Sustainable Management

Corporate Governance Structure and Committee

THSRC firmly believes that thought-out, transparent, and efficient corporate governance is the foundation for pursuing steady development, continuously improving operational safety and sustainable performance, and further creating sustainable value. The Company complies with domestic laws and regulations to establish the "Corporate Governance Guidelines," and has established the Board of Directors and various functional committees under it to optimize the overall governance effectiveness of the Company through various management mechanisms.

THSRC has established a "Corporate Governance Promotion Committee" to promote relevant issues through its corporate governance planning team, sustainable development team, and ethical management team. The main issues discussed in 2022 covered the implementation status of human rights management, corporate governance, sustainable development, ethical management, information security management and system, legal compliance, and risk management. Additionally, the committee presented reports on investor relations enhancement plans and strategic planning for material corporate governance matters. For more information on the responsibilities of the "Corporate Governance Promotion Committee" and its operations in 2022, please refer to “Corporate Governance Structure.”

THSRC makes efforts to promoting corporate governance systems and measures and has been ranked among the top 5% of listed companies in the "Corporate Governance Evaluation" for five consecutive years. In the future, THSRC will continue to execute its corporate governance framework, actively implement communication with stakeholders, and practice rigorous corporate governance strategies. For further information related to corporate governance, please refer to the “ Corporate Governance Structure” and THSRC's annual reports, corporate website and the Market Observation Post System (MOPS).

Corporate Governance Structure
Responsibilities of the Board of Directors and Information on Board Members

The Board of Directors serves as THSRC's highest governing body. Its main power and responsibilities include the power conferred by relevant laws and regulations, and the shareholders' meeting, reviewing significant regulations, business plans, budgets, financial statements, and important business, as well as supervising management execution results and guiding the management team. THSRC strives for board diversity which include industrial, academic, and legal professional backgrounds. Currently, there are 13 directors (including 4 independent directors) on the Board, of which male directors accounted for 85% (11 persons) and female ones accounted for 15% (2 persons). The age distribution is as follows:

Functional Committees

FIn order to effectively perform the competencies of the Board of Directors and elevate the caliber of its decisions, functional committees have been set up under THSRC's Board of Directors, including the "Corporate Governance & Nomination Committee," "Audit Committee," "Remuneration Committee," and "Special Committee." These committees aid the Board of Directors in fulfilling its supervisory and advisory duties by organizing meetings to execute the responsibilities mandated by regulations, deliberating pertinent matters, and presenting conclusions and recommendations to the Board of Directors for resolution. Please refer to the table below for the description of each functional committee's responsibilities and the issues discussed in 2022. For further information on operations, please refer to “Operations of Functional Committees.”

2022 Financial Results

In the first half of 2022, due to the impact of the epidemic, THSRC experienced a decline in operating income. In the second half of the year, with the government's epidemic coexistence policy, the public confidence in riding the high-speed railway has continued to increase, the number of tourists has steadily recovered, and the operating income has also increased, smoothly weathering the financial impact of the epidemic, demonstrating the company's resilience. On the basis of sustainable operation, THSRC continues to optimize its financial structure and corporate governance performance. Since it was listed on the stock market, it has been included in the MSCI Taiwan Index, the FTSE TWSE Taiwan 50 Index, the TWSE Corporate Governance 100 Index, and the TWSE RA Taiwan Employment Creation 99 Index, and the FTSE4Good Emerging Index as a constituent stock. In 2022, it was once again selected as a constituent stock of the "FTSE4Good TIP Taiwan ESG Index" and was awarded an exclusive badge certificate. This has demonstrated that THSRC is committed to improving its performance in sustainable development.

Performance Highlights

  • In 2022, THSRC's annual revenue was NT$37.1 billion, with a net income after tax of NT$3.77 billion. This year's growth in travelers is still affected by the COVID-19 pandemic, but the impact is not as severe as in 2021, with revenues and earnings increasing by 22.8% and 4.4% respectively compared to 2021.
  • In the current year, the Company continued to take measures to reduce the cost of capital to cope with the trend of rising interest rates, and the annual interest expense was NT$6.23 billion.

