Sustainable Development Status

Sustainable Development Status

Implementation of Sustainable Development and Deviations from the Sustainable Development Best Practice Principles for TWSE/GTSM Listed Companies and Reasons:

Evaluation Item
Implementation Status
Deviations and Reasons
Y
N
Description of Summary
1. Does the company establish exclusively (or concurrently) dedicated first-line managers authorized by the board to be in charge of proposing the corporate sustainable development policies and reporting to the board?
V
 The company established a Sustainability Committee in 2022 as the unit to promote sustainable development. The committee is composed of 5 directors, including 3 independent directors, to effectively drive the setting of the company’s sustainability goals. Under this committee, there are subgroups for Corporate Governance and Risk Management, Information Security and Process Management, Environmental Protection and Supply Chain, Employee Care and Social Participation. They are responsible for sustainable corporate proposals, execution of work, and reporting.The committee is convened by the chairman of the board, and each subgroup has a group leader responsible for the communication and coordination of the matters under their group’s purview, and for consolidating the provision of relevant data from their group’s purview, to facilitate the promotion of various projects and respond to major issues of each functional aspect.

The Sustainability Committee convenes once every six months in principle, and can be flexibly adjusted if necessary. In addition to the routine attendance of the committee members and the heads of each subgroup, each meeting can invite related personnel to attend the meeting based on actual needs, convened by the head of each functional subgroup.

On November 10, 2022, the execution status of the Sustainability Committee was reported to the board of directors. The content of the resolution includes:

1. The 2021 Sustainability Report has been completed.

2. The schedule for compiling the 2022 Sustainability Report.

The board of directors’ supervision and jurisdiction over sustainable development include:

1. Establishing corporate sustainability policies and overall goals, in the hope that corporate governance, customer care, environmental protection, and social welfare can all develop based on business strategy, and comply with legal regulations.

2. Reviewing the annual corporate sustainability planning and related proposals.

3. Reviewing the implementation progress and annual results of various corporate sustainability proposals.

4. Reviewing the corporate sustainability report.
None
2.Does the company assess ESG risks associated with its operations based on the principle of materiality, and establish related risk management policies or strategies?
V
  1. The disclosure period is from January 1, 2022 to December 31, 2022. The risk assessment boundary is mainly based on Quanta Technology’s Taiwan operating headquarters, covering the Xizhi Warehouse and Taoyuan Bonded Warehouse, but not including subsidiaries established for investment or financial tax purposes, and subsidiaries without operational control.
  2. The Sustainability Committee, based on the materiality principle of the Sustainability Report, communicates with internal and external stakeholders. The data is reviewed by the heads of each functional subgroup for correctness and completeness, and the executive office of the Sustainability Committee is responsible for overall planning, communication integration, and data collection. To ensure the implementation and achievement of each material issue, the Sustainability Committee holds a meeting every six months to review the progress of the corporate sustainability management proposal and compile relevant achievement data, stakeholder negotiation results, and sustainability promotion suggestions for review by the responsible supervisors. It is also required to report to the board of directors every year as required.
  3. The company has conducted risk assessments on environmental, social, or corporate governance issues related to company operations, formulated a “Risk Management Policy and Procedure Method,” and was approved by the board of directors in 2022. The Sustainability Committee also analyzes based on the principle of materiality, and integrates evaluation data from various departments to assess and establish significant sustainability development issues, and promotes the following risk management policy:
Issue Assessment Item Promotional Policies
Environment Climate Change We support the Financial Stability Board (FSB)’s Task Force on Climate-Related Financial Disclosures (TCFD) and have initiated governance operations on climate change-related risks and opportunities. We disclose annual progress and results in the sustainability report according to the suggested framework.
Social Talent Development The company has incorporated “sustainable development” into our strategic planning blueprint. To establish sustainable thinking among all employees, we completed an advocacy session on basic concepts of sustainable development for senior executives and general employees respectively in July 2022.
Corporate Governance Information Security We established an “Information Security Management Policy” to ensure that when the information operating environment is subjected to malicious attacks, damage, or improper use, necessary responses can be made quickly to reduce the potential impact and harm to our business operations. We evaluate the information security policy and report to the board of directors annually.
Intellectual Property Rights Management Program Based on the Patent Law, Trademark Law, Copyright Law, Trade Secret Law, and other related regulations, we formulated the “Intellectual Property Management Regulations” to regulate and manage the acquisition, maintenance, and application of various intellectual property rights such as patents, trademarks, copyrights, trade secrets. We report the implementation status to the board of directors once a year to ensure that the operation and effectiveness align with the company’s plan.

