The People Behind Your Device: Corporate Governance at ASUS

Oct 04, 2024

When you pick up your ASUS device, you interact with a product born from a complex and well-structured governance system that ensures quality, innovation, and sustainability. This system is shaped by ASUS leadership and corporate governance policies. Below, we share details about the corporate governance framework of ASUS and show how it influences the company's operations and the products you use daily.

Corporate governance at ASUS is rooted in the values on which the company was built: humility, integrity, diligence, agility, and courage. These principles guide both the everyday of ASUS employees at all levels and the governance framework, which aims to safeguard the rights and interests of various stakeholders, including employees, customers, and investors.

To maintain top standards of governance, ASUS adheres to its Best Practice Principles of Corporate Governance. These principles are in line with the guidelines provided by the Corporate Governance Best Practice Principles for companies listed on Taiwan Stock Exchange Corporation (TWSE) and GreTai Securities Market (GTSM) — a standard set out for corporations in Taiwan, where ASUS headquarter is located — and international governance standards set by the Organization for Economic Cooperation and Development (OECD). The scope of these principles is comprehensive, covering everything from shareholder rights to board functions, supervisory roles, stakeholder interests, and transparency.

At the core of the ASUS governance structure is the Board of Directors — a group that is crucial in driving the company's strategic direction and ensuring operational efficiency. The Board is characterized by its diversity, professionalism, and commitment to high efficiency and transparency. These attributes are critical in making well-rounded decisions that consider various perspectives.

At the moment, the ASUS Board of Directors consists of 15 members, including five independent directors and two female directors. This diversity is not just about representation — it reflects the board's broad range of expertise in areas like business management, financial analysis, and international markets. By including independent directors (one-third of the Board), ASUS ensures that external perspectives are considered, which is vital for robust and unbiased decision-making.

To maintain the highest standards of governance, ASUS has set out an average attendance rate requirement for the Board members. This commitment to participation underscores the importance of active and engaged leadership. Moreover, the board follows strict protocols to avoid conflicts of interest, ensuring that decisions are made in the best interest of the company and its stakeholders.

ASUS has a well-defined remuneration policy for its directors and managers, linking compensation with company performance and future risk management. The policy is designed to attract and retain top talent by offering competitive compensation that aligns with industry standards. However, it’s not about financial rewards only — remuneration is closely tied to the company's overall performance, individual contributions, and risk management efforts.

Starting at the very top level, from 2023 on, the variable renumeration of ASUS Co-CEOs is linked to performance of the company in the field of sustainability. The criteria for evaluation include the achievement rate of the RE100 targets, as well as SBT emissions reduction targets. These influence the variable bonus by up to 10%.

For the Board of Directors, the ASUS Articles of Incorporation stipulate that compensation is based on their participation and contribution, irrespective of the company’s profit or loss. Additionally, ASUS practices profit sharing — where a portion of the company’s annual profit is distributed to the Directors as a part of their compensation, reflecting their crucial role in the company’s success. In 2023, the allocation was set at 0.3% of the year’s profit.

On the other hand, to enhance sustainability as a company goal the remuneration variable of ASUS co-CEOs are linked to the company’s sustainability performance in 2023. Assessment metrics include achievement rates of ASUS’s global operations’ RE100 (100% Renewable Energy) target and SBTi emission reduction targets. These indicators can potentially influence a 10% increase or reduction on the co-CEOs’ variable remuneration.

The performance of the Board itself is also regularly evaluated. ASUS conducts self-evaluations of the Board and its functional committees at least once a year to ensure continuous improvement in governance and operational efficiency. Additionally, every three years, an external evaluation is conducted by an independent institution, which provides insights and recommendations for further improvement.

To further strengthen governance, ASUS has established several functional committees, including the Audit Committee, the Remuneration Committee, and the Business Continuity Management (BCM) Committee.

The Audit Committee, composed of independent directors, plays a critical role in overseeing the company's financial reporting and internal controls. This committee ensures that ASUS adheres to the highest standards of financial integrity and transparency.

The Remuneration Committee, as mentioned earlier, is responsible for overseeing the company’s compensation policies. It ensures that the remuneration structure is fair, competitive, and aligned with the company’s long-term goals.

The BCM Committee, a relatively new addition to the ASUS governance structure, focuses on identifying and managing risks that could potentially disrupt business operations. This committee has been instrumental in strengthening the company’s risk governance framework, especially by involving independent directors in the risk management process.

In addition to its robust corporate governance structure, ASUS places a strong emphasis on sustainability. Sustainability and Green Quality Management Center plays a pivotal role in integrating sustainability into the company’s operations. Led by the Chief Sustainability Officer (CSO), this unit monitors global sustainability trends and ensures that ASUS policies and actions align with these trends.

The CSO regularly reports to the Board of Directors, providing updates on sustainability policies, key projects, and performance metrics. This ensures that sustainability is not just an add-on but is deeply embedded in the ASUS culture. The four main sustainability goals are driving ASUS’s corporate strategy are Climate Action goals, Circular Economy goals, Responsible Manufacturing goals, and Value Creation targets. Aligned with the United Nation’s (UN) Sustainable Development Goals (SDGs), these are a compass for the ASUS sustainability officers to determine the direction for the company and judge its sustainability performance.

To facilitate cross-functional collaboration on sustainability issues, ASUS has established the GreenASUS & SERASUS Management Committee, as well as the ESG Committee. These groups bring together representatives of various business units to address sustainability challenges and opportunities, ensuring that the company moves in an ever more sustainable direction in a unified and strategic manner.

The devices you use from ASUS are more than just products of advanced technology — they are the results of the everyday committed efforts of ASUS employees, as well as a meticulous corporate governance structure that emphasizes integrity, efficiency, and sustainability. The Board of Directors, functional committees, and sustainability governance framework work together to ensure that ASUS not only meets its business objectives but also upholds its responsibilities to stakeholders and the environment.

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