Action Plan

  • Early repaid the principal of Tranche A Facility under a syndicated loan project in the amounts of NT$25 billion in May 2022 to save interest expenses.
  • Issuance of a guaranteed commercial paper of NT$7 billion in May 2022 linked to ESG indicators to provide stable and low-interest funds for the company, thereby creating greater benefits for shareholders.
  • The Company issued 3-year unsecured corporate bonds in 2021. The bonds were recognized as sustainable development bonds, and the funds raised were invested in the green investment plan of “Construction of Automation Equipment of Yan Chao Main Workshop”; and the social benefit investment plan of “Station Passenger Information System Update”.
  • The "Station Passenger Information System Renovated" has completed all the projects of the eight stations of the high-speed railway in 2022, providing passengers with more real-time and convenient travel information while in the high-speed railway stations, and improving the safety and convenience of passengers' transportation when riding on the high-speed rail; "Construction of Automation Equipment of Yan Chao Main Workshop" is currently in the construction stage. The pollution prevention and control, affordable basic living facilities and other categories invested in this plan will support enterprises to implement sustainable business concepts and policies, and their projects will have a positive impact on environmental protection, the overall image of the company and long-term operation and development, and effectively promote and implement the sustainable concept of THSRC.

Industry Exchange

Taiwan High Speed Rail Corporation (THSRC) has been actively responding to international industry trends through technical visits, international observation, and industry academia cooperation, and has continued to refine the technology of the rail industry. Among them, THSRC has been a member of 21 associations (refer to Appendix Table 1), maintaining close cooperative relationships with domestic and foreign rail industry group and promoting its development. Since THSRC joined the International Union of Railways (UIC) as a member in 2009, it has been exchanging experiences with railroad systems or operating organizations around the world by co-organizing seminars. THSRC continues to participate in the International High-Speed Rail Association (IHRA) as a member and actively supports the seminars and forums held by the association. In October 2022, THSRC was invited to be a panelist at the annual forum of the International High Speed Rail Association (IHRA) in Japan, and shared Taiwan's sustainable development with the global railway transportation industry.

THSRC Industry Associations Participation in 2022
Industry Association Participated Description
International Union of Railways (UIC) Exchange and collaboration with international railway operators
International High Speed Rail Association Exchange and collaboration with international high-speed rails
Chung-Hwa Railway Industry Development Association Development and promotion of the railway industry
Chinese Institute of Transportation Development and promotion of the railway industry
Rail Engineering Society of Taiwan Development and promotion of the railway industry
Supply Management Institute, Taiwan Exchange in procurement-related expertise and participation in related courses
Taiwan Railway Economy Development Association Development and promotion of the railway industry
Chinese Society for Quality Exchange in quality management and participation in related courses
Taiwan Visitors Association Tourism development and business promotion and exchange
Intelligent Transportation Society of Taiwan Development and promotion of the transportation industry
Chinese Institute of Engineers Exchange and promotion of civil engineering technology
Taiwan Stock Affairs Association Exchange in stock affairs-related expertise and regulatory advancement
Taiwan Corporate Governance Association Development and exchange in corporate governance
The Institute of Internal Auditors - Chinese Taiwan Development and promotion of internal audit
Computer Audit Association Development and exchange in corporate governance
Association of Industrial Relations, R.O.C. Development of labor relations and participation in regulatory courses
Accounting Research and Development Foundation Exchange and promotion of accounting business
Taiwan Railways Tourism Association Development of railway tourism and business promotion and exchange
Chinese East Asia Economic Association Tourism development and business promotion and exchange
Chinese Society of Mechanical Engineers Development and promotion of the railway industry
Center for Corporate Sustainability -
Taiwan Institute for Sustainable Energy
Development and promotion of sustainability

Local Industry-Academia Cooperation

THSRC collaborated with 27 universities and colleges in 2022 to promote industry-academia cooperation measures. These measures included joint internship programs, railway equipment laboratory, and memorandum of industry academia cooperation. By sharing rich industrial experience and providing perfect railway service training, THSRC created opportunities for young students to explore the railway transportation industry. As part of this effort, 54 students were provided with one-year station staff internship opportunities through the academic year internship program. Additionally, THSRC worked with National Taipei University of Science and Technology, National United University, and Asia Eastern University of Science and Technology to jointly promote maintenance internship programs. In total, 10 students were admitted for cultivation.