In line with the United Nations’ goal of promoting financial inclusion for disadvantaged groups and remote areas to provide basic financial services. Chailease formulated " Financial Inclusion Policy", committed to actively innovating and expanding the accessibility and use of financial services, and launch tailor-made financial products and services that meet the needs of all sectors of society or different ethnic groups. We exert our financial influence to ensure that all social classes and groups can enjoy fair and reasonable financial services or resources. We also indirectly contribute to increasing the employment rate and enhancing the quality of life for disadvantaged groups.

The following examples illustrate the aspects that have been implemented:

●Operating level:
-Establishing the Digital Finance Committee, chaired by Chairman Albert Chen, to be responsible for strategy and product development related to financial inclusion.
-Setting up an audit committee to promote the credit scoring risk modeling mechanism and identify over-indebted customers as high-risk groups and decline them loans.

●Innovative service:Continuing to provide useful and affordable financial products for businesses and individuals based on market research and customer feedback. We pioneered the cardless installment service (zingala) to realize the dreams of consumers and young people, accumulating more than a million members.

●External collaboration: Working with e-commerce merchants to refine the consumer scenario for cardless installment services, partnering with retailers ranging from large-scale shopping websites to well-known brick-and-mortar stores, and integrated payment services to expand the targeted financial inclusion market.

Chailease Holding is committed to providing fair and reasonable financial services to all social strata and groups, as well as providing non-financial support in order to give back to the society and create a more inclusive and harmonious financial environment.

●Forum Seminar: Organizing SME forums and student finance-related seminars to provide non-financial support to SMEs, micro-enterprises, and individuals.

●Immediate Complaint Handling Mechanism: Completing customer complaint handling and reporting within the required timeframe in order to establish a good two-way communication channel.

●Customized Services:

Chailease Holding takes into account the needs of disabled customers and provides them contracted and guaranteed home services. At the same time, a barrier-free webpage was launched in the first quarter of 2024, providing comprehensive product and service information.

Having an environment friendly to those with physical or mental disabilities is an important item on Chailease's office assessment checklists. Taking the Neihu headquarters as an example, the entrance to the main building features a barrier-free ramp for people with disabilities, and guard booths are available to help those who might need assistance immediately.

In accordance with the Protection Act for Rights and Interests of Disabled Persons, guide dogs, deaf guide dogs, and physical assistance dogs are free to enter and exit each business unit. In addition to accessible ramps and helpful guards in the headquarters building, there are also 84 accessible bathrooms, evenly distributed on each level of the building. The hope is that any colleagues who are in need will be able to access them conveniently and quickly, so that accessibility will truly be universal. Chailease has branches in many places, and when selecting office buildings around the world, a primary selection criterion is an environment that is friendly to those with physical or mental challenges.

Employee Training Training Programs: Conducting customer-focused employee training programs that emphasize creating an enjoyable atmosphere and avoiding a fast sales pace in order to provide customers with the optimal level of information and support.

In order to become an "excellent financial company in the Asia-Pacific region", Chailease knows that financing in developing countries is no easy task. Because the financial systems in developing countries are relatively unsound, the credit system are relatively weak, and the risk tolerance are low, banks are tend to finance guaranteed and well-capitalized customers. Under reasonable risk assessment, Chailease provides differentiated services to customers with different risk levels as much as possible, and assists small and medium-sized enterprises with weak financial status to meet their needs of funds. 

To be able to better serve SMEs, microenterprises and individuals in the Asia-Pacific region, since 1989 Chailease has opened branches and provided office services throughout the ASEAN region. At present, our offices cover Thailand, Vietnam, Malaysia, Cambodia, Philippines and Indonesia. This begins from equipment leasing and installment payment services, and as economic development dictates, expands to include installment loans for vehicles and motorcycles, insurance agencies, and so on, to meet local needs. Since its establishment, Chailease has served over 100,000 SMEs, microenterprises and local manufacturers at all points in the supply chain.

