Committees
Audit Committee
Remuneration Committee
Committee Member
Audit Committee
Audit Committee Meeting Status
Audit Committee’s authority and key tasks of the year:
- Establish or amend the internal control system in accordance with Article 14-1 of the Securities and Exchange Act.
- Evaluate the effectiveness of the internal control system.
- Establish or amend the procedures for significant financial activities, including obtaining or disposing of assets, engaging in derivative transactions, loaning funds to others, or providing others with endorsement or guarantees in accordance with Article 36-1 of the Securities and Exchange Act.
- Handle matters involving the directors’ interests.
- Carry out material asset or derivative transactions.
- Loan significant funds or provide endorsement or guarantee to others.
- Raise, issue, or privately raise securities with equity nature.
- Appoint, dismiss or remunerate certified public accountants (CPAs).
- Appoint or dismiss the heads of finance, accounting, and internal audit.
- Annual Financial report signed by the Chair, Supervisors and Accounting Officer, and second quarter financial report, which requires certification by a CPA.
- Other major matters stipulated by the Company or competent authorities.
In the year of 2023 and up to the date of publication of the annual report, the 1st Audit Committee met 1 time.
Title Name Attendance in Person By Proxy Attendance Rate in Person (%) Notes
Convener Weichi Hsu 1 0 100% None
Member Robert Tseng 1 0 100% None
Member Linus Chiu 1 0 100% None
Other statutory information:
- If any of the following circumstances have occurred during the operation of the Audit Committee, specify the date, period, case content, resolution of the Audit Committee meeting, and the handling of the opinions of the Audit Committee by the Company:
- Items listed in Article 14-5 of the Securities and Exchange Act:
Date of Meeting / Session Content of Proposal Result Response to Opinions of Audit Committee The 1st Meeting of 1st Audit Committee 2023.12.26 1. Election of the convener of the 3rd Audit Committee of the company All the members present elected Weichi Hsu as the convener of the current Audit Committee The resolution was submitted to and approved by the Board of Directors of the Company 2. Approval of FY24’s business plan.
3. Approval of FY24’s internal auditing plan.
4. Approval of the engagement of Deloitte as auditor.
5. Approval to engage Deloitte to provide with non-assurance services in case no interest conflicts.
6. Additional budget for CAPEX of the USV
7. Enactment of Procedures related to corporate governance.Approved by all members present - Other resolutions that were not approved by the audit committee but were approved by two third or more of all directors: N/A.
- Items listed in Article 14-5 of the Securities and Exchange Act:
- In the event of a recusal by one of the independent directors due to conflict of interest, name of the independent director, content of the proposal, cause of the recusal, and the voting by participants should be disclosed: None
- Communications between independent directors and internal audit supervisors and accountants (including communications regarding major financial and business situations, methods and results):
- The audit supervisor of the Company submits a completed audit report to the Audit Committee on paper or electronically to the Audit Committee on a regular basis. If the Audit Committee has any questions or instructions, they should inquire or inform the audit supervisor.
- The audit supervisor presents an audit business report to the Audit Committee on a regular or irregular basis, which includes the audit business of the Company and its subsidiaries, audit findings, and improvements of abnormal events.
- The Audit Supervisor submits a statement of the internal control system to the Audit Committee in the first quarter of each year in accordance with the laws and submits the audit plan for the following year in the fourth quarter.
- The Company’s CPAs regularly report to the independent directors on the audit results of the financial report and the situation of internal control checks in the annual Audit Committee meeting and communicate the updates of important laws and regulations.
- In the year of 2023, the summary of previous communications is as follows:
- The communication between independent directors and the internal audit supervisor:
Date of
MeetingTopics of Communication Suggestions and Implementation Results The 1st Meeting of 1st Audit Committee 2023.12.26 1. Internal Auditor’s report
2. FY24’s internal auditing plan
None of the independent directors had any opinions at this meeting - Communication between independent directors and CPAs:
Date of Meeting Topics of Communication Suggestions and Implementation Results The 1st Meeting of 1st Audit Committee 2023.12.26 Pre-audit report on 2023 individual and consolidated financial report. Contents include the scope, timing, and direction of the audit, most significant matter, Key Audit Matters (KAM), and description of other important matters. None of the independent directors had any opinions at this meeting
- The communication between independent directors and the internal audit supervisor:
Remuneration Committee
Company Remuneration Committee
1. Remuneration Committee Member Information
Title Name Professional qualifications and experience
Independent status Number of other public companies concurrently serving on as a Remuneration Committee member
Convener
Independent Director
Weichi Hsu 1. Remuneration Committee, Audit Committee, Board leadership experience.
