Climate Change Data

Environmental Metrics

ESG Focus Areas

• Environmental Protection
• Employee Welfare
• Ethical Corporate Management

Environmental Achievements

• Implemented energy conservation measures (e.g., efficient air conditioner use, paperless office)
• Obtained SONY GP (green procurement) certification

Social Achievements

• Provided employee benefits exceeding legal standards (flexible holidays, various insurance types, personal retirement accounts)
• Maintained open communication channels with employees
• No labor disputes reported

Governance Achievements

• Established Audit Committee and Compensation Committee
• Implemented Directors' recusal policy for personal interests
• Conducted Board of Directors performance evaluations

Climate Goals & Targets

Environmental Challenges

• Significant competition in the semiconductor market
• Customer concentration

Mitigation Strategies

• Leveraging proprietary technology to develop higher-performance, integrated, and lower-cost products
• Expanding customer base through investment in sales and product support

Supply Chain Management

Responsible Procurement

• Conflict Minerals Statement
• Due diligence on suppliers to confirm conformance with Conflict Minerals regulations

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: GRI Standards: Core option

Certifications: SONY GP (green procurement)

Environmental Metrics

ESG Focus Areas

• Environmental policy
• Climate change
• Employee relations and career development
• Law compliance

Environmental Achievements

• Reduced Scope 1 and 2 emissions from 3,055 tCO2e in 2020 to 3,325 tCO2e in 2021; reduced emissions intensity from 0.200 tCO2e/million NTD revenue to 0.166 tCO2e/million NTD revenue.

Social Achievements

• Increased number of employees from 581 in 2020 to 670 in 2021, with 436 engaged in R&D; female employees and supervisors accounted for 32.5% of all employees, and female supervisors accounted for 21.5% of all managerial positions; no occupational accidents in 2021; provided various employee welfare benefits exceeding statutory requirements; implemented employee training programs.

Governance Achievements

• Established Audit Committee; implemented Directors' recusal policy; conducted Board and Audit Committee meetings; established internal control systems; implemented ethical management practices; established whistle-blowing programs; disclosed corporate governance information on the company website and MOPS.

Climate Goals & Targets

Environmental Challenges

• Global semiconductor capacity shortage; potential risks related to changes in economic or political environments in various operating countries; potential risks related to the recognition and enforcement of civil judgments obtained in ROC courts in Cayman Islands, US, China, and Hong Kong; climate-related risks (transition risks due to stricter regulations and market shifts, physical risks due to extreme weather events).

Mitigation Strategies

• Reached wafer manufacturing expansion agreements with partners; redesigned and requalified high-volume products for multiple FABs; implemented risk management policies; developed alternative sourcing strategies; established emergency response teams; complied with ES Law; followed the rules set out in the Company’s article of association and the Companies Law (2021 Revision) of Cayman Islands; sought legal advice to comply with relevant laws and regulations; implemented internal control systems; established whistle-blowing programs; promoted energy saving and carbon reduction.

Supply Chain Management

Responsible Procurement

• Requiring suppliers to conduct due diligence to confirm conformance with Conflict Minerals regulations and provide investigative reports; working with suppliers to find alternative sources for conflict metals; tracking and encouraging suppliers to obtain environmental management certifications.

Climate-Related Risks & Opportunities

Physical Risks

• Typhoons and floods
• Extreme variability in weather patterns

Transition Risks

• Stricter regulations of greenhouse gas emissions
• Market shifts towards sustainable products

Opportunities

• Development of energy-efficient products

Reporting Standards

Frameworks Used: GRI Standards: Core option

Certifications: SONY GP (green procurement)

Environmental Metrics

ESG Focus Areas

• Employee relations and talent cultivation
• Corporate governance and law compliance
• Supply chain management
• Climate change action

Environmental Achievements

• Reduced Scope 1 and 2 emissions from 3,564 tCO2e in 2022 to 3,410 tCO2e in 2023
• Promoted internal energy saving and asked suppliers to meet international environmental certification standards

Social Achievements

• Maintained good relationships with customers and provided efficient communication processes dealing with customers' claims for products and services
• Formulated the Worldwide Business and Ethics Code of Conduct, management policies and procedures in accordance with applicable laws and regulations
• Female employees and supervisors accounted for 30.2% of all employees, and female supervisors accounted for 19.0% of all managerial positions

Governance Achievements

• Established the Audit Committee
• Implemented Rules of Conduct with Respect to Inside Information and Trading
• Strengthened IT team capability and capacity and modernized network infrastructure to improve security

Climate Goals & Targets

Environmental Challenges

• Severe correction in the consumer electronics industry in 2023, resulting in significantly decreased demand for integrated circuits (ICs) and excessive market inventory
• Pandemic boom busted starting in the 2nd half of 2022
• Significant competition in the semiconductor market

Mitigation Strategies

• Aggressively managed the business downturn to cut down on non-essential spending and reduce manufacturing activities
• Renegotiated with wafer foundries and OSATs to cut down obligations of Long-Term Agreements (LTAs)
• Initially focused on the reduction of inventory in distribution channels
• Strengthened high-speed product portfolio with new high-speed devices
• Developed leading high-speed technologies and products
• Leveraged proprietary equalizer and clock and data recovery technology to develop higher performance, more highly integrated and lower cost products

Supply Chain Management

Responsible Procurement

• Requiring suppliers to conduct due diligence to confirm conformance and to regularly provide investigative reports based on the latest Conflict Minerals Investigation Template (CMRT) released by Responsible Minerals Initiative (RMI)

Climate-Related Risks & Opportunities

Physical Risks

• Extreme climate events may disrupt the supply chain, affecting the supply and delaying product delivery, thereby impacting profits
• Extreme weather can affect the safety and efficiency of the office environment

Transition Risks

• Possible stricter regulations of greenhouse gas emissions may apply
• The market may gradually accept sustainable concept products, and existing products or services are replaced

Opportunities

• Investing in R&D to develop advanced and energy-saving products in response to market trends

Reporting Standards

Frameworks Used: GRI Standards 2021