In accordance with SASB rules, the relevant classifications of micro-enterprise and personal loans undertaken by Chailease Holding in 2023 are as follows:

Chailease formulates "Sustainable Financial Policy" to fully cover corporate consumer finance business, involved in corporate finance, investment business and retail banking, and has established a comprehensive monitoring mechanism for credit recipients, organized a risk management committee to formulate risk polices, and set up a review committee to do credit checks and verifications before lending. Evaluation mechanisms have been enhanced, and credit quality control implemented. To fulfill corporate social responsibilities while considering the interests of customers and shareholders as well as financial sustainability, Chailease added ESG factors to its credit evaluation process requiring credit companies to assume responsibility for employees, society and the environment. They must also abide by corporate ethics, respect employee rights and care, and prioritize environmental protection. The company is committed to reducing ESG risk to enhance the value of its long-term corporate investment/loans. Chailease also actively promotes green energy development, environmental carbon reduction and increased employment rate to promote sustainable economic growth and social development.

Supervision Mechanism

Communicate with Customers about the Risks and Opportunities of ESG

Chailease Holding continues to communicate and negotiate with its clients through a variety of channels to help them understand the risks and opportunities associated with sustainable development. In 2023, we communicated with 100% of all our corporate and individual customers.

Review Process

Starting in 2023, we included in our credit applications a statement of our commitment to UN sustainability goals. We communicate with our customers to promote sustainable development, and agree to respond to the United Nations’ sustainable development goals. As we pursue growth, we take into account sustainable development, corporate governance, and the implementation of corporate social responsibility/personal social responsibility, and review the effectiveness of implementation and continuous improvement at all times. We aim to have 100% of our customers completing credit applications from the fourth quarter of 2023 onwards and declare that they have read the above statement of our commitment to the United Nations’ sustainability goals. In order to monitor customer risk cases, the corporate finance credit business has added ESG risk review to the KYC process (see below).

Liability Insurance

Chailease upholds corporate social responsibility. To avoid unpredictable accidental losses to enterprises, when setting up real estate collateral a customer has to insure against fire, water and earthquake risks. Items mortgaged by the company must also be insured against fire to guarantee basic insurance protection; for high-risk industries, such as shipping, based on operational responsibility requirements, ship owner liability insurance and hull insurance are required. In 2023, there were 175 marine insurance contracts, with approximately 936 million in mortgage ship interest insurance (MII). Hull insurance was about 1.94 billion, indemnifying against damage to the hull or harbor through collision, as well as against death or injury to crew members, wreckage removal and possible polluting oil spills. In addition to ensuring the sustainable operation of enterprises, this policy also contributes to the protection of the environment.

Chailease Holding cooperates with banks to provide funds into green financing. The fundraising projects include green bond, syndicated loans. The cumulative amount exceeds NT$130 billion. The funds raised are used for renewable energy and green energy related projects to accelerate the development of solar power plants.

Vietnam Syndicated Sustainability-linked Loan Case

Chailease Holding is committed to promoting sustainable corporate development and continues to enhance its investments in all aspects of ESG. The Vietnam subsidiary, Chailease International Finance Corporation, a leasing company, completed the signing of a US$30 million syndicated sustainability-linked loan outside of Vietnam in November 2023, which is linked to the Chailease Holding sustainability index with corresponding interest rate incentives.

Sustainable Corporate Finance Products

 

Energy-Saving Equipment Financing Projects

In 2023, Chailease participated in more than one hundred financial leases and installment projects for energy-saving equipment financing projects (such as LEDs, cloud-based energy-saving controllers, power savers, solar photovoltaic modules, optical energy-saving fluorescent lamps, inverters, and other equipment),with a total amount financed of over NT$570 million. In addition to contributing to environmental protection, corporate social responsibility and green energy products, this also brings long-term, stable performance and benefits to the company. In the future, we will continue to replicate Taiwan's successful experience, and develop more overseas markets. We also invested in an overseas Indonesian company in 2023 to develop equipment management software and supply chain procurement platforms to integrate procurement logistics services, save on fuel consumption and carbon emissions to promote more effective and efficient equipment usage, with estimated fuel savings of up to 27%, and to help promote environmentally friendly products to non-tier 1 cities. In 2020, we also invested in companies that provide services, such as consulting and software for logistics optimization, route optimization, and volume optimization to corporate customers in the manufacturing and logistics industries.

