Industry Representative Jian-Guo Fan Comes Together with

Academia Representative Xiu-Ru Ma

Corporate Governance of Multinational Enterprises and Overseas

Branches

On November 20, 2020, WT Microelectronics invited Professor Xiu-Ru Ma from the Department of Accounting at National Chengchi University and Mr. Jian-Guo Fang, Chief Auditor of Hotung Venture Capital Group Holdings to give a course on corporate governance of multinational enterprises and their overseas branches. The course explored effective corporate internal control mechanisms and responsibilities, internal control declarations, overseas capital management, and fraud and corruption prevention.

According to Professor Ma, there are five components to internal control: 1. control environment, 2. risk assessment, 3. control activities, 4. information and communications, and 5. monitoring activities. She stressed that “control environment” is not to be taken literally, that it is not about controlling the environment but about controlling people. In other words, it is about managing the capabilities and moral standings of leaders, board members, management, and employees.

Chief Auditor Fan mentioned that for any internal control framework, risk assessment is always the starting point.

Due to limited resources, it is impossible to achieve perfect risk control. Reality will always force some amount of residual risk onto the company. Therefore, effective internal control is about correctly managing residual risks and maximizing residual risk mitigation so that businesses can effectively adapt to competition and different challenges from domestic and abroad.

Chief Auditor Fan also shared how major corporations such as Google and Microsoft are transitioning to zero trust communication systems in response to the COVID-19 pandemic. The zero trust security model has opened up a whole new set of governance possibilities as it massively restructured IT access authorization, roles, tasks, and procedures. The new model allows for the use of integrated real-time data to optimize the risk curve and risk assumption.

Lastly, Professor Ma also reminded board members and managers of the meaning and responsibility that comes with signing internal control declarations.

Professor Ma (first from left) giving her lecture with WT Microelectronics independent director Terry Cheng (second from left) and Kung-Wha Ding (second from right) in attendance.

WT Microelectronics Chairman, Eric Chang (second from left), taking questions.

Chief Auditor Jian-Guo Fang from Hotung Venture Capital Group Holdings explaining the difficulties of practicing legal compliance.

Student posing for a photo with Professor Ma (front row, third from left) and Chief Auditor Fan (front row, third from right).