How can enterprises cope with the nine major new securities systems in 2026

        To enhance the transparency of the capital market, align with international sustainable standards, and strengthen market competitiveness, Taiwan Stock Exchange Corporation TWSE Starting from 2026, nine new systems will be introduced, covering areas such as information disclosure, corporate governance, sustainability development, and capital market system optimization. This article will explain the main purposes of these new systems and the impacts they will bring to enterprises.

        Comprehensive electronicization of financial report declaration

                Starting from 2026, listed companies are required to upload their first quarter financial reports and related attachments in electronic format to designated information platforms instead of paper submissions.

        Main purpose: To shorten the review process, improve the efficiency of information disclosure, data management and supervision by regulatory authorities, and reduce administrative costs such as printing and shipping for enterprises.

        Main impact: Enterprises need to further promote the digitization and standardization of financial processes, and review financial information systems and file management mechanisms to ensure that electronic file formats comply with declaration standards. If a complete file conversion and upload process is not established, it may affect the efficiency of application and the quality of information disclosure.

        Strengthen employee compensation and gender pay disclosure

        The new system expands the scope of employee salary disclosure for listed companies, requiring companies to declare the salary adjustment or distribution of grassroots employees. In addition, listed companies with a capital of NTD 10 billion or more are required to disclose the median and average gender salaries of non managerial employees.

        Main objective: To enhance the transparency of human capital information, improve gender pay gap issues, and promote fairness in corporate compensation systems.

        Main impact: Publicizing salary information will make the internal salary structure of the company more transparent. If there is a significant gender pay gap, it may affect the company's image and ESG evaluation. Therefore, companies should review relevant systems in advance to ensure fairness and reasonableness.

        Independent Director Declaration and Qualification Inspection Application System Launched

        The Stock Exchange has established an "Independent Director Declaration and Qualification Inspection System" at the Public Information Observatory. Companies are required to declare their independent director declaration through an online system and have the system assist in checking their qualifications.

        Main purpose: To enhance the independence of the board of directors, prevent unqualified individuals from serving as independent directors, and thereby increase the transparency of corporate governance.

        Main impact: The comprehensive electronicization of the nomination and review process for independent directors can improve administrative efficiency, reduce the risk of errors in paper-based operations, and strengthen the supervisory authority's ability to promptly verify the qualifications of directors.

        Electronic and searchable annual reports of shareholders' meetings

        The new regulations stipulate that the annual report of the shareholders' meeting of listed companies will no longer be provided in paper form and must be uploaded in electronic format with text search function.

        Main purpose: To increase the transparency of corporate information disclosure, improve the convenience of investors in accessing information, and reduce paper usage to comply with sustainable principles.

        Main impact: Electronic annual reports will improve investors' reading efficiency, while also requiring companies to be more rigorous in the format of annual report preparation and file output to ensure the completeness and searchability of documents. Enterprises can also take this opportunity to optimize the way information is presented, increase the readability of annual reports, and improve communication with investors.

        Adhere to IFRS perpetual disclosure standards

        All publicly traded entities are required to develop an import plan and gradually align with the IFRS Sustainability Disclosure Standards to disclose relevant sustainability information.

        Main purpose: To meet the requirements of global capital markets for climate risk and sustainable information disclosure, align with international standards, and enhance the transparency and investor trust of Taiwanese companies.

        Main impact: When companies disclose sustainable information, they need to provide quantifiable and financially relevant data, such as the impact of climate risks on operational and financial performance, and establish a complete sustainable data management and internal control mechanism. At the same time, it is necessary to strengthen cross departmental cooperation in order to effectively respond to the requirements of international disclosure standards.

        Disclosure of greenhouse gas inventory and reduction information

        Under the ESG trend, corporate carbon emissions information has become an important disclosure item. In fact, as early as 2022, the Financial Supervisory Commission had stipulated in the "Publicly Owned Entity Sustainability Development Roadmap" that all publicly owned entities were required to disclose greenhouse gas inventory results, carbon emission reduction strategies, and climate risk management measures in stages; This new system further specifies that all listed companies should disclose greenhouse gas inventory (carbon inventory) and reduction related information in stages in their annual reports and sustainability reports.

        Main purpose: To respond to the global trend of net zero carbon emissions, improve the transparency of corporate environmental responsibility, and assist investors in assessing climate risks.

        Main impact: The new system requires companies to include greenhouse gas inventory and reduction information in their official annual reports, elevating the importance of "carbon emission data" to a level similar to financial information. To this end, enterprises need to establish a complete and reliable data collection and management system to ensure the accuracy and traceability of carbon emission information.

        Transforming corporate governance evaluation into ESG evaluation

        The original corporate governance evaluation system of the stock exchange will be upgraded to ESG evaluation, and the evaluation scope will be expanded to the three major aspects of environment, society, and governance.

        Main objective: To implement the transition from "corporate governance" to more comprehensive "sustainable governance".

        Main impact: The long-term implementation of the corporate governance evaluation system will gradually upgrade to an ESG evaluation system that covers three major aspects: environment (E), society (S), and governance (G). This shows that the focus of the supervisory authority's evaluation of enterprises has expanded from a single governance aspect to overall sustainability development. Therefore, companies need to establish a more comprehensive ESG governance framework to enhance overall sustainability performance.

        Formally promote the green securities certification system

        To encourage the development of sustainable finance in enterprises and continuously guide the flow of funds to enterprises with sustainable value, a green securities certification system is introduced. (Applicable to all publicly quoted entities, excluding the financial industry for now)

        Main purpose: To establish green finance standards, encourage enterprises to invest in green investments, and provide investors with identification of sustainable enterprises.

        Main impact: In order to avoid the suspicion of "greenwashing" caused by excessive claims of sustainable results by enterprises, the stock exchange promotes a green securities certification system, which guides market funds to flow to enterprises with substantial sustainable value by establishing objective standards. For enterprises, obtaining relevant certifications will help enhance visibility and trust in the capital market, and attract more attention from legal entities and sustainable funds that value ESG investment strategies. In the long run, it also helps to reduce the cost of fundraising and strengthen the competitive advantage of enterprises in sustainable financial markets.

        Optimizing the Conversion of Innovation Board to Board and Market System

        In order to enhance market competitiveness, the stock exchange continues to relax the innovation board system. In addition to allowing existing innovation board stocks to be used as benchmark stocks and loosening the investment quota for investment trust funds in innovation board stocks, the relevant regulations for the innovation board and foreign companies listing in Taiwan will be gradually revised in the future.

        Main purpose: To assist high growth enterprises in entering the capital market, strengthen the development of Taiwan's technology and new venture industries, and attract more companies to list in Taiwan.

        Main impacts: Opening up hedge trading can enhance market liquidity, shorten the sponsorship period can reduce maintenance costs for companies after listing, and the transfer mechanism between the Innovation Board and the Main Board can enable companies to switch between different market sectors according to their development stages, helping to create a more flexible capital market structure and enabling new startups with growth potential to obtain capital support faster, thereby enhancing the overall competitiveness of Taiwan's capital market.

        Overall, the nine new securities systems reflect the following three policy directions and demonstrate the determination of the regulatory authorities:

        Financial reports, salary disclosures, and annual reports are digitized, making information disclosure more transparent.

        Promote ESG evaluation, carbon disclosure, and IFRS sustainability standards to institutionalize Sustainability Development.

        Optimize the innovation board system and promote the development of green finance to enhance the competitiveness of the capital market.

        How companies internalize ESG into their DNA and manage data accurately through digital tools will be the key to future success.

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        *Image source: freepik

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