SME Sustainable Financing

SMEs are the cornerstone of Taiwan’s economic development. We will continue to support the sustainable development of SMEs and work together to create new business opportunities for sustainability and accelerate the pace of net-zero transformation.

Socially Responsible Financing in Vietnam

Our Vietnamese subsidiary, Chailease International Financial Leasing Corp., promotes inclusive finance activities for micro, small and medium-sized enterprises through social responsibility financing, with the aim of helping the local economy grow. The social investment plan is evaluated in accordance with the Social Loan Principles 2021 of the Asia Pacific Loan Market Association and the Social Bond Principles 2021 of the International Capital Market Association, and with a confirmation report from the accounting firm. During the fund utilization period of this plan (April to July 2023), the total actual investment amount is US$76.75 million.

Core elements of the plan:

(1) Use of proceeds: Focuses on single categories, such as social and economic development and rights protection. The categories, projects, fund allocation and benefit evaluation are shown in the following table:

(2) Process for evaluation and selection: In addition to the general investigation required for credit applications, we evaluate whether the type of industry, the use of loan funds, and the actual benefits generated are in line with socially beneficial investment plans. In addition, fossil fuels, tobacco and tobacco products, weapons and ammunition, hazardous chemicals and radioactive materials, and other industries and activities prohibited by Vietnamese law are excluded from the investment program.

Sustainable Consumer Finance Products

The development of sustainable finance is currently an increasingly important trend in Chailease’s business, and in response to the trends for energy conservation and carbon reduction worldwide, the government of Taiwan has also implemented low-carbon city and low-pollution policies. When Chailease launched its motorcycle loan business, it vigorously promoted electric scooters as well. The company agrees that clean energy is more friendly for the environment, and installment payments can help more people to be able to move toward electric scooters, as a means to work together to reduce air pollution.

In response to government regulations, Chailease Holding also provided loans for old diesel vehicles to help replace them with new ones. This has helped reduce diesel air pollution, reduce black smoke, improve air quality, and reduce energy consumption. Chailease Holding does its best for the sustainability of the earth.

Chailease's core competitiveness is the basis for its product "innovation". At the same time, the company takes corporate social responsibility into account, opening up green markets and establishing the green competitiveness of the enterprise. In 2015, Chailease Energy Integration Corporation was born. The company provides customers with energy-saving services and helps enterprises to fulfill their social responsibilities in the areas of green energy and environmental protection. In 2014, the company won a MOEA Bureau of Energy bid for solar photovoltaic power generation equipment, and we successfully bid for two solar power plants located in Alien District, Kaohsiung; and by October 2014, we acquired 71 solar power plants from Yun Tang inc., which were previously owned and operated by NGP, a subsidiary of Neo Solar Power Corp. for NT$445 million. Since then, we have built and acquired a large number of solar power plants. In 2018, held 1,000 such plants. This makes Chailease the company in Taiwan with the most solar power plants. The amount of new investment in solar power plants in 2023 will be approximately NT$8.316 billion. As of the end of 2023, the Company has a total of 3,792 plants with a total capacity of 1,402.96MW, representing a 28% increase over 2022. The plants are expected to reduce 868,014 metric tons of CO₂ emissions per year. That's equivalent to planting 72,341,399 trees.The estimated average increase in labor force due to power plant investment is 45.96%. (According to our exclusive solar power service provider, as of December, 2023, the installed capacity of domestic solar power systems in Taiwan is 12,417MW with an estimated annual electricity generation capacity of 15.52 billion kWh. The annual carbon reduction is equivalent to planting 658,396,000 trees/year; website)

In order to effectively manage many power plants, Chailease Energy Integration has developed its own management software to establish a solar photovoltaic smart operation management platform which has basic monitoring and operation functions, such as detecting malfunctions, alerting maintenance, receiving sunshine, and power generation. It also has smart maintenance service functions that also ensures detailed recording of power plant information which is a credible basis for future valuation, and an important reference for evaluating the corporate value of listed power plants.

