Climate Change Data

TAIWAN SEMICONDUCTOR CO., LTD

Climate Impact & Sustainability Data (2021, 2022, 2023)

Reporting Period: 2021

Environmental Metrics

Total Carbon Emissions:3883 tCO2e/year (indirect emissions at Lize plant)
Scope 1 Emissions:0.4389 tCO2e/year (Meizhou plant)

ESG Focus Areas

  • Environmental
  • Social
  • Governance

Environmental Achievements

  • Reduced waste by 0.5% in 2021 (from 0.001 tons/piece to 0.0009 tons/piece)
  • Reduced wastewater by 0.5% in 2021 (from 0.347 tons/piece to 0.295 tons/piece)
  • Reduced CO2 emissions by 0.5% in 2021 (from 0.013 tons/piece to 0.107 tons/piece)

Social Achievements

  • Established employee welfare committee to handle employee welfare matters
  • Implemented various employee training programs
  • Actively participated in public welfare activities (donations, etc.)

Governance Achievements

  • Established an audit committee to replace the supervisor position
  • Implemented a director selection system based on candidate nomination
  • Established a salary and compensation committee to evaluate compensation policies

Climate Goals & Targets

Short-term Goals:
  • 1% reduction in wastewater (11,580 tons base year)
  • 1% reduction in waste (25.7 tons base year)
  • 1% reduction in carbon emissions (3705 tons base year)

Environmental Challenges

  • Low-price competition from Chinese semiconductor manufacturers
  • Rising raw material and labor costs
  • High dependence on foreign sales, making profitability susceptible to exchange rate fluctuations
Mitigation Strategies
  • Focus on higher specification products
  • Introduction of higher-end automated production equipment
  • Close strategic cooperation with major chip suppliers and foundries

Supply Chain Management

Responsible Procurement
  • Evaluation of suppliers' environmental and social records
  • Requirement for suppliers to promote ISO certifications
  • Contracts with major suppliers include clauses on corporate social responsibility

Climate-Related Risks & Opportunities

Opportunities
  • Development of energy-efficient products

Reporting Standards

Frameworks Used: GRI, RBA

Certifications: ISO 9001, ISO/TS16949, ISO14001, OHSAS18001, ISO14064, IATF16949, SGS ROHS

Sustainable Products & Innovation

  • Low energy consumption products

Reporting Period: 2022

Environmental Metrics

Total Carbon Emissions:4356.56 tCO2e/year (Lize Plant 2020) + 0.3599 tCO2e/year (Meizhou Plant 2022)
Scope 1 Emissions:0.3599 tCO2e/year (Meizhou Plant 2022)
Scope 2 Emissions:3997 tCO2e/year (Meizhou Plant 2022)

ESG Focus Areas

  • Climate Change Mitigation and Strategy
  • Employee Safety and Health
  • Responsible Products
  • Environmental Pollution Prevention
  • Human Resource Management
  • Customer Relationship Management

Environmental Achievements

  • Reduced CO2 output per film by 0.0013 metric tons (11.9% decrease)
  • Wastewater emissions in 2022 were 5.7% lower than in 2021
  • 100% recycling rate of wastewater and sludge

Social Achievements

  • Established employee welfare committee
  • Regular labor-management meetings
  • Suggestion box and staff opinion surveys
  • Annual health check-ups and health promotion manuals

Governance Achievements

  • Established Audit Committee
  • Implemented candidate nomination system for directors
  • Regularly evaluates the independence and competence of CPAs

Climate Goals & Targets

Short-term Goals:
  • 1% annual reduction in wastewater, waste, and carbon emissions (Meizhou Plant)

Environmental Challenges

  • Low-price competition from Chinese semiconductor manufacturers
  • Domestic labor shortages and rising wages
  • High dependence on foreign sales and exchange rate fluctuations
  • Fluctuating global raw material prices
Mitigation Strategies
  • Focus on higher specification products
  • Introduction of higher-end automated production equipment
  • Close strategic cooperation with major chip suppliers and foundries
  • Global strategizing strategy
  • Diversified product portfolio
  • Flexible marketing strategy

Supply Chain Management

Responsible Procurement
  • Evaluation of suppliers' environmental and social records
  • Encouragement of ISO certifications
  • Contracts with good faith clauses and termination clauses for CSR violations

