Wed, Nov 07, 2018 - Page 12 News List

FSC cautious on proposal to establish labor director

By Kao Shih-ching  /  Staff reporter

The Financial Supervisory Commission (FSC) yesterday said that it would take a wait-and-see approach after a survey found that 76 percent of listed companies disapproved of a proposal by 62 lawmakers to amend the Securities and Exchange Act (證券交易法) to force local corporations to designate a labor director.

Five groups of lawmakers — led by KMT legislators Huang Chao-shun (黃昭順), Lee Yen-hsiu (李彥秀) and Chiang Nai-hsin (蔣乃辛), DPP Legislator Liu Chien-kuo (劉建國) and New Power Party Legislator Hsu Yung-ming (徐永明) — have proposed forcing companies to establish the position of labor director, who would be selected by labor unions or employees.

Boards of directors are elected by shareholders, who have the right to elect directors as they own the company and take the risks, while labor directors could be objective and independent, Securities and Futures Bureau Deputy Director Sam Chang (張振山) said.

Of the 1,513 respondents to the survey of the nation’s listed companies, which was conducted by the Taiwan Stock Exchange (TWSE) and the Taipei Exchange in June 2015, only 18 percent approved establishing the labor director position and 6 percent had “no opinion,” Chang told a news conference in New Taipei City yesterday.

The TWSE routinely conducts surveys, to which only corporate representatives can reply, Chang said.

Chang cited companies that disapproved of setting up the position as saying in the survey that it was not necessary to have a labor director, as they had already been forced to establish an audit committee and independent directors that would pay attention to labor issues, in addition to the need to reach agreements with labor unions.

Some firms also cited concerns that labor directors would not perform better than other directors, Chang said, adding that others responded that they did not need more directors, as they are small companies.

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