A corporation's quest towards sustainability is a process whereby all stakeholders co-create value. Cathay FHC takes stakeholders’ expectations very seriously and upholds four principles of engagement: Materiality, effectiveness, flexibility, and respect. We established the Cathay FHC Stakeholder Engagement Policy on this basis, as well as engagement goals as the basis and methods for identifying stakeholders. We disclose engagement results through a number of channels, including reports, press releases, our website, investor conferences, shareholders' meetings, forums, charitable events, employee and customer opinion surveys; participating in CSR evaluations, and responding to investor ESG questionnaires. These are all active efforts we make to communicate with stakeholders.

 


Materiality Analysis Process

Cathay FHC has dedicated years of effort in the field of sustainability, focusing on material issues in which we can create long-term value. We continue to engage stakeholders to understand the issues they are concerned about. Senior executives use their experience to examine the impact of material issues on our core business, in hopes of creating a mutually beneficial situation in which shareholders make profit, customers are satisfied, and employees are committed. Cathay FHC conducted the Materiality Analysis in 2018 and identified material corporate sustainability issues. We set short-term, mid-term, and long-term goals on this basis. The materiality analysis process is as follows:

Step 1: Collect information and identify issues

Analyze global CSR regulations and initiatives, benchmark enterprises in the industry, industry reports issued by institutions with international credibility, and Cathay's vision and goals.

Step 2: Identify potential issues

Find 9 economic issues, 3 environmental issues and 9 social issues.

Step 3: Understand the materiality of issues

Survey the 155 stakeholders' level of concern about sustainability issues via materiality analysis questionnaire, while 15 senior executives determine the impact of sustainability issues on operations.

Step 4: Set the priority of issues

Use academic methods to take stakeholders' opinions into consideration when ranking the material topic by level of concern and analyzing their impact.

Step 5: Adjust the priority of issues

Senior executives and the sustainability team discuss results of the materiality analysis and make adjustments.

Step 6: Generate the matrix

Verify the 11 material topics and generate the Cathay FHC Material Topic Matrix

 

Cathay FHC 2018 Material Topic Matrix


Cathay FHC ‘s business scope includes life insurance, banking, property insurance, securities, securities investment trust and venture capital, corresponding to the type of stakeholders and issues are also very broad. In 2015, we introduced the concept of integrated reporting (IR) by emphasizing opportunities, risks, corporate strategies, and value creation to identify Cathay's five major capitals for the impact evaluation of material issues. When retrieving stakeholders' opinions, we integrated the company's results of Employee Satisfaction and Voice of Customer surveys, substantially increasing feedback scope and representativeness. From among 61 issues, 18 material issues were identified. In 2015, we also clarified the level of impact that each issue has on the company and specifically incorporated interviews with senior executives to identify the counterstrategies that Cathay adopts in response to each material issue. How to achieve sustainable development of enterprises, design and control through the mechanism, effectively supervise their organizational activities, and improve its organizational operation, has become the enterprise can effectively control the risk and the use of capital to create value. The Compliance Department introduced risk-based management practices in 2016 with the view of achieving better control of compliance risks. 

"Talent" is at the core of the financial services industry. Cathay has always viewed the cultivation of talent as its source of corporate competitiveness. In addition to selecting and fostering people to enrich our talent base, we have promoted Industry-academic Cooperation between the digital financial industry and academia and supported projects to uncover talent in the development of FinTech initiatives. We expect these projects to provide integrated resources that create a pool of financial elite with innovative thinking. These measures are described below:


A corporation's quest towards sustainability is a process whereby all stakeholders co-create value. Cathay FHC takes stakeholders’ expectations very seriously and upholds four principles of engagement: Materiality, effectiveness, flexibility, and respect. We established the Cathay FHC Stakeholder Engagement Policy on this basis, as well as engagement goals as the basis and methods for identifying stakeholders. We disclose engagement results through a number of channels, including reports, press releases, our website, investor conferences, shareholders' meetings, forums, charitable events, employee and customer opinion surveys; participating in CSR evaluations, and responding to investor ESG questionnaires. These are all active efforts we make to communicate with stakeholders.

Cathay FHC CS Committee regularly reviews the short-term, medium-term, and long-term goals of issues. We annually report our performance of communication with stakeholders to the Board of Directors. For more information, please refer to Communication Channels and Response Method of Issues of Concern for Stakeholders.

 

Active Engagement to Guide Industrial Development

Cathay FHC has clearly stipulated on its Code of Operation Integrity and Code of Conduct for Employees that participation in public affairs must comply with laws and regulations, and any donations made must be disclosed accordingly. Following the rapid development of digital finance technologies, financial institutions not only face competition from the technology industry or e-commerce platforms, but must also respond to a plethora of emerging risks, such as aging population and climate change. Cathay FHC engages in the affairs of various associations and societies in hopes of building a consensus in the industry and contributing to industrial development. Long time collaborators include the Insurance Society of the R.O.C., International Insurance Society (IIS), and the Bankers Association of the R.O.C. In addition, Chang-Ken Lee, President of Cathay FHC, is the chairperson of the Financial Planning Association of Taiwan; Tiao-Kuei Huang, Chairman of Cathay Life, is the current chairperson of the Life Insurance Association R.O.C.; and Jeff Chang, Chairman of Cathay SITE, is the current chairperson of the Securities Investment Trust & Consulting Association of the R.O.C. All of these leaders actively promote collaboration between industry and government, and formulate related policies for mutual prosperity in the industry.

Cathay Financial Holdings — Explanations for Public Participation and Policy Influence

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