At the same time, in response to changing trends of future energy use, Chailease Energy Integration Corporation, a subsidiary, also assists customers by promoting new energy creation, energy transfer, and energy storage technologies. The skilled application of energy planning includes smart power grids, electric vehicles, charging stations, and the application of energy monitoring and management systems. In addition to continuing to promote energy efficiency and carbon reduction, the company is further committed to helping enterprises establish comprehensive and innovative energy management strategies in order to integrate them with future industry trends.

In the future, Chailease Holding will be active in the field of energy creation, mainly in power plants, and plans to continue to acquire more solar power plants through self-construction or mergers and acquisitions in order to achieve economies of scale. In addition to continuing to focus on the rooftop market, and in response to the trend of ground-mounted models becoming the mainstream, we will continue to work with the industry to expand the scale of our power plants and ensure the stability of green energy, in order to fulfill our environmental sustainability and social responsibility.

Chailease Holdings responds to government’s green energy policy, in 2017 the company combined the sharing economy and financial technology in promoting its "Chailease Citizen Power Plant". The public can directly participate in the investment and construction of power stations by subscribing for solar panels, allowing citizens to participate in the investment in solar power generation equipment and share the proceeds according to the amount of power generated and the selling price, allowing the public to participate in the popularization of renewable energy. In 2019, in order to improve the function of the platform and increase the mobility of solar panels, we have launched the “Citizen Power Plants Second-hand Market”, in the form of a website announcement column, so that members who have already purchased solar panels on the platform can have a suitable pipeline to look for willing buyers when they have a demand for transferring second-hand solar panels.

"Chailease Citizen Power Plant" a total of 22 cases had been launched to enthusiastic public response, with 100% of sales completed. These 22 cases are estimated as generating over 127,004,058 (degrees) of electricity in the next 20 years, while also fulfilling Chailease's green energy corporate social responsibility.

From finance, the company moved into its 5871 Business Trader website to provide a matching service for used equipment transactions. The idea is to allow equipment that was to be retired to be transferred and continue in operation. A total of 858 suppliers and 182 equipment types are on the system, and some 531 matchmaking transactions are concluded in 2023. This has been a great contribution toward the activation and sustainable operation of used equipment assets.

In addition to green financing, Chailease has also put forward more solutions for energy conservation and carbon reduction. The company's "HeyTruck platform app" was launched in 2019, targeting the trucking industry and driver groups that have been underserved by the traditional financial industry. One of the most critical services is the "Return Trip Matchmaking Service". In the past, if a trucker had completed a long haul trip with freight, he would have to drive back to the starting point empty. The "HeyTruck platform app" provides a means for truck drivers and cargo owners to get together, allowing drivers who would otherwise roll empty to help cargo owners who need carriers.

Since the launch of this app, an average of 300 successful matches have been made per month. This not only provides extra income for owners of large trucks, but also provides cheaper freight to shippers. And because the app allows effective use of vehicle resources, it also helps reduce carbon emissions. It is estimated that this will eliminate some 74,000 kilograms of carbon emissions in 2023. This is yet another Chailease effort for sustainable development of the global environment. (Note: Based on an average of 280 return cars per month, the distance from Taipei to Taichung is used to estimate the annual carbon reduction. The method for calculating annual carbon reduction is the number of return cars × number of round-trip kilometers × the amount of fuel consumed per kilometer × CO2 emission factor per liter of oil product.)

