The Evolution Path of the Sustainable Development Action Plan for Listed and OTC-traded Companies (Taiwan)

• The Taiwan Stock Exchange (hereinafter, the "TSE") and the Taipei Exchange (hereinafter, the "TPEX") will explore the sustainability indicators that should be disclosed for each industry.


• A working group will be set up to compare the differences between the IFRS sustainability disclosure guidelines and existing domestic sustainability regulations, create sample examples, and seek harmonization.  Public hearings will be conducted to solicit public comments and develop a timetable for promoting sustainability in Taiwan.


• The TSE and the TPEX will formulate the standards for the quality review on sustainability report verification agencies and the measures for addressing deficiencies.

• The TSE and the TPEX will randomly inspect the sustainability reports of companies and provide recommendations.


• Review reports issued by the TSE and the TPEX on sustainability reports will be posted periodically on the websites of the TSE and the TPEX.


• The TSE and the TPEX will indicate the points to note for preparing a sustainability report in annual evaluations, board and supervisory meetings, or business promotion meetings.

• The TSE and the TPEX will formulate the standards for the quality review on sustainability report verification agencies and the measures for addressing deficiencies.

• The TSE will consider the digital production function of sustainability reports.

• The TSE will consider the format of relevant ESG reporting information and separately gather domestic and overseas information to enhance the content of the database.


• The TSE organizes seminars to engage in collaborative discussions with external parties on the ESG evaluation framework and the content of its indicators.

• The FSC plans to amend the Regulations Governing Information to be Published in Annual Reports of Public Companies, while the TSE and TPEX plan to revise the Operating Guidelines for the Preparation and Filing of Sustainability Reports by Listed and OTC-traded Companies.  Such regulations will incorporate the disclosure of carbon reduction goals, strategies, and action plans for 2030 into the corporate governance evaluation indicators.

• The TSE and the TPEX are considering the feasibility of requiring verification for sustainability indicators.


• The TSE and the TPEX should randomly inspect the worksheets of verification agencies to determine if the verification procedure meets the requirements.

• The pilot run of the digital platform of sustainability reports will be conducted.

• The TSE will consider if it is necessary to gradually expand the content of the ESG database in line with practical circumstances, based on its research findings.


• The TSE will conduct promotional events to explain ESG evaluation to listed and OTC-traded companies.


• The TSE will collect domestic and overseas data to explore the feasibility of integrating the cross-organization ESG information in a digital platform.

• A listed or OTC-traded company with a paid-in capital of less than NT$2 billion is required to prepare sustainability reports from 2025 onwards.


• All listed and OTC-traded companies are required to disclose sustainability indicator information about their industries.


• The TSE and the TPEX will explore the feasibility of expanding the scope of sustainability indicator verification to all industries.

• The digital platform of sustainability reports will go online.

• The TSE will promote ESG evaluation, depending on the status of its international development.


• The TSE and the TPEX are considering the creation, release, promotion, and utilization of indexes related to the ESG theme.


• The TSE will set up a single platform for ESG product information based on its research findings.

• The TSE and the TPEX will take into account international standards and consider domestic industry characteristics in establishing the proposed disclosure requirements for Scope 3 (such matters in Scope 3 as greenhouse gas emissions generated from upstream and downstream transportation and distribution, employee commuting, business travel, etc.)

• The FSC will strengthen its cooperation with the Environmental Protection Administration by accommodating the agency's planning and supervising the TSE to provide its securities trading experience and help the agency establish a voluntary greenhouse gas reduction quota trading mechanism.

• The TSE and the TPEX are exploring the feasibility of the compulsory disclosure for Scope 3.

• The carbon reduction targets, strategies, and specific action plans for listed or OTC-traded companies will be set in phases based on their capital size, and listed and OTC-traded companies are required to disclose, by the year after the company's inventory information is reported in the consolidated financial report at the latest, the carbon reduction targets, strategies, and specific action plans based on the year when the inventory is checked as the record year.

Development of sustainable development bonds

• The TPEX will establish an electronic online application system for recognizing the qualifications for sustainable development bonds.


• The TPEX will consider international sustainable development trends and market demands in exploring the feasibility of expanding the scope of sustainable development bond market products (such as green economy corporate bonds/climate-related bonds, and other new types of sustainability bond products).

• The amendments to Article 14-4, Article 14-5, and Article 178 of the Securities and Exchange Act concerning the powers and responsibilities of an audit committee will be explored.  The highlights include: (1) the audit committee shall reach consensus when bringing lawsuits against directors, calling shareholders' meetings, and engaging in transactions on behalf of the company; (2) in case the audit committee cannot convene for any reasons, matters that should be submitted to the audit committee for deliberations shall be decided by a special resolution adopted by all the directors of the board.  In addition, independent directors of the audit committee, based on their role as members of the audit committee, should still provide their concurring opinions on financial reporting matters before such matters may be submitted to the board meeting for a special resolution, and provisions regarding relevant penalties should be added.

• The amendment to Article 43-1 and Article 183 of the Securities and Exchange Act, lowering the declaration and announcement threshold for majority shareholding to 5%.

• The FSC will revise annual report guidelines; and the TSE and the TPEX will amend the key matters and related regulations that shall be followed for the establishment and exercise of the board of directors of listed or OTC-traded companies, specifying that companies applying for IPO should appoint at least one female director.

• The FSC issued a circular to request OTC-traded companies to adopt a candidate nomination system.

• The TSE will include the linkage between the compensation of top management and ESG performance in corporate governance evaluation indicators.


• The TSE and the TPEX will study the feasibility of compelling the reporting of directors' remuneration to the shareholders' meeting.

• It is promoted that a listed or OTC-traded company should appoint at least one female director upon expiration of the directors' term.

• It is explored that if the seats of female directors of a listed or OTC-traded company do not reach one-third of the total seats of directors, the reasons and measures to be taken should be specifically disclosed in its annual report.

• The TSE is considering the inclusion of the requirement that the term of independent directors shall not exceed three terms in the corporate governance evaluation indicators.

• It is promoted that the directors of a listed or OTC-traded company should be elected through a candidate nomination system.

• The TSE and the TPEX are exploring the feasibility of compelling a listed or OTC-traded company to set up a sustainability committee.

• It is promoted that all listed or OTC-traded companies shall ensure that the seats of independent directors shall account for at least one-third of the total seats of directors upon expiration of the directors' tenure.


• It is promoted that independent directors of all listed or OTC-traded companies shall not serve over three terms.