Issue Date: August 3, 2023
Suppliers are important partners in our sustainable operations. Coretronic has 1,688 suppliers in the Taiwan and China plants (including 1,511 domestic suppliers, accounting for 90%, and 177 foreign suppliers). We classify and manage suppliers based on their characteristics and the goods/services they provide. We prioritize local procurement to promote local economic development, ensure operational stability, accelerate production efficiency, and minimize carbon emissions from transportation.
To achieve "sustainability and mutual benefit" with our suppliers, we have developed the "Sustainable Supplier Management Regulations" for production material suppliers. We require our suppliers to adhere to the regulations, conduct risk assessments and audits, provide training and guidance, and at the annual supplier conference, we acknowledge outstanding suppliers and discuss sustainability trends to ensure the sustainable operation of our suppliers. In addition, we have established the "RBA Code of Conduct Management Handbook" according to the RBA Code of Conduct to manage our suppliers. We urge our suppliers to prioritize ethical practices, labor rights, environmental protection, and health and safety issues. We thoroughly implement risk management and BCP to establish a sustainable supply chain. If our suppliers have any suggestions or inquiries about sustainability, please contact us at CSR@coretroic.com
Conflict metal refers to minerals from the conflict mining area of the Democratic Republic of the Congo. These minerals are refined into tantalum (Ta), tin (Sn), tungsten (W) (referred to as tri-T mineral), gold (Au), and cobalt (Co), which are used in electronics and other products, respectively. Some of the metal minerals have become the main source of financial resources for armed rebel groups in the African Democratic Republic of the Congo. They are used to trade arms, carry out bloody conflicts with the government, and desecrate local civilians. As a result, international disputes have arisen. As a global citizen, we recognizes that the exploitation, trading, processing, and exporting of mineral resources in conflict-affected and high-risk areas have risks that may cause major adverse effects, and we recognize that we have respect for human rights, do not contribute to conflicts and are not environmentally friendly. And society has a negative impact. We declare and promise not to accept the use of metals from conflict mining areas. At the same time, we also require our suppliers to:
We consider conflict-free minerals as key raw materials and manage them accordingly. We do not accept gold, tantalum, tin, tungsten, cobalt, and mica illegally mined from the Democratic Republic of the Congo and neighboring conflict regions. Therefore, we established a "Responsible Minerals Procurement Policy" and "Declaration on Non-Use of Conflict Mineral" based on the RBA Code of Conduct and added them to the "Supplier and Contractor Sustainability Commitment Statement." In addition, we announced conflict mineral control requirements to suppliers at the annual supplier conference. All production material suppliers must sign the "Supplier and Contractor Sustainability Commitment Statement" and comply with conflict minerals regulations. We also publish relevant policies and investigation results on our official website.
The Visual Solutions Business Group conducts a more detailed conflict minerals investigation on production material suppliers using RMI CMRT 6.22 and EMRT 1.11 questionnaires. The response rates are 94% and 91%, respectively. In the future, we will re-evaluate the recipients of the questionnaires and consider excluding customer-specified suppliers or suppliers who have declared their compliance with conflict minerals regulations. We will also guide non-compliant suppliers to make improvements to increase the response rate.
The Energy Saving Business Group conducts investigations on suppliers of production electronic materials using RMI CMRT 6.22, EMRT 1.02, and EMRT 1.11 questionnaires. The response rates are 100%.
【Visual Solutions Business Group】
【Energy Saving Business Group】
This platform includes the Announcement, Material Composition Declaration Request (MCD), and Supplier List sections. The Announcement section on the homepage provides information such as the updated green product specifications and GPMS training videos to help suppliers follow the correct regulations and use the correct forms. This section allows purchasers and engineers to check the upload status of supplier documents and maintain the directory of raw material suppliers. In addition, suppliers can fill in the RoHS 2.0, SVHC, and SDS information, and administrators can download reports according to the product model BOM.
