Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental Protection
• Employee Welfare
• Ethical Corporate Management

Environmental Achievements

• The Chinese subsidiaries of this Company (VT SZ, VT JY, and VT SZWT) have acquired wastewater discharge permits and water pollutant discharge permits. The Taiwanese subsidiary (VT TW) has obtained toxic chemical registry and stationary source operation and setup permits and has established dedicated environmental protection units with relevant personnel. Soil and groundwater pollution remediation fees, stationary source fees, and air pollution control fees are paid in a timely manner.
• VT SZ converts thermal energy generated by its air compressors and waste gas incinerators for use for its plant heating system.

Social Achievements

• Employee welfare measures adopted by this Company and its subsidiaries include wedding and funeral allowances, staff trips, bonuses, stock options, labor and health insurance, group insurance, and annual health checks as well as diverse opportunities for advanced training and workshops to broaden their horizons and increase their work efficiency.
• Special funds were also provided as scholarship/financial aid to support students of elementary and high schools located in indigenous rural villages which include funds used for financial stability support, learning provision, after-school care, material assistance, etc. to maintain children’s basic living needs and to facilitate their development of versatile skills.
• The company donated funds to GOOD LIVER FOUNDATION to support underprivileged residents in liver disease screening, proactive follow-up check-ups and early medical treatment

Governance Achievements

• The Company has formulated Ethical Corporate Management Best Practice Principles to regulate relevant policies of the Company.
• The Company has established an effective accounting and internal control system. Internal auditors regularly audit compliance with said system.
• The Company holds internal and external education and training for ethical corporate management periodically in line with actual needs.

Climate Goals & Targets

Environmental Challenges

• The CCL industry is still facing the problem of excessive production capacities and constant competition between same-industry businesses. Price pressures persist in a climate of fierce market competition.
• Increasing raw material and manpower costs
• Rising trade protectionism
• Brexit has led to an increased volatility of the European market.

Mitigation Strategies

• Constant provision of products at highly competitive prices, a close rapport with clients, a clear understanding of customer demands, and rapid service provision are therefore key requirements. The provision of high-quality product and sales services helps minimize negative impacts of price competition.
• Constant optimization of product mixes, active cultivation of exceptional talent for diverse fields, firm commitment to enhancement of employee work efficiency, maintenance of overall competitiveness, and maximization of economic benefits.
• Constant focus on global deployment, close contact with global clients and suppliers, maintenance of market sensitivity, and reduction of business risks.
• The Company has therefore strengthened the sales and technical teams of its German subsidiary to cope with the impact of Brexit on delivery efficiency and speed and mitigate unfavorable effects of Brexit.
• More support from banks is available due to the recent approval of the listing application in Taiwan. In addition, capital increase may be conducted in line with business expansion needs to enhance the financial structure and make steady strides toward corporate sustainability provided that profitability remains unaffected.

Supply Chain Management

Responsible Procurement

• The Company maintains long-term partnerships with at least two suppliers for main raw materials utilized for products that generate stable revenues from key clients.

Climate-Related Risks & Opportunities

Physical Risks

• extreme weather may all have a direct impact on the Company’s operations and increase losses

Opportunities

• changes to mitigate and adapt to climate change will create opportunities for the Group, such as the development of new products related to green energy technologies

Sustainable Products & Innovation

• lead-free and halogen-free eco-friendly metal substrates characterized by high thermal conductivity (7.0W/mK) for high-power LED applications and ultra-low Dk (Dk 3.0) halogen-free materials for next-generation smartphones

Environmental Metrics

ESG Focus Areas

• Environmental Protection
• Employee Welfare
• Ethical Corporate Management

Environmental Achievements

• Obtained ISO14001 and IECQ QC080000 certificates
• Reduced GHG emissions from 28,663 tons in 2018 to 29,744 tons in 2019
• Reduced water consumption from 207,337 m³ in 2018 to 189,644 m³ in 2019
• Reduced waste volume from 456 tons in 2018 to 519 tons in 2019
• VT SZ converts thermal energy generated by its air compressors and waste gas incinerators for use for its plant heating system.

Social Achievements

• Provided employee benefits including wedding and funeral allowances, staff trips, bonuses, stock options, labor and health insurance, group insurance, and annual health checks
• Organized staff trips and welfare measures
• Donated funds to GOOD LIVER FOUNDATION
• Provided scholarship/financial aid to students in indigenous rural villages
• Donated masks and medical supplies to customers, suppliers, and partners during the COVID-19 pandemic

Governance Achievements

• Established a Remuneration Committee and an Audit Committee
• Implemented the "Regulations Governing the Board Performance Evaluation"
• Enacted "Ethical Corporate Management Best Practice Principles"
• Established a whistleblowing system

Climate Goals & Targets

Environmental Challenges

• Impact from macroeconomic uncertain factors
• Shortage of raw materials and skyrocketing prices
• Global competition
• Impact from COVID-19 pandemic
• Fluctuations in raw material prices
• Rising competitive pressure
• Strict environmental standards
• Interest rate movements
• Exchange rate fluctuations
• Inflation pressures

