Suppliers’ Sustainability Management Policy

The Company develops the long-term and high-performance cooperative relationship with its suppliers and achieves the supplier policy upholding “Suppliers as Partners, Implementation of Sustainable Procurement, Co-creation of Win-Win Situation for Common Good” through risk assessment, audit and certification on the environment, social and governance (ESG) practices.

Supplier Management Strategies

  1. Quality first: to acquire the optimum quality products and services.
  2. Value consideration: to continue improving the supply chain with the most valuable competitiveness.
  3. Diversified supply: to seek more than two supply sources for the same raw materials to ensure the sustainable supply of raw materials.
  4. Sustainable procurement: to improve the suppliers’ performance in sustainability of the environment, social and economic practices.
  5. Responsible minerals: to ensure that the suppliers adopt non-conflict minerals from reliable sources.

Suppliers' Sustainability Management Procedure

  1. Guidelines
    • Execute the “Procurement Agreement” and “Supplier Code of Conduct”.
    • Control the assessment on the six indicators including the suppliers’ quality/delivery period/cost/labor safety/environment/forced labor.
  2. Risk Assessment
    The assessment on new suppliers constitutes an important part of the management system. The critical and high-risk new suppliers identified based on the risk assessment on ESG (environment, social and governance) shall comply with the ISO management system and the Company’s related guidelines as following, in order to lay the solid foundation for high-performance cooperation with the Company and practice the goal for sustainability:
    • Environment-ISO14001
    • Social-ISO45001, Forced Labor Due Diligence Compliance Code
    • Governance-ISO9001
  3. Audit and Certification
    • Comply with the “Supplier Management Procedure,” “Standard Operating Procedure for Supplier Quality Management” and “Forced Labor Due Diligence Compliance Code.”
    • The Company shall conduct the on-site audit on domestic suppliers.
    • The Company/a third-party company contracted by the Company shall conduct the on-site audit or questionnaire on foreign suppliers.
  4. Continuous Improvement
    • Execute work in accordance with the “Supplier Management Procedure.”
    • Provide the counseling service and suggestions for the improvement measures during the audit.
    • Demand that the suppliers should make corrections in the audit report.
    • Reduce the trading volume or cease trading with the contractor which cannot meet the standards based on the results of more than two audits consecutively.

Key suppliers’ achievement in certificates/licenses

System certification

Number of qualified suppliers

Proportion (%)

ISO 9001: Quality Management System22100%
ISO 14001: Environment Management System1673%
ISO 45001: Occupational Health and Safety Management System1359%
Investigation period: May 2023

Assessment on suppliers’ sustainability-selection criteria

The Company values the suppliers’ sustainability management, and focuses on the requirement toward suppliers’ ESG practices. Environmentally, all suppliers agree to work with the Company to improve the environmental protection measures against energy, waste and water and electricity resources. Socially, all of the suppliers are aware of the possibility of certain impacts posed to the Company's operations, in terms of the risk management.

In response to the suppliers’ sustainability management, the Company establishes the “Supplier Management Committee” and sets forth the “Supplier Assessment Mechanism” to manage, evaluate, guide and follow up the improvement made by the suppliers regularly. The subjects regulated by the “Supplier Assessment Mechanism” refer to the key raw materials suppliers, which will be assessed based on the six indicators including the suppliers’ quality/delivery period/cost/labor safety/environment/forced labor.

The Company demands that all suppliers should execute the “Procurement Agreement” and “Supplier Code of Conduct” and should strictly comply with the Supplier Code of Conduct and its social responsibility requirements. The suppliers shall also demand that all of their own suppliers should adopt and comply with the Code, and conduct the assessment on its own suppliers regularly. The environmental protection or hazardous substance management certificates (ISO14001 or ISO45001) or Code of Conduct-RBA already received by the suppliers, if any, may serve as the basis for bonus points granted to the suppliers, as an incentive to guide and urge all suppliers to comply with the same.

Supplier Code of Conduct
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