Climate-Related Risks & Opportunities

Opportunities
  • Development of energy-efficient products

Reporting Standards

Frameworks Used: GRI, SASB

Certifications: ISO 9001, ISO/TS16949, ISO14001, OHSAS 18001, ISO14064, IATF16949, SGS ROHS

Sustainable Products & Innovation

  • Low energy consumption products

Reporting Period: 2023

Environmental Metrics

Total Carbon Emissions:7935 tCO2e/year (2023)
Scope 1 Emissions:7897 tCO2e/year (2023)
Scope 2 Emissions:14128 tCO2e/year (2023)
Water Consumption:7.31 million liters/year (2023)
Waste Generated:934 tons/year (2023)
Carbon Intensity:0.54 metric tons CO2e/NT$ million (2023)

ESG Focus Areas

  • Sustainability
  • Climate Change
  • Greenhouse Gas Emissions
  • Renewable Energy
  • Waste Reduction
  • Human Rights
  • Labor Standards
  • Supply Chain Management

Environmental Achievements

  • Reduced total waste by 213 metric tons in 2023 compared to 2022.
  • Achieved 100% reuse rate of calcium fluoride sludge at Lize factory.
  • Reduced total energy consumption by 9,299.15 GJ in 2023.
  • Lize Factory implemented ISO 50001 Energy Management System and passed UCS verification.

Social Achievements

  • Launched various employee welfare measures, including festivals bonuses, education scholarships, marriage bonuses, birthday bonuses, and condolences.
  • Average training hours per employee were 119.79 hours in 2023.
  • Female employees accounted for 57.8% of the workforce in 2023.
  • Implemented measures to ensure a safe and healthy working environment, resulting in only 2 occupational accidents in 2023 (0.001% of total workforce).

Governance Achievements

  • Established a Corporate Sustainability Committee in May 2022.
  • Implemented the TCFD framework to quantify the financial impacts of climate change.
  • Established an effective accounting system and internal control system.
  • Regularly conducts internal and external education and training on integrity management.

Climate Goals & Targets

Long-term Goals:
  • Disclose complete inventory information of the consolidated company for the year 2026 by 2027, as well as for the year 2028 by 2029, along with assurance status.
Medium-term Goals:
  • Develop short-term and mid-term carbon reduction plans.
Short-term Goals:
  • Reduce energy consumption and carbon emissions by at least 1% annually at production sites.

Environmental Challenges

  • Sluggish demand and delivery dynamics due to excessive inventory levels and lower-than-expected revival of market demand.
  • Competition from Chinese semiconductor manufacturers due to government subsidies.
  • Climate change risks, including increased costs of greenhouse gas emissions, growing demand and regulations related to sustainability, changes in customer behavior, increasing raw material costs, expenditures associated with transitioning to low-carbon technologies, increased negative feedback from stakeholders, and an increase in extreme weather events.
Mitigation Strategies
  • Actively deploying in automotive electronics, industrial controls, servers, and analog ICs.
  • Optimizing after-sales managed services and improving customer service quality.
  • Developing higher specification products and occupying areas with higher entry barriers.
  • Implementing the TCFD framework to identify and evaluate climate risks and opportunities.
  • Developing corresponding mitigation measures for climate change risks.
  • Implementing energy-saving and carbon reduction initiatives.

Supply Chain Management

Responsible Procurement
  • RBA Supplier Code of Conduct
  • Third-party vendor management operating procedures

Climate-Related Risks & Opportunities

Physical Risks
  • Increased extreme weather events
Transition Risks
  • Increased costs of greenhouse gas emissions
  • Growing demand and regulations related to sustainability
  • Changes in customer behavior
  • Increasing raw material costs
  • Expenditures associated with transitioning to low-carbon technologies
  • Increased negative feedback from stakeholders
Opportunities
  • Improving energy efficiency of products
  • Implementing production and distribution processes with better effectiveness
  • Participating in renewable energy programs

Reporting Standards

Frameworks Used: GRI Standards 2021, TCFD framework, SASB Semiconductors Sustainability Accounting Standard 2018, Sustainable Development Best Practice Principles for TWSE/TPEx Listed Companies

Certifications: ISO 9001, IATF 16949, ISO 14001, ISO 50001, ISO 45001, ISO 14064

Third-party Assurance: TUV