Mitigation Strategies

• Focus on products with high profit margins
• Active development of new markets (5G, self-driving systems, e-vehicles)
• Establishment of long-term partnerships with customers and suppliers
• Constant quality enhancements and investments in automated and smart manufacturing
• Closely monitoring raw material market conditions and maintaining close partnerships with upstream manufacturers
• Procurement from different sources
• Development of high-end substrates and other niche products
• Establishment of marketing networks and development of new customers
• Adoption of other financing tools available on capital markets
• Selection of fixed interest or floating interest loans
• Tight control of foreign exchange transactions
• Timely adjustments based on actual conditions
• Close monitoring of market price fluctuations and timely adjustments of procurement strategies and cost structures

Supply Chain Management

Responsible Procurement

• Maintaining long-term positive partnerships with suppliers
• Careful evaluation of suppliers

Climate-Related Risks & Opportunities

Physical Risks

• Wind disasters, snow disasters, floods, and droughts

Transition Risks

• Changes to meet market demand for mitigation and adaptation to climate change

Opportunities

• Development of new products of green energy technologies that reduce pollution

Sustainable Products & Innovation

• Lead-free, highly heat resistant, halogen-free, eco-friendly materials
• Polyimide boards and materials with ultra-high heat resistance/low CTE properties
• Halogen-free, eco-friendly substrates
• Aluminum substrates

Environmental Metrics

ESG Focus Areas

• Corporate Social Responsibility
• Sustainable Development

Governance Achievements

• Amendments to the Practice Principles for Corporate Social Responsibility
• Amendments to the Articles of Association
• Amendments to the Rules of Procedure for Shareholders’ Meetings
• Amendments to the Regulations Governing the Acquisition and Disposal of Assets

Climate Goals & Targets

Environmental Challenges

• Unstable conditions under the COVID-19 pandemic caused every country in the world to adopt pandemic prevention and isolation strategies. The resulting halt in production among factories both domestically and overseas led to shortages in automotive chips, impacts on materials both short and long-term, and disruptions in land and ocean transportation. These developments were compounded by responses to energy saving and carbon reduction as well as electricity curtailment measures and other factors across China. Taken together, these factors had a serious impact on the global economy.

Mitigation Strategies

• Maintained focus on developing niche products and actively deploying to and cultivating the automotive market. Improved the lighting penetration rate of original automotive LED lights, engaged in development of new non-lighting energy applications; for example, in-vehicle chargers, power steering wheels, turbocharging of electronic engines, and large-scale machine tools. The aerospace and defense medical fields have grown significantly, and continued to deepen end certification of heat dissipation materials to provide customers with high-quality products and sales services.

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Environmental Protection
• Employee Welfare
• Ethical Corporate Management
• Sustainable Development

Environmental Achievements

• Obtained ISO14001 and IECQ QC080000 certifications.
• Reduced emissions (Scope 1 & 2) from 23,722 tCO2e in 2021 to 19,128 tCO2e in 2022.
• Reduced water consumption from 207,160 m³ in 2021 to 168,006 m³ in 2022.
• Reduced waste volume from 1,926 tons in 2021 to 1,725 tons in 2022.

Social Achievements

• Harmonious labor-management relations with no major disputes.
• Provides competitive salaries, performance incentives, year-end bonuses, and various insurance programs.
• Established comprehensive training programs for employee development.
• Implemented grievance mailbox for employee concerns.

Governance Achievements

• Established a Remuneration Committee and Audit Committee.
• Implemented “Regulations Governing the Board Performance Evaluation”.
• Appointed a Corporate Governance Officer.
• Established Ethical Corporate Management Best Practice Principles.
• Implemented a whistleblowing system.

Climate Goals & Targets

Environmental Challenges

• Ongoing war between Russia and Ukraine.
• Supply chain restructuring due to competition from major powers.
• General inflation and economic uncertainties.
• Raw material price fluctuations.
• Rising competitive pressure.
• Strict environmental standards.

Mitigation Strategies

• Develop materials for high-end products with special applications.
• Maintain steady growth in sales in automotive heat conducting products, military aerospace, and national defense medical care.
• Closely monitor raw material market conditions and maintain close partnerships with upstream manufacturers.
• Develop high-end substrates and niche products.
• Increase performance and reduce costs through substrate process and production capacity adjustments.
• Establish marketing networks and develop new customers.
• Purchase and update pollution control facilities, implement waste reduction plans, and develop new processes.

Supply Chain Management

Responsible Procurement

• Requires suppliers to comply with ISO9001, IATF16949, QC080000/ ISO14001/ISO45001 certifications.
• Requires products to meet RoHS, REACH, and local government regulations.

Climate-Related Risks & Opportunities

Physical Risks

• Climate change and natural disasters impacting supply chains.

Opportunities

• Development of new products of green energy technologies that reduce pollution.

Reporting Standards

Frameworks Used: IFRS

Certifications: ISO 9001, AS 9100C, IECQ, ISO 14001, IECQ QC080000, ISO 45001, IATF 16949

Third-party Assurance: Deloitte & Touche

Sustainable Products & Innovation

• Lead-free, highly heat resistant, halogen-free, eco-friendly materials
• Polyimide boards and materials with ultra-high heat resistance/low CTE properties
• Halogen-free and very high thermal conductivity IMS for ultra-light LED