Sustainable Governance

Risk Management

Billion Group establishes appropriate measurement methods for risks as the basis for risk management. After assessing and summarizing risks, appropriate response measures should be taken for the risks faced. In order to ensure the stable operation and sustainable development of Billion and serve as the basis for various risk management and implementation, it is planned to formulate risk management policies and procedures in 2023. The policies and procedures are in accordance with the "Regulations Governing Establishment of Internal Control Systems by Public Companies" issued by the Financial Supervisory Commission. Public companies are advised to establish appropriate risk management policies and procedures and establish an effective risk management mechanism to assess and monitor their risk tolerance, current risk tolerance, determine risk response strategies and compliance with risk management procedures.

Risk Management Organization Structure

  • Board of Directors

    As the highest level of risk management, it aims to promote and implement risk management as a goal, in accordance with the overall operating strategy and environment, and in compliance with the law. It aims to clearly understand the risks Billion facing in operation, ensuring the effectiveness of risk management, and bear the ultimate responsibility.

  • General Manager's Office

    Responsible for planning and directing the execution of the board's risk management decisions, coordinating the risk of cross-department interaction and communication to reduce strategic risks.

  • Functional Units

    Responsible for analyzing, managing, and monitoring relevant risks within the respective units to ensure the effective implementation of risk control mechanisms and procedures.

  • Internal Audit

    As an independent unit under the Board of Directors, it assists the board in overseeing the implementation of the risk management mechanism, audits the execution status of risk response and control in various functional units, and provides improvement suggestions for risk monitoring.

Risk Management Process

Relevant Risk Management Policies and Strategies

Risk Implementation after 2022 Assessment

  • With the successive signing and implementation of regional trade agreements and the influence of strong country competition, the global business and trade environmenthas changed dramatically in recent years, with multinational companies being particularly affected. Looking back at the 2008 financial crisis, the 2019 US-China tradewar, the COVID-19 pandemic in 2020, the logistics problems caused by COVID-19 in 2021, and the Russia-Ukraine war in 2022, which caused global inflation to intensify,businesses have faced considerable impacts and huge challenges. Therefore, risk identification, management, and mitigation are aspects that the Group must pay attention
  • Risks that affect the Company's normal operations in the production and operation process, such as sales/procurement concentration, supply chain management,corporate image building and maintenance, etc.Impacts
  • Potential Positive Impact: For a company to operate sustainably, it must consider various possible risks and minimize them or even turn them into opportunities.
  • Potential Negative Impact: The Russia-Ukraine war may lead to increased raw material and transportation costs, while energy storage projects demand substantial funds.Additionally, when energy-related regulations change or risks accelerate too quickly, it will lead to increased capital costs.

  • Economic performance is key to a company’s survival. Stable profitability and continuous growth are the main factors that enable sustainable development and fulfillment of social responsibilities, and are also issues of concern to stakeholders.

  • Actual Positive:Positive growth in economic performance increases investors’ investment in Billion. There is strong market demand for high-quality products and services, and significant results have been achieved in the development and investment in green energy and energy storage.

  • Potential Negative:Rapid changes in industry trends and market conditions, and numerous competitors may cause oversupply.

Risk Implementation and Practice after 2023 Assessment

Billion Group establishes appropriate measurement methods for risks as the basis for risk management. After assessing and summarizing risks, appropriate response measures should be taken for the risks faced.

Reaction

Exchange Rate Risk

  1. In response to significant changes in exchange rates, the company employs appropriate financial instruments such as USD fixed deposits and bond repo transactions as hedging measures to mitigate exchange losses.
  2. A portion of the sales contracts is denominated in USD, and corresponding purchases are paid in USD to mitigate exchange rate risk in accounts receivable and payable.
  3. The finance department collects relevant information from partner banks to serve as a basis for future reference regarding interest rates and exchange rate trends.

Regulatory Risk

The business team keeps up with energy-related regulations, actively participating in discussions and seminars, and promptly providing feedback on regulatory conditions to facilitate management decision-making.

Reaction

 Liquidity Risk

Optimize the forecasting mechanism for collection and payments and implement a professional fund scheduling model to reduce liquidity risk.

Reaction

 Inventory Risk 

Optimize cross-functional communication mechanisms between sales, finance, procurement, and materials, with appropriate fund allocation and warning signals, providing management with decision-making information.


Customer Risk

Through export insurance, bank accounts receivable management, and other mechanisms, we aim to control customer risks and effectively manage account recovery.


Contract Risk

Optimizing the legal audit mechanism, consistently conveying the importance of risk awareness to all personnel. This involves professional reviews of various contracts, legal consultations, and educational training provided by experts.


Personnel Risk

Convene a meeting to assess the company's welfare and personnel planning initiatives. Additionally, recruit external professionals to enhance employee care, conduct a manpower inventory, and implement education and training as part of our talent cultivation and retention strategy.

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