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Risk
Management
With a view to boosting corporate governance and responding to the needs of stakeholders, Gamania has established the “Risk Management Committee” in August 2023 upon the approval of the Board of Directors, in order to build a total risk management and control system pursuant to the provisions of the “Corporate Governance Best-Practice Principles for TWSE/TPEx Listed Companies”to identify and manage risks in all aspects of business administration, and further achieve sustainable management.
To respond to risks in an effective manner, the Auditing Office not only has three lines of defense of internal control in place with the respective roles, functions and scope of responsibilities thereof clearly defined, but also conducts annual audits and prepares an audit progress control sheet and a summary of findings and improvements. These practices help maintain Gamania’s sound corporate image and safeguard businesses against risks to allow more stable growth.
The Company’s Risk Management Committee is chaired by the Chairman, with the CFO serving as the convener and the senior executives of all units as the members. The committee meets at least twice a year, and the directors, managers of relevant departments, internal auditors, accounting or legal advisors, etc. may be invited to attend the meetings if necessary. The committee is responsible for formulating the Company’s risk management policies and framework as well as the implementation of strategies for relevant risk appetite, and reports to the Board of Directors annually to supervise the operation and overall implementation of the risk management mechanism. Members of the Board of Directors and the Risk Management Committee also receive certain hours of continuing education every year to enhance the ability to oversee and implement corporate risk management practices.
Gamania identified relevant stakeholders and operational issues based on the industry characteristics, developed a risk matrix based on the potential risks and their impacts on the Company (the table below presents the major risks of the year), formulated countermeasures accordingly, and regularly monitored the implementation effectiveness.
| Risk impact description | Countermeasure | Monitoring period | |
|---|---|---|---|
| Information security risks | To Gamania, an Eco-Internet Enterprise, internal and external information security risks will cause serious damage. For example, external malicious intrusions and cyberattacks, insufficient information security awareness of internal personnel, and new virus threats may result in abnormal or disrupted system operations, data alteration and damage, which could considerably impact the Company's operations. | In the face of the ever-changing impact on information security, the Company has explicitly designated the "Information Security Committee of the Group" as the highest guiding organization in terms of information security, which is supervised by the CEO in person. Aside from formulating corresponding information security policies as per the law for deploying information security defenses, it also implements various information security management tasks based on the risk management cycle, and irregularly review the Company's existing information security practices to formulate improvement plans, with a view to comprehensively managing the digital assets of customers and members. For more information, please refer to "2.2.1 Information security management." | Irregular (the committee meets once every half a year) |
| Risks of product-related customer complaints and litigation | The products and services provided by Gamania are changing, diversified and innovated over time. Hence, it is likely that omissions and deficiencies exist in the process of service provision, which could make consumers suffer from losses and further result in legal problems. | Gamania has always maintained close communication and interaction with consumers, and is committed to protecting consumers' interests. We have 24/7 customer service in place and a diversity of service channels available to listen to consumers' voices. In response to the omissions that have occurred, Gamania has made corrections and compensated the players and users right away, and further enhanced the pre-verification and communicated with the original manufacturer to develop more detailed verification tools. Meanwhile, relevant internal regulations have been established to reinforce the internal control mechanism so that the recurrence of risks is avoided. For more information, please refer to "2.3.1 Service and communication." | Anytime |
In order to identify potential emerging risks to the Group, Gamania identifies emerging risks and develops risk mitigation measures with reference to the reports on emerging risks released by external organizations (e.g. the Global Risks Report of WEF), internal managers’ operational concerns, and the management’s opinions compiled. The identified risks and developed measures are reported to the Risk Management Committee for early deployment and response.
| Risk item | Risk impact description | Countermeasure | Monitoring period |
|---|---|---|---|
| User scams | Advancements in networking and information technologies have given rise to new social problems such as scams and theft of game accounts. GASH users have become victims, which has impacted the Company's reputation. | To solve and avoid potential social problems, the Gamania team takes the initiative to confront the offenders together with consumers. We have collaborated with the anti-scam website (165) to leverage the strengths of law enforcers and digital transformation, in order to help ensure that consumers and law enforcers are able to deal with fraudulent behaviors stemming from digital games and online consumption promptly. For more information, please refer to "2.2.2 Protection of network security." | Irregular (usually once a week) |
| Extreme climate change | According to the annual Global Risks Report published by the World Economic Forum, climate change has risen to one of the top three risks in recent years. As a result, we began to check whether our assets, supply chain, or products and services are likely to be affected by climate change and cause new problems. | In 2023, Gamania introduced the TCFD (Task Force on Climate-Related Financial Disclosures) project to inventory the Company's potential impacts caused by short- or long-term natural disasters, and implemented countermeasures in relation to the locations of data center construction, the climate resilience of software and hardware facilities of office buildings, etc. in advance. For more information, please refer to "3.1.1 Response to climate change." | Once a year |