Since the promotion of Chailease's Zingala which is deeply loved by people just starting out in life, to encourage paperless payments, and save unnecessary wasted paper, members can make payments using the app. In 2020, the company launched a mobile app to allow vehicle installment loan payment, with no need to waste paper printing out bills. It is estimated in 2023 that more than 16.65 million sheets of A4 paper has been saved, reducing carbon emissions by 10.7 tons. (Note: Each pack of A4 paper contains about 500 sheets responsible for 3.2kg/CO₂e in carbon emissions. Source: Product Carbon Footprint Information Network.)

Chailease is developing both solar green energy generation and storage capabilities, opening up a road to sustainability and joining the semiconductor industry association SEMI's "PV Public Advocacy Committee". The committee want to build consensus within industry and periodically interact with relevant government officials. The "Solar Optics Public Policy Statement" was first published in 2019, actively representing Taiwan's photovoltaic industry.

Additionally, Chailease also joined the "Solar Power Generation System Commercial Industry Association", more actively connecting industry, government and think tanks while using multiple resources to actively forward knowledge on green energy and raising recognition and investment in the area, so as to spur Taiwan's achievement of energy diversification and independent supply goals.

Chailease Holding is committed to providing fair and reasonable financial services to all social strata and groups, as well as providing non-financial support in order to give back to the society and create a more inclusive and harmonious financial environment. The activities to be handled in 2023 are as follows:

In 2023, a customer satisfaction survey was conducted covering all major products, with a total of over 4,101 questionnaires collected. Using the quantitative conversion mechanism of indicator satisfaction, the average overall satisfaction rate of corporate finance customers was 97.62%, the average overall satisfaction rate of consumer finance (zingala card) customers was 100%, and the average overall satisfaction rate of short termtenant customers was 100% in 2023. The overall satisfaction rate of customers with the Company’s services exceeded the set target, reaching over 90%.

Survey respondents:

1. Corporate Finance-Customers we accepted from January to December 2023, and customers whose contracts expire from July 2023 to June 2024, excluding terminated / unterminated customers and customers who were surveyed in 2022.
2. Consumer Finance-zingala members accepted 2 times (or more) between 2023/1/1-2023/12/31 or random sampling of 3% of those with total coin offset amount greater than NT$1 in the past to date.
3. Short term rental-Successful pickup and return of vehicles (excluding foreign customers) for the whole year of 2023.

Calculation:

1. The original corporate finance questionnaire employs a 5-point scale, and responses with an average rating of 4 or above are considered satisfactory.
2. The original questionnaire for short-term rentals employs a 7-point scale, and responses with an average rating of 5 or above are regarded as satisfactory.
3. The original questionnaire on consumer finance employs a 5-point scale, and responses with an average rating of 4 or above are considered satisfactory.

After the results were calculated, a qualitative approach was also used to gain more information about special cases. These results became an important topic in management committee meetings. It is hoped that by establishing multiple communication channels, we will be able to hear more customer voices, understand customers’ real needs, and propose the most appropriate improvement methods to achieve our goal of providing customers with the best possible service.

These topics entered into discussions among the operations and management committee. The hope is to strive to establish more and diversified channels of communication so that the company can better listen to the voices of many customers and understand their true needs. This is the way to find a pathway to improvement and gradually increase customer satisfaction with a goal of providing customers with truly excellent service.

Chailease Holdings places great emphasis on different perspectives. We collect customers’ opinions actively and take a very open-minded view of employee suggestions or any innovative thinking within the group. We set up an employee suggestion system and an incentive platform to get innovative suggestions, encouraging employees to bring forth new ideas. We hope the system will allow the thoughts from employees could be implemented, so that we can always know what the customer's need in advance.

Before bringing out a new product or service, we would have internal assessment of the legality which ensures the product or service complying with laws. All promotional ads, public relations news or employment ads which are post in print, electronically or in sound form must go through the company's internal auditing and managing processes. The coherent units must review and approve its legality to ensure the rights of those getting information and to maintain the company's reputation and image. Items officially online should be adjusted at all time based on customers’ opinions and the feedback of our employees, to meet our sole goal that design products which can meet our customers' needs.

