The Board of Directors is Avalue’s highest governance body. The Board has adopted a diversity policy for its composition, which is disclosed on the Company’s website and the Market Observation Post System. Director nominations undergo a rigorous selection process that considers diverse backgrounds, professional capabilities, and experience, while also placing significant importance on gender equality and the ethical conduct and leadership reputation of individual directors.
To strengthen its corporate governance framework, Avalue stipulates in its Articles of Incorporation that all directors are elected through a candidate nomination system. The Company’s Corporate Governance Best Practice Principles and Procedures for Election of Directors further require diversity to be considered in Board composition. Based on the Company’s operations, business model, and development needs, the diversity policy covers two major dimensions: fundamental qualifications and values, and professional knowledge and skills.
To ensure Board effectiveness, Avalue has also established the Rules for Performance Evaluation of the Board of Directors. The evaluation includes indicators related to understanding corporate goals and missions, awareness of duties, participation in operations, management of internal relationships and communication, professional competence and continuing education, internal controls, and the expression of specific views. The Board and individual directors are reviewed regularly to confirm effective performance and provide a reference for future director selection.
Avalue continues to promote its director succession plan and maintains a candidate database based on the following criteria: integrity, accountability, innovation, and decision-making capability aligned with the Company’s core values; professional knowledge and skills that support corporate management; practical industry experience relevant to Avalue’s operations; and the expectation that the candidate’s participation will contribute to an effective, collaborative, diverse Board that supports the Company’s development needs.
The Board as a whole is expected to possess expertise in corporate strategy, accounting and taxation, finance, law, administrative management, and production management, ensuring that it has the diverse professional capabilities required to oversee operations, risk management, and sustainable development. Director candidates must also pass qualification reviews and comply with applicable laws and corporate governance requirements, enabling the Company to respond to future changes in Board composition while maintaining stability and professionalism.
In terms of Board diversity, Avalue values gender equality and diversity of background. Gender, professional expertise, industry experience, risk management, and sustainability governance capabilities are incorporated into director selection and succession planning. As of the publication date of this report, Avalue plans to increase the number of female directors from one to three in the 2026 Board election, representing one-third of all Board seats and demonstrating concrete progress toward greater female participation. The Company will continue to review Board composition in light of operational development, industry trends, and governance needs, strengthening the complementarity of gender, expertise, and experience to improve decision quality, oversight effectiveness, and governance resilience, while responding to stakeholder expectations regarding diversity, inclusion, and sustainable governance.