98

6.3.6 "Green Values" in Financial Services

Fubon Financial Holdings will continue to promote various programs aimed at conserving energy and reducing carbon emissions, including replacing lighting in office buildings with energy-saving LED bulbs. We will also continue to promote e-billing, green purchasing, and reduce the use of PET water bottles to alleviate Fubon’s impact on the environment and create services rooted in green values.

Subsidiary Initiatives 2018 Action Plans Results

Fubon Life

Promote e-policies and e-notifications

Continued to organize e-notification promotional events, with 6 promotional events throughout the year.

Organized promotional events that offer additional deals for new contracts signing up for e-notification, with two promotional events throughout the year (including one business channel and one service channel).

New non-trading members can apply for e-notification online through the Fubon Life official website.

Optimized e-policy user interface in 2018 to improve convenience.

e-policies Total number of insurance applications:

88,113

Total number of life insurance policies: 44,996

Total number of travel insurance policies: 43,117

In 2018, e-policy applications saved about 1,139,599 sheets of paper resulting in a reduction of about 24,660 kg in carbon emissions.

e-notifications Effectiveness of application promotions

Effectiveness of promoting applications at branch locations

In 2018, applications to receive digital notifications helped save about 1,841,843 sheets of paper resulting in a reduction of about 39,856 kg in carbon emissions.

Continue to promote Paperless Services at Fubon Life by Sending e-statements to Existing Mortgage Customers.

In 2015, Fubon Life began streamlining monthly bills sent to existing mortgage customers and also offered e-billing services in order to reduce the Company's usage of paper.

At the end of December 2018, paperless e-statements accounted for 62.8% of all statements issued to borrowers, an increase of 9.6% over 2017.

Subsidiary Initiatives 2018 Action Plans Results

Taipei FubonBank

Continue to promote digital platform services.

Promoted the online/mobile insurance platform and online financial instrument application platform.

Sent out a total of 20.19 million e-bills, reducing 323,040 kg of paper usage and 1,369,690 kg of carbon emissions

Fubon Insurance

Increase the Proportion of e-transactions

Continued to promote the use of e-policies to reduce consumption of paper and printer ink.

Issued more than 2,170,000 e-policies.

Fubon Securities

Promote paperless services

Encouraged customers to use e-trading services

teadily Promote “Fubon Securities Online Account Opening” mobile app

Dedicated to promote the paperless services

Provided customers with paperless mobile value-added financial services.

In 2018, a total of more than 310,000 customers subscribed to e-billing services, up 30% than 2017, resulting in an annual reduction of approximately 496,702 kg in carbon emissions.

Subsidiary Number of e-Notifications Issued Annual Reduction of Paper Usage(Kilograms)

Reduction in Emissions(Kilograms)

Fubon Life e-policies 88,113 e-notifications 245,579

e-policies 5,816 e-notifications 9,400

e-policies 24,660 e-notifications 39,856

Taipei Fubon Bank 20,190,000 323,040 1,369,690

FubonInsurance

1,746,315 (Car insurance, personal insurance)

65,399 277,292

FubonSecurities

5,857,335 117,146.7 496,702

Promoting e-Policies and e-Notifications

Fubon's four major subsidiaries continued to launch various services such as e-statements in

response to eco-friendly trends and the drive to go paperless; as a result, we reduced our paper usage by a total of 2,208,200 kg in 2018, causing our overall emissions to decline by 520,801kg, demonstrating the green values of our financial services.

Note: According to the Carbon Footprint Calculation Platform of Taiwan's Environmental Protection Administration, plain copy paper made from virgin fibers has a carbon footprint value of 4.24 kg CO2e

Fubon Life

Fubon Life provides a diverse array of mobile services using digital systems to send messages and files to policyholders and sales personnel which not only substantially reduces costs, but also allows services to be rendered in a timelier manner and information to be received by policyholders at a moment's notice. In 2019, Fubon Life will work with various enhancement measures to increase the source of policyholders. Through the operation of digital services, the Company will also increase channels through which customers can apply for e-policies and e-notifications in order to increase the number of policyholders using digital services.

Year 2017 2018

Targeted Number of Policyholder Applications 160,000 160,000

Actual Number of Policyholder Applications 162,594 245,579

Achievement Rate Target 101.62% 153.49%

Year 2017 2018

Applications 28,488 30,769

99

Tender C

areG

olden Practices

Leading Investm

entH

onest Lending

Innovative Finance

Corporate

Governance

Sustainability Strategy

Stakeholder Engagem

ent

■ In 2018, Fubon Life continued to hold the "Complimentary Gifts for First Time Applications" promotional event, setting a target of signing up 160,000 new customers, the achievement rate of which is 153.49%.