Before the implementation of the new personal information protection law, the Company already had in a place a security mechanism for maintaining personal information, including the formulation of “Data Classification Management Measures”, “Personal information Protection Key Points”, “Information Security Policy”, “Information Security Management Key Points”, and other specifications. We clearly formulated the protection procedures to be followed for the authorization, use, storage, management and destruction of personal information. At the same time, in order to demonstrate our persistence and commitment of attaching great importance to the safety of customers’ personal information, a personal information protection team has been established to ensure the implementation of the personal information law.

Regarding the protection of personal information, the Company has three lines of defense controls to ensure that the collection, processing or utilization of personal information complies with external laws and internal regulations:

The Company is committed to enhancing information security management, establishing appropriate protection measures for all information areas within the Company in accordance with relevant internal and external regulations and regulations as well as regularly reviewing the suitability of the regulations to prevent improper disclosure of customer personal information, so as to reduce penalties by the competent authority that could damage the Company's reputation.

Chailease Holding and its subsidiaries attach great importance to customer information security and personal information protection. When customers provide personal information, we request they sign the "Notice of Collection, Processing and Utilization of Personal information", and strictly control the use of customers' personal information. If it is necessary to cross products or use the customer's personal information for non-primary collection purposes, it must comply with laws and regulations and obtain customer consent, and shall be handled in accordance with the following principles:

In addition, according to the personal data security protection and operation risk level, we carry out personal information masking operation of the necessary system, control the secondary use of personal data and implement various security control measures. In 2022, the rate of the secondary use of personal information of the Company and its subsidiaries is 46.27% 

No complaints about personal data leakage were received in 2023(including Personally Identifiable Information, such as name, ID number and other information that can be distinguished or traced to individuals).

In addition, information personnel should perform the necessary systematic covering of personal information and control the secondary use of personal information in accordance with personal information security protection and operational risk levels. According to different business areas, we set up different levels of data access authorization and implemented USB storage device lockout management to reduce the risk of data leakage, thereby enhancing the control and checking of data copying. We have also set up strict specifications and controls for internal transmission of customer information. They are regularly reviewed by the internal audit unit to ensure that all control mechanisms are effectively implemented. There has been no personal information leakage (including personal information PII, such as name, and ID number that can be distinguished or traced to individuals).

To ensure the confidentiality of customer data, all our employees receive personal information confidentiality and operational security law training. This provides them with a reference and develops their consciousness of personal information issues so they will conduct good data security practices and protect personal information in their daily work. We also require employees to appropriately perform their responsibilities of protecting confidentiality and managing data, with rigorous internal rules for management as well as the gradual establishment of an audit trail and records tracing systems. The management of personal information has been included in the scope of annual audit of inspection of information and communications security and self-assessment, and through these comprehensive and targeted reviews, we will increase the protection of customer data by employees and increase knowledge of and compliance with relevant law. The auditing units of the Company and its subsidiaries shall conduct inspections of the implementation of personal information protection in accordance with regulations. We will import personal data management standards in the future (ex. BS 10012 or ISO 27701). If it is otherwise provided by laws or regulations or required by the competent authority, each subsidiary may also, depending on actual needs, appoint an independent third party to conduct the inspection of the matters specified in the preceding paragraph and provide inspection recommendations. In 2023, the company did not have any information security violations that caused the leakage of customers' personal information, and there were no confirmed complaints of infringement of customer privacy or loss of customer information.

In the future, we will continue to plan the management systems and norms related to data governance, introduce a data leakage prevention system, strengthen the customer data protection mechanism, improve the level of information security protection comprehensively, and establish a safe and reliable operating environment. The purpose of collecting customer data, the method of use and the exercise of related rights and interests are all stated in the notice of consent or contract to help customers fully understand the rights and obligations of both parties.

Company employees dedicated to the protection of personal information act based on the relevant rules of the company to appropriately handle and provide feedback on such matters, and appropriate rules are set and revised. At the same time, education and training program within the company has been enhanced and case studies and educational materials are created so that improvements of our business processes and the rigor of our internal rules will reduce the occurrence of customer complaints.