The responsibilities of Novatek Microelectronic’s Board of Directors are to assist management in the formulation of short, medium and long-term strategic plans which correspond with corporate objectives and meet the expectations of our shareholders and stakeholders, and to vigorously implement the responsibilities of executive supervision, convening meetings every quarter, and maintaining excellent communication with the management level.

The Company passed the “Measures for Performance Evaluation of the Board of Directors” in the October 2019 board meeting, which stipulates that an internal board meeting and functional committee be held every year, and that individual directors carry out a self-performance evaluation. Every three years, a performance evaluation is carried out by an independent external professional institution. The results are reported to the Board of Directors in the first quarter, to serve as a reference in continuously enhancing the board’s operational effectiveness.

The overall Board of Directors, functional committee self-evaluations, and the self-evaluations of directors of the board are carried out by means of internal self-evaluation questionnaires annually. The period evaluated was from January 1 to December 31 of the current year. The questionnaires mainly covered the following facets: degree of participation in Company operations, improvement of decision-making quality, composition and structure of membership, position selection and continuous education, and internal control. After statistical self-evaluation results had been collected in 2023 and 2024, the two-year self-evaluation results of the Board of Directors, the Audit and Risk Committee, the Remuneration Committee, the Nominating and Sustainable Development Committee and individual directors all averaged as “Excellent”, which were reported to the Board of Directors in the first quarter of 2024 and 2025, respectively.

• The Independence of External institutions: The Taiwan Corporate Governance Association is an independent professional institution for corporate governance assessment and board performance evaluation which has already provided services to more than 600 instances for public enterprises, listed OTC companies and general companies with public offerings and non-public offerings of shares.
• Evaluation Period: November 1st, 2023 to October 31th, 2024.
• Evaluation Methods: Online self-assessments, collaborative review conducted by the association's evaluation committee members and specialists as well as on-site assessments.

• Scope of Review (Five Sections):

1. Composition and Division of the Board of Directors
2. Guidance and Supervision of the Board of Directors
3. Authorization and Risk Management of the Board of Directors
4. Communication and Collaboration of the Board of Directors
5. Self-discipline and Improvement of the Board of Directors

• Summary of Evaluations:

1. More than half of the members of the Company's Board of Directors are independent directors and four female directors make up 50% of the total seats, demonstrating our commitment to gender and professional diversity in board composition.
2. To enhance organizational efficiency, the Company incorporated risk management into Audit Committee in July 2024, renamed as Audit and Risk Committee. Additionally, sustainability has been integrated into Nomination Committee, renamed as Nominating and Sustainable Development Committee. At the management level, we have established ESG Sustainability Committee and Risk Management Committee, which regularly report to the Board of Directors.
3. The Company's Board of Directors values the results of external evaluation and continues to strengthen corporate governance. Our corporate governance evaluation scores have consistently ranked within the top 6-20% of listed companies over the long term. In the last two years (the 9th and 10th term), we have advanced to rank within the top 5% of publicly listed companies, achieving exceptional results.

• Evaluation Recommendations/ Improvement Status:

1. It is recommended to incorporate succession and training plan for senior managers into the responsibilities of Nominating and Sustainable Development Committee and regularly report on the operation of expertise development mechanism to the Board of Directors. This will facilitate the board supervising the implementation of the Company's senior talent development and succession plans. The Company will reassess relevant rules and regulations of the committee in 2025 and plan to revise proposals in line with operational timelines.
2. It is also recommended that each Independent Director first provide their assessment of the performance of the Internal Audit Supervisor, which is then submitted to the Chairman for reference and approval. This will further strengthen Audit and Risk Committee's supervisory function over internal audit. The Company will incorporate 2025 performance evaluation of internal audit supervisor into independent directors' assessment opinions for reference.

The company established the Nominating Committee in July 2022 and renamed it the Nominating and Sustainable Development Committee in July 2024, which be responsible to nominate candidates for directors and independent directors, strengthen the competency of the Board of Directors and enhance enterprise sustainability value. The Company’s selection of directors is based on the overall configuration of the Board of Directors and the realization of the goal of diversifying the professionalism and background of directors, then be voted by the shareholders' meeting.

The Company's ongoing director succession plan is based on the Company's amended "Director's Nomination and Selection Policy" approved in 2023, and a director candidate database is established according to the following standards:

• Board members need to have professional backgrounds (such as in law, accounting, industry, finance, marketing or technology) and professional skills (such as operational judgment, accounting and financial analysis, business management, crisis management, industry knowledge, international market outlook, leadership and decision-making) and attach great importance to enterprise sustainability and social participation: corporate governance, environmental sustainability, social responsibility, legal compliance and human rights protection, etc. Apart from requiring that board members have professional backgrounds and specialized skills, in order to prepare them for succession, the Company arranges for each director to take at least six to 18 hours of refresher courses every year. These courses are divided into two main categories: core courses and professional courses, covering areas such as enhancing the performance of Board of Directors, finance, accounting, as well as fields like corporate social responsibility, risk management, internal control systems, corporate governance, etc. Directors are thereby helped to fully familiarize themselves with the Company’s operational activities and acquire new knowledge of the industry’s underlying structure, so as to continuously hone their professional capabilities.
• Diversification of the Board:

1. At least one female director
   
2. The number of independent directors exceeds one-half of the board seats
   
3. At least one seat with accounting or financial expertise
   
4. At least one seat with academic background
   
5. Diverse industrial experience: Experience of directors covers at least 3 different industries
   
6. All directors are not a spouse or relative within the second degree of kinship to any of other directors
   
7. Limit the number of directors who also serve as managers of the Company to less than one-third of the total directors