■ From January to June of 2018, Fubon Life continued to apply the "New Contract e-Notification Application Bonus" to sales agents handling life insurance policies. The average e-notification application rate for new contracts in the first half of 2018 was 58.1% (the rate for the entire year of 2017 was 40.6%), a total increase of 17.5%. Actively encourage clients to apply for e-notification. An e-notification section was added to the Fubon Life official website to educate the public about the Company's measures to digitize services. The function for non-trading members to apply for e-notification online was also added, promoting e-notification through simple and effective methods.

Taipei Fubon Bank

Taipei Fubon Bank actively promotes mobile payment services, working with domestic and foreign contactless payment platforms such as Apple Pay and pay.taipei, while also developing its own LuckyPAY platform. In addition, the Company promotes online/mobile insurance platform services and increased online financial instrument application platforms to achieve eco-friendly paperless payment and paperless financial instrument application services.

Fubon Insurance

Fubon Insurance provides diverse digital payment channels, in addition to having tellers collect cash and making payments with paper bills, customers can also make payments through the Fubon Insurance Agent Mobile App, the Taipei Fubon Mobile Bank, the official website of Fubon Insurance, PIApp, or deduct payment from financial accounts. In addition, Fubon Insurance has continued to promote the replacement of paper policies with e-policies, which not only cut costs, but also has a positive impact on the environment in Taiwan. Since October 2018, the Company has implemented e-policies on all compulsory Automobile Liability Insurance. In 2018, it has issued over 470 thousand compulsory licenses and over 2.17 million e-policies.

Fubon Securities

Fubon Securities has developed a cutting-edge electronic trading platform that offers tremendous diversity and convenience. Customers can access it at any time with their PC, smartphone, or tablet to stay on top of market information and movements in real time, place trade orders, and receive confirmations. In 2018, 73.52 % of all trades brokered by the Company were made online, which is considerably higher than the market average of 60.43%, according to Taiwan Stock Exchange statistics. The figures again reflected the Company's successful long-term efforts to develop digital finance and its commitment to widening the penetration rate of online services. Looking ahead to 2019, to bolster customer stickiness with respect to the use of our electronic platforms, we will continue to apply our offline channels in a way that encourages customers to access services from the cloud on multiple devices and enjoy a more robust electronic transaction environment.

■ Fubon Securities encourages customers to utilize electronic trading by offering a 40% discount on e-trades, continually refining and developing services, and heavily promoting e-billing, including providing customers electronic statements in an encrypted PDF file, or allowing customers to view their bill after entering their password using a smartphone or PC browser. Our streamlined processes not only help reduce paper use and conserve energy but also dramatically reduce Fubon's carbon footprint, which are environmentally responsible practices typical of a good corporate citizen.

Clients

Clients

Traditional e-Statements: can only be opened after the special software installed in the computers

PDF e-Statements:Can be Opened in Computers and Mobile Devices

■ Fubon Securities and Fubon Futures currently offer thirteen categories of e-billing services, and in 2018 nearly 310,000 customers subscribed to e-services, saving the estimated carbon emission equivalent of taking 496,702 kilograms of paper out of circulation.

Number of Customers Using e-billing and Other Web-based Services

2015 2016 2017 2018

Total NO. of Customers 1,088,220 1,108,780 1,137,215 1,158,590

NO. of Customers Using E-statements 178,408 197,858 241,661 313,106

NO. of Customers Using Web-based Services

531,303 559,512 596,496 636,431

Comparison of Traditional e-billing vs. PDF e-billing

■ In 2015, Fubon Securities launched the "Fubon Securities Online Account Opening" mobile app. In order to expand the scope of services and take our digital services to the next level, in 2018 Fubon Securities launched a web-edition of the "Fubon Securities Online Account Opening" service, making Fubon Securities the first securities dealer to utilize the TWID platform for authenticating identity via a citizen digital certificate or chip card. In 2018, the Company also added the "Version H5 Online Express Account Opening Service" and "OCR function" along with dollar-cost averaging functions to improve efficiency and significantly reduce paper usage.

100

Actively Promoting Paperless Meetings and Video Conferencing

Taipei Fubon Bank encourages the use of tablet and notebook computers to view reportsduring meetings. Our internal personnel are making a joint effort to promote a reduction inthe use of paper for meeting reports. Meanwhile, we continued to promote the use of videoconferencing to help reduce the need for colleagues in central and southern Taiwan to travelto the north, thereby conserving energy, reducing carbon emissions, and helping to instillgreen values in all bank employees.