To enhance suppliers' awareness of sustainability and help them become sustainable supply chains, the Online Green Supply Chain Platform was organized in 2022 that includes online courses, sustainability columns, uploading signed documents of sustainable supply chains, online sustainability questionnaire platform, and a conflict mineral survey. The platform will be built around 2023-2025.
To enforce the security management of supply chain trade, we hold AEO Trade Security Training Conferences regularly. In 2022, 42 suppliers attended the conference.
Since 2017, we have promoted responsible supply chain practices, working with suppliers to improve quality, cost, delivery, sustainability, safety, and health. We have improved our supply chain management through on-site counseling and face-to-face communication, fulfilling our sustainability commitments. To continuously strengthen supply chain resilience and improve adaptability, we organized two online sustainability supplier conferences in 2022, with 112 participants. The topics discussed include sustainability trends, climate change impacts on operations, net-zero targets, green supply chain initiatives, green manufacture, product concepts, and future plans. We will continue to work with our suppliers to achieve a win-win supply chain relationship. We encourage our supply chain partners to prioritize climate change issues and take more environmentally friendly actions to create a sustainable supply chain together.
|Location||Kunshan Plants||Wujiang Plants|
|Number of Participants||42||70|
★Kunshan plants: presented the "Energy Saving and Emissions Reduction Award," "Sustainability Award," and "Excellence Award" to 22 outstanding suppliers of the year. The "Energy Saving and Emissions Reduction Award" is presented to suppliers who recycle packaging materials and use reusable plastic frames for delivery. The "Sustainability Award" is presented to suppliers who completed deliveries during the pandemic, with priority given to Kunshan plants. The "Excellence Award" is presented to suppliers who made significant contributions to achieve customer demands despite the impact of the pandemic.
★Wujiang plants: presented the "Green Product HSF Excellent Management Award," "Energy Saving and Emissions Reduction Award," and "Sustainability Award" to 11 outstanding suppliers of the year. The "Green Product HSF Excellent Management Award" is presented to suppliers who provide materials complying with green product requirements and demonstrate excellent performance overall. The "Energy Saving and Emissions Reduction Award" is presented to suppliers who implement carbon-reducing measures during the transaction period, such as electricity conservation, water conservation, and waste management. The "Sustainability Award" is presented to suppliers whose supply performance and adaptability help improve the resilience of the supply chain system within a specified period.
We implement waste recycling programs with our suppliers to recycle packaging materials (e.g., plastics and paper) and use reusable packaging for shipping. Besides, we have reduced the raw material consumption for packaging or containers and promoted circular economy concepts, such as recycling and waste reduction, to protect the environment. In 2022, 14 suppliers participated in recycling acrylic protective sheets, cardboard boxes, trays, pallets, foam boxes, and other materials, achieving a 98% recycling rate.
The 2022 CDP Supplier Engagement Rating recognized Coretronic for outstanding performance. We achieved a leadership level score of A-, higher than the industry, Asian, and global average scores (C). Coretronic is committed to supplier partnerships and value chain partnership engagement for climate change mitigation and adaptation. The evaluation criteria include "Supplier Engagement," "Targets," "Scope 3 Emissions," "Overall CDP Climate Change Score," and "Governance." Coretronic achieved the leadership level score of A for 2 consecutive years in the "Supplier Engagement" and "Other Indirect GHG Emissions" categories. In the future, we will continue to invest in value chain management and work with our suppliers and customers to bring the best operational resilience.
We recognize the impact of the environmental footprint in the procurement of raw materials and components. Therefore, local procurement is a key strategy in finding suppliers. We also encourage our suppliers to prioritize local procurement to protect the environment. Please refer to the figure below for the procurement percentage in 2022. Among them, the Visual Solutions Business Group of the Taiwan and China plants (Kunshan) has a lower percentage of local procurement because the key components must be purchased from specific foreign suppliers to maintain product quality. Efforts will still be made to purchase other components locally.