A conflict of interests may arise when a director or supervisor takes actions or has interests that might make him/her difficult to perform the director’s or supervisor’s duty objectively and effectively. Conflict of interests will arise where a director or supervisor, or the director’s or supervisor’s spouses, children or relatives within the second degree, receives improper personal benefits because of the director’s or supervisor’s position in the Company. Directors or supervisors shall not have a direct economic relationship with the Company unless otherwise authorized by Chunghwa’s Board of Directors (hereinafter referred to as the “Board”). 

Loans to or guarantees in favor of directors, supervisors, senior managers or their spouses, children, and relatives within the second degree are prohibited in order to avoid from conflict of interests. Loans to other personnel shall be reviewed and approved in advance pursuant to the Company’s rules. 

While potential conflict of interests involving directors, supervisors, or senior managers shall be reviewed directly by the Board, those of other personnel of the Company shall be reviewed in accordance with the Company’s relevant regulations. The relevant activities may be permitted if they are determined to be not harmful to the Company. 

## Article 4 No appropriation for personal gains 

Directors, supervisors, managers, and employees have a duty to protect the Company’s legitimate interests. Unless the Company otherwise agrees, any individual shall not take advantage of the Company’s assets, information or its position to obtain personal interests. 

Any person is prohibited from competing with the Company unless it is otherwise approved in writing by the Company’s Human Resources Department in advance. 

## Articles 5 Caring for Employees 

Employees are the most important assets of the Company. The Company’s sustainable development relies on excellent employees who have realized their dreams in an excellent working environment and abundant business opportunities. The Company’s management shall be in compliance with the following requirements: 

## Article 6 Keeping trade secrets 

1. Complying with labor related laws and regulations; 

2. Treating each employee fairly, openly, and justly; 

3. Caring for employees, respecting employees, and listening to the mployees; 

4. Motivating employee’s innovation and passion toward the Company; 

5. Providing employees with a safe, healthy, and sanitary working nvironment; 

6. Striving to improve working conditions; 

7. Protecting employee’s legitimate rights and interests; 

8. Improving harmony relationship between employer and employees; 

9. Creating working opportunities of employees and value; and 

10. Implementing the compliance with collective bargaining agreement. 

“Trade secret” is defined under this Code of Ethics to include all the Company’s trade secrets and information that is obtained from or through business or cooperative relationship which shall be kept confidential. The Company’s directors, supervisors, managers, and employees shall keep the trade secret they obtain in confidential, except where a disclosure is required by applicable laws, rules or regulations or authorized by the Company. 

## Article 7 Disclosing the Company’s information in a full, fair, accurate, timely, and understandable manner 

All the Company related transactions and any disposition of assets shall be reflected in the accounts, financial statements and records of the Company in a full, fair, accurate, and timely manner. 

All directors, supervisors, managers, and employees handling the Company’s disclosure process are required to know and understand the relevant rules with respect to disclosure requirements within the scope of their duties and shall ensure that information in documents that the Company files with or submits to the Securities and Futures Bureau, Financial Supervisory Commission, Executive Yuan, R.O.C (hereinafter referred to as “SFB”) and the U.S. Securities and Exchange Commission (hereinafter referred to as “U.S. SEC”), or information otherwise disclosed to the public, is 