After the “Sustainability Committee” proposes sustainability-related plans or directions to the board of directors, the board of directors conducts regular reviews, evaluates and reviews the progress of sustainable development, and then makes adjustments and suggestions. In 2022, a total of 1 report was made to the board of directors, and the content of the resolution includes:

(1) Progress report on sustainable development and follow-up work planning;

(2) Amendment of sustainable development-related policies. This ensures that the operation and effectiveness of the Sustainability Committee meet the company’s expectations and plans, and a continuous improvement mechanism is established through the supervision of the board of directors.
None
3.  Environmental issues
(1) Does the company establish proper environmental management systems based on the characteristics of their industries?
V
(1) The Company has established a suitable environmental management system according to the characteristics of the industry.
None
(2) Does the company endeavor to utilize all resources more efficiently and use renewable materials which have a low impact on the environment?
V

(2)One of the commitments of our “Environmental Policy” is to use natural resources or energy more effectively. Facing the drastic changes in the earth’s climate on which humans depend, droughts, floods, rewriting of historical temperature records, and evolving into shortages and competition for energy and food, energy conservation and carbon reduction has become a highly regarded international issue. Our company’s energy-saving plan starts with the comprehensive implementation of daily life-saving electricity.

  1. Comprehensive implementation of office lights off during lunch break for 1 hour of energy saving.
  2. Office machinery is set to power-saving mode.
  3. For electric appliances or computer information equipment that are not used for a long time, the company colleagues are advised to turn off the host and peripheral equipment power when leaving work on the eve of holidays, to reduce the waste of standby power.

In addition, our company’s supplier sustainability management policy has incorporated EU RoHS, REACH compliance into control, by analyzing the chemical composition in materials for risk assessment to reduce the impact of these substances on human health and the environment.
None
(3) Does the company evaluate potential risks and opportunities brought by climate change, and take response measures to climate-related issues?
V
 (3) Since 2021, Alltek has been actively supporting the four core elements of governance, strategy, risk management, indicators and targets in the Task Force on Climate-Related Financial Disclosures (TCFD) recommendation book released by the Financial Stability Board (FSB) in June 2016. They have thus initiated the governance operation related to climate change risks and opportunities and disclosed this year’s work progress and results according to its recommended framework. Detailed explanations of the company’s analysis of climate change risks and opportunities have been disclosed in the “Climate Governance” chapter of our sustainability report.
None
(4)  Does the company take inventory of its greenhouse gas emissions, water consumption, and total weight of waste in the last two years, and implement policies on energy efficiency and carbon dioxide reduction, greenhouse gas reduction, water reduction, or waste management?
V
 (4)The company is committed to promoting greenhouse gas reduction, water saving and waste reduction, and has collected relevant data and implemented reduction plans for the past two years. From 2021, various future annual quantitative management goals have been set as the baseline, and the measures and results achieved each year have been explained since 2022.

1.Greenhouse gas emissions in the past two years (2020 and 2021) are as follows:
According to the definition of “Greenhouse Gas Emission Inventory Operating Guidelines” set by the Environmental Protection Agency of the Executive Yuan, the majority of the company’s main energy consumption comes from the “purchased electricity” mentioned in Scope 2 covered by the greenhouse gas inventory, accounting for more than 99% of the total emissions. The rest are mobile emission sources (gasoline of official vehicles) and fugitive emission sources (refrigerant, septic tank, fire extinguisher) defined by Scope 1. In addition, because the company does not have a production process, there are no process emission sources. From the above analysis, because Scope 1 does not have a significant impact on our company, the company’s electricity usage in the past two years has been disclosed in terms of the greenhouse gas emissions in Scope 2.

Year Use of electricity Electricity Carbon Emission Coefficient Scope 2 Greenhouse Gas Emissions
Unit: degree Unit: KG CO2e/degree Unit: tons CO2e
2020 503,856 0.502 252.94
2021 517,773 0.502 (*Note 1) 259.92

*Note 1: The [Electricity Carbon Emission Factor] is based on the standards published by the Energy Bureau of the Ministry of Economic Affairs. As the previous year’s calculation standard was published in late September, we do not know the 2021 factor before the deadline for the sustainability report. Therefore, the calculation standard for 2021 is temporarily based on 2020.

*Note 2: The scope of the greenhouse gas emission inventory includes the company’s headquarters in Taiwan, various offices in Taiwan, and logistics warehouses.
Regarding the goal of greenhouse gas emissions, Alltek plans to complete the third-party verification of the parent company’s ISO 14064-1 greenhouse gas inventory before 117. And from 2021 as the baseline year, the goal is to achieve a 1% carbon reduction each year.

2.Water usage in the past two years (2020 and 2021) is as follows:

Year Water consumption Increase/Decrease Ratio:
Unit: Cubic meters Unit: Percentage
2020 1,600 Base Year
2021 1,504 -6.00%

*Note: Except for the headquarters of the company, the rest of the offices and logistics warehouses in Taiwan are handled uniformly by the building management committee, and no additional water charges are collected from the company each month. Therefore, the scope of the water consumption and water carbon emission inventory only includes the company’s headquarters in Taiwan.
In terms of water resource management, Alltek has set a management goal of reducing water consumption or water carbon emissions by 1% each year from 2021 as the baseline year.

