged to evaluate their interests, expertise, values and career objectives and to share this information with their managers in order to facilitate future career planning.

IV.  Strengthen information disclosure

On the Company's website, we disclose our contributions to the community and our participation in activities.

V.  The Company implement the risk assessment of environmental, social, and corporate governance issues related to corporate operation and establish relevant risk management policies or strategies based on the principle of materiality：

1.The disclosed information addresses the company’s ESG-related key issues and performance at key locations from January to December 2022. The Taipei office and Kaohsiung factory of China Man-Made Fiber Corporation are included in the company’s risk assessment boundary.

2. Perform an analysis based on the materiality principle, consult with internal and external stakeholders and review and integrate evaluation data from various departments to identify major issues and propose relevant corresponding risk strategies.

3. Establish related risk management policies or strategies for the risk from assessment:

Major issues	Risk assessment items	Remark
Environment	Environmental impacts and management	The Company has effectively lowered the pollution emissions and its impacts to the environment through implementing manufacturing safety management and systemized management circulation. Since obtaining the ISO 50001certification for environmental and energy management in 2018, the company has continued to obtain certifications periodically. Establish measures for the prevention and regulation of harmful gases, install equipment that can reduce emissions in the discharge flue and install a continuous monitoring system capable of transmitting detected values at any time to the control room and government monitoring center. To conserve precious water resources, the waste water field cleans and treats the wastewater from the entire factory area before it is recycled and used again. Create a greenhouse gas inspection management system in accordance with the ISO14064-1 inspection guide and continue to implement carbon reduction strategies based on the inspection findings. Annual planning of internal audit plan for all relevant environmental laws and regulations that the Company needs to comply with, and audit various work procedures for compliance.
Society	Occupational safety	Plant area completed the “ISO45001 Occupational health and safety management system” certification. Regular organization of fire drills and safety educational training once a year, cultivating employees emergency response and self-management in safety capability.
	Product safety	The company has obtained the Oeko-Tex Standard 100 textile (yarn) harmful substance safety certification. Its primary objective is to test the harmful substances of textile in order to ensure its safety. The most extensively used eco-label for textiles at present is Oeko-Tex Standard 100.
Corporate Governance:	Society, economics and legal compliance	The company ensures compliance with applicable laws and regulations by establishing a governance structure and implementing an internal control mechanism.
	Enhance the directors’ function	1. Plan related further education topics for the directors. Each year provide the directors the latest laws and regulations, system development and policies.  2. Purchase liability insurance for the directors to protect from litigation or compensation situations.
	Communicated with interested parties	1. The members of the “sustainable development team” identify the key stakeholders based on the characteristics of the industry, their daily operations, experience in their industry and interactions with stakeholders, as well as their level of concern and impact on the company’s operations. A communication channel that facilitates prompt responses and streamlines channels to improve efficiency. 2. Establish mailbox for the investors with the assignment of the spokesman to answer to the investor.