Fubon Securities has promoted the M+Messenger corporate account for a number ofyears. Agents can join the corporate directory through corporate email verification, makingit an important supporting tool in the business that allows the Company to quickly sendout messages through group notice boards, effectively improving the efficiency of teamcommunication. At the same time, the messages are encrypted for information security. It isthe first successful step to establishing a "paperless conference system".

6.4 Establishing Workplace Models6.4.1 Labor Practices and Human Rights

Fubon Financial Holdings continue to establish a culture of equality, tolerance, and opencommunications, the main results of which includes gender balance in supervisory roles,a number of employees with disabilities that meet the legal employment quota, and aharmonious labor negotiation mechanism.

Fubon Financial Holdings firmly believes that fostering a culture founded on equality,inclusiveness and open communications can help employees feel at ease on the job andwork hard alongside the Company – ultimately strengthening human capital. We supporthuman rights and have put in place a human rights policy that means treating all employeeswith a fair, impartial, inclusive and respectful attitude. Any individual with the requisiteability and qualifications for a position shall not be treated unfairly or discriminated againstbased on race or ethnicity, class, language, ideology, religion, political affiliation, birthplace,gender, sexual orientation, age, marital status, appearance, facial features, disabilities or anyother factors. We also welcome good communications and listen carefully to the opinions ofemployees. Both physical and digital tools are used to create an atmosphere that encouragesdiscussion and mutual understanding and promotes labor-management harmony. In addition,the Company clearly communicates its management philosophy and development strategies,giving employees a greater sense of identification with the organization.

Flowchart Illustratingthe Human RightsDue Diligence SurveyProcedure

Step 1Study and analyzehumanrights issues and identifycurrentcircumstances andtrends.

Step 2Examinerelevant companyservices andpolicies and identifycorrespondingstakeholders, i.e.,groups of individualsrequiring humanrights protections.

Step 3ESG workinggroups discuss thefindings and gatherdata,define potential risksand issuesaffecting differentgroups, andconduct follow-upassessmentand management.

Step 4Collect andsummarize duediligencesurvey forms andformulateimprovementmeasures andtargets.

Step 5Conductreviews on aregular basis.

Fostering a Culture of Equality, Inclusiveness and Open Communications

1. Public Declaration of Support for International Human Rights PoliciesFubon Financial Holdings believes that every person should be treated fairly and with respect,and, along with its employees, has publicly pledged its commitment to the spirit of the UniversalDeclaration of Human Rights and the UN Guiding Principles on Business and Human Rightsand to respect internationally recognized human rights. We are committed to upholding andrespecting the core labor standards articulated in the Universal Declaration of Human Rights andInternational Labor Organization declarations.2. Implementation of Human Rights Due Diligence Survey ProcedureIn 2017, Fubon established a "Human Rights Policy", and continue to uphold the human rightsof employees, suppliers, customers and business partners and stop any conduct that violates orinfringes on the human rights of others, ultimately ensuring that people inside and outside theCompany are treated fairly and with dignity.In terms of the human rights of our employees, Fubon Financial Holdings conducteda Human Rights Risk Assessment (HRRA) for all employees according to the provisions of theInternational Labor Organization’s fundamental conventions and subsequently implementedcontrol and mitigation measures based on the specific risk levels identified in the assessmentresults to prudently safeguard the human rights and equality of personnel from every angle.

3.Assessing and managing HumanRights Risk

In 2018, Fubon Financial Holdingscontinued to have members ofthe Employee Care Team carry outhuman rights risk assessments onbehalf of the Company's 39,468employees . The asses smentshowed that some employeesbelieved that the company hadmoderate r i sks in "overt imework". In order to effectivelyalleviate this overtime situation,t h e C o m p a n y c o n t i n u e s t oactively manage working hoursaccording to the existing "workru les" , conduct ing month lyreviews of the overtime status ineach department, and remindingsupervisors to help employees withlonger working hours properlyredistribute workloads throughannouncements on the Company'sinternal website; Subsidiariesalso manage work hours withthe help of digital platforms,designating every Wednesday andthe first Friday of each month as'family day' in order to encourageemployees to get off work on time. In 2018, 19.8% of employees applied for overtime pay. Inthe future, human rights risk assessments will be conducted on a regular basis to protect thehuman rights of all members of staff.

Initiatives 2018 Action Plans Results

Foster a CultureBuilt on Equality,Inclusivenessand OpenCommunications

1. Women hold more than 55% of allmanagerial positions.

1. The percentage increasedthan 2017.

2. Total of 435 people with disabilitiesemployed, about 1.1% of total workforce.

2. Meet the legal employmentquota.

3. Upon the expiration of their 3-yearagreement, Taipei Fubon Bank, FubonSecurities and Fubon Futures negotiated thecontents of a new agreement, with unioninvolvement around 38.7%.

3. Increase 3.4% than 2017.