(please refer to Information of Directors for work experience)
2. With Industry knowledge and financial accounting knowledge.
3. Not engaged in affairs described in Article 30 of Company Act
(1)(2)(3)(4)(5)
(6)(7)(8)(9)(10)1
Independent Director
Robert Tseng 1.Remuneration Committee, Audit Committee, Board leadership experience.
(please refer to Information of Directors for work experience)
2. With Industry knowledge.
3. Not engaged in affairs described in Article 30 of Company Act(1)(2)(3)(4)(5)
(6)(7)(8)(9)(10)
1
Independent Director
Linus Chiu 1. Remuneration Committee, Audit Committee, Board leadership experience.
(please refer to Information of Directors for work experience)
2. With Industry knowledge.
3. Not engaged in affairs described in Article 30 of Company Act(1)(2)(3)(4)(5)
(6)(7)(8)(9)(10)
0
Note: During the two years before being elected and during the term of office, meet any of the following situations:
(1) Not an employee of the company or any of its affiliates.
(2) Not a director or supervisor of the company or its related enterprises (but if it is an independent director set up by the company and its parent company, subsidiary or a subsidiary of the same parent company according to this law or local laws, it is not limited).
(3) Not a natural-person shareholder who holds shares, together with those held by the person’s spouse, minor children, or held by the person under others’ names, in an aggregate amount of one percent or
more of the total number of issued shares of the company or ranks as one of its top ten shareholders.
(4) Not a spouse, relative within the second degree of kinship, or lineal relative within the third degree of kinship, of any of the officer in the preceding (1) subparagraph, or of any of the above persons in the
preceding subparagraphs (2) and (3).
(5) Not a director, supervisor or employee of a corporate shareholder that directly holds more than five percent of the total issued shares of the company, is among the top five shareholders, or appoints a representative to serve as a director or supervisor of the company under Article 27 Paragraph 1 or 2 of the Company Law (but if it is an independent director set up by the company and its parent company, subsidiary or a subsidiary of the same parent company according to this law or local laws, it is not limited)
(6) Not a director, supervisor or employee of another company controlled by the same person who controls more than half of the director seats or voting shares of the company (but if it is an independent director set up by the company and its parent company, subsidiary or a subsidiary of the same parent company according to this law or local laws, it is not limited).
(7) Not a director, supervisor or employee of another company or institution who is the same person or spouse as the chairman, general manager or equivalent position of the company (but if it is an independent director set up by the company and its parent company, subsidiary or a subsidiary of the same parent company according to this law or local laws, it is not limited).
(8) Not a director, supervisor, manager or shareholder with more than 5% of shares of a specific company or institution that has financial or business transactions with the company (but if the specific company or institution holds more than 20% but less than 50% of the total issued shares of the company and it is an independent director set up by the company and its parent company, subsidiary or a subsidiary of the same parent company according to this law or local laws, it is not limited).
(9) Not a professional individual, sole proprietor, partner, company or institution that provides audit or accumulated remuneration over the past two years not exceeding NTD 500,000 in business, legal, financial, accounting, and other related services for the company or its related enterprises. This includes the business owner, partner, director, supervisor, manager and their spouse. However, members of the Remuneration Committee, Public Offer Review Committee or Merger Special Committee who perform their duties according to the Securities Trading Law or Enterprise Merger Law are not limited.
(10) Not engaged in affairs described in Article 30 of Company Act
2. Operations of the Remuneration Committee
(2) Tenures of the Remuneration Committee members are from December 26, 2023 to December 14, 2026. In the year of 2024 the 2nd Remuneration Committee met 1 time.
| Title | Name | Attendance in Person | By Proxy | Attendance Rate in Person (%) | Notes |
|---|---|---|---|---|---|
| Convener | Weichi Hsu | 1 | 0 | 100% | 2nd Remuneration Committee Re-elected on December 26, 2023 |
| Committee Member | Robert Tseng | 1 | 0 | 100% | |
| Linus Chiu | 1 | 0 | 100% |
| Date of Meeting | Content of Proposal | Resolution Result | Response to the Opinion of the Remuneration Committee |
|---|---|---|---|
| 1st meeting of 2nd Remuneration Committee 2024.02.29 | 1. Election of chairman of 2nd Remuneration Committee | All members present unanimously elected member Weichi Hsu as the convener of the current Remuneration Committee. | – |
| 2. Enactment of Procedures related to corporate governance. 3. Approval of the scope by Remuneration Committee for the Management. 4. Approval of managers’ salary adjustment. 5. Appropriation of FY23 remuneration of directors and employees. | Approved by all members present. | The resolution was submitted to and approved by the Board of Directors of the company. |
Committee Member
| Name | Audit Committees | Remuneration Committee |
|---|---|---|
| Weichi Hsu ( Independent Director ) | V ( Convenor ) | V |
| Linus Chiu ( Independent Director ) | V | V |
| Robert Tseng ( Independent Director ) | V | V ( Convenor ) |
Under R.O.C. law, the membership of Audit Committee shall consist of all independent Directors. TSMC’s Audit Committee satisfies this statutory requirement. The Committee also engaged a financial expert consultant in accordance with the rules of the U.S. Securities and Exchange Commission. The Audit Committee annually conducts self-evaluation to assess the Committee’s performance and identify areas for further attention.
TSMC’s Audit Committee is empowered by its Charter to conduct any study or investigation it deems appropriate to fulfill its responsibilities. It has direct access to TSMC’s internal auditors, the Company’s independent auditors, and all employees of the Company. The Committee is authorized to retain and oversee special legal, accounting, or other consultants as it deems appropriate to fulfill its mandate.
The Committee meets at least once every quarter. Please consult TSMC’s Taiwan Annual Report for the relevant year for the number of meetings convened and each member’s attendance rate.
Descriptions of the Communications between the Independent Directors and the Internal Auditors or the Independent Auditors
These Closed Door Sessions relate to corporate finance and operations matters, and are between the Independent Directors and the Internal Auditors or the Independent Auditors. The communication principles are as follows,
The internal auditors have sent the audit reports to the members of the Audit Committee periodically and presented the findings of all audit reports in the quarterly meetings of the Audit Committee. The head of Internal Audit will immediately report to the members of the Audit Committee any material matters.
The Company’s independent auditors have presented the findings of their quarterly review or audits on the Company’s financial results. Under applicable laws and regulations, the independent auditors are also required to immediately communicate to the Audit Committee any material matters that they have discovered.
The Compensation Committee assists the Board in discharging its responsibilities related to TSMC’s compensation and benefits policies, plans and programs, and in the evaluation and compensation of TSMC’s directors of the Board and executives.
The members of the Compensation Committee are appointed by the Board as required by R.O.C. law. According to TSMC’s Compensation Committee Charter, the Committee shall consist of no fewer than three independent directors of the Board. The Compensation Committee is comprised of all independent directors. The Chairman of the Board and the Chief Executive Officer are invited by the Committee to attend all meetings and are excused from the Committee’s discussion of their own compensation.
TSMC’s Compensation Committee is authorized by its Charter to retain an independent consultant to assist in the evaluation of CEO, or executive officer compensation.
The Committee meets at least once every quarter. Please consult TSMC’s Taiwan Annual Report for the relevant year for the number of meetings convened and each member’s attendance rate.
Compensation Committee Meeting Status in 2020
Mr. Michael R. Splinter, Chairman of the Compensation Committee, convened four regular meetings in 2020. The Committee members’ attendance status is as follows:
| Title | Name | Attendance in Person | By Proxy | Attendance Rate in Person (%) | Notes |
|---|---|---|---|---|---|
| Chair | Michael R. Splinter | 4 | 0 | 100% | None |
| Member | Sir Peter L. Bonfield | 4 | 0 | 100% | None |
| Member | Stan Shih | 4 | 0 | 100% | None |
| Member | Kok-Choo Chen | 4 | 0 | 100% | None |
| Member | Moshe N. Gavrielov | 4 | 0 | 100% | None |
| Member | Yancey Hai | 3 | 0 | 100% | New office assumed (Note) |
Meeting Information about Compensation Committee
Independent Director
Master of Department of Engineering Science and Ocean Engineering, National Taiwan University.
Experience:
Manager, Global Aqua Survey Co., Ltd
Vincent Tsai 蔡明格
- Audit Committee (Chairman)
- Compensation Committee
Independent Director
EMBA, National Taiwan University of Science and Technology
Experience:
Sales Manager, Fubon Insurance Co., Ltd.
Joyce Hsieh 謝舒評
- Audit Committee
- Compensation Committee
Independent Director
Master of Naval Architecture & Marine Engineering and in Applied Economics from University of Michigan
Experience:
Manager, Maersk Broker Asia Co., Ltd.
Ethan Wang 王奕仁
- Audit Committee
- Compensation Committee (Chairman)