3.Waste generation in the past two years (2020 and 2021) is as follows:

Year Amount of waste generated Increase/decrease Increase/Decrease Ratio
Unit: tons Unit: tons Unit: Percentage
2020 48.99 Base Year Base Year
2021 48.55 -0.44 -0.89%

*Note: The survey coverage of waste generation includes our company’s headquarters in Taiwan, various offices and logistics warehouses in Taiwan.
In terms of waste management, since 2021, Quan Ke (the company’s name could vary depending on context) has been continuously reducing waste with a goal to decrease waste weight by 1% each year.
To further respond to waste reduction, Quan Ke started the “paper reduction campaign” in 2021. We promoted and implemented double-sided printing on our internal company website, set up waste paper recycling boxes to facilitate the reutilization of the reverse side of paper, and strengthened the awareness of all employees to conserve paper and reduce waste generation. Through daily self-management and environmental habits, we are strengthening the cultivation of green consciousness. The paper usage statistics of our company in the past two years at the headquarters in Taiwan, various offices and logistics warehouses in Taiwan are as follows:

Year Amount of paper used Increase/decrease Increase/Decrease Ratio
Unit: sheet Unit: sheet Unit: Percentage
2020 422,813 Base Year Base Year
2021 370,149 -52,664 -12.46%
This will be followed up and implemented.
4. Social issues
(1) Does the company formulate appropriate management policies and procedures according to relevant regulations and the International Bill of Human Rights?
V
(1) In order to fulfill corporate social responsibility and implement human rights protection, our company refers to internationally recognized human rights standards such as the “International Human Rights Code”, “Core Labor Standards of the International Labour Organization Convention”, “United Nations Global Compact” and “Responsible Business Alliance and its Code of Conduct” to formulate the following human rights implementation policies. We strive to prevent any infringements and violations of human rights, and ensure that both internal and external members of the company are treated fairly, equally, and with dignity. The policies are published on our company website. The implementation policy and related specific plans and measures are as follows:

Implementation Policy Description of relevant specific plans and measures
Providing a safe and healthy working environment to help employees maintain physical and mental health.
  1. Comprehensive Health Management System: Implementing the Occupational Safety and Health Administration’s four major plans, coupled with annual health questionnaires and employee health check-ups.
  2. Promote health promotion activities annually.
  3. Comprehensive insurance planning from inside to outside, allowing colleagues to work with peace of mind.
  4. Regularly conduct occupational safety and health prevention drills.
  5. Establishing employee assistance mechanisms and unhindered two-way communication channels with colleagues: Through various communication channels such as green windows, labor-management meetings, cross-departmental meetings, etc., to achieve unhindered communication and a friendly workplace.
  6. During the COVID-19 epidemic, a group epidemic prevention team was established, adopting phased epidemic prevention measures, providing colleagues with epidemic prevention materials and irregularly updating epidemic prevention guidelines. We also encourage colleagues to complete vaccination, offer various online exercise classes, and jointly enhance epidemic prevention capabilities, sharing hardships with our colleagues, working together to prevent epidemics, and fighting together.
Avoid all kinds of discrimination that affect job opportunities.
  1. Creating a women-friendly workplace.
  2. Support gender equality and maintain their work rights.
  3. Assistance plan for middle-aged and elderly people.
  4. Epidemic prevention care.
Prohibition of child labor and illegal labor. We do not employ minors under the age of 18 according to the law. Moreover, before new employees start working, we thoroughly review their identity qualifications to ensure that all workers have a legal status to work.
Prohibit forced labor. We implement a two-day weekend system according to law, encouraging colleagues to focus on work-life balance.
Help employees achieve work-life balance.
  1. Encourage and support the establishment of clubs and provide subsidy support.
  2. Organize employee health days, family days, public welfare activities, etc.
None
(2) Does the company have reasonable employee benefit measures (including salaries, leave, and other benefits), and do business performance or results reflect on employee salaries?
V
(2)The Company’s Articles of Incorporation stipulate that no less than 1% of the Company’s annual profit shall be set aside for employee remuneration, and that compensation shall be prudently evaluated based on employee performance and the actual status of the Company’s operations and remuneration of future risks.
None
(3) Does the company provide a healthy and safe working environment and organize training on health and safety for its employees regularly?
V
(3) The Company provides employees with a safe and healthy working environment. In addition to holding regular employee health checks, implementing various environmental hygiene measures and fire safety inspections, fire safety checks are held once a year and environmental hygiene checks are held once a quarter to implement a healthy and safe environment for employees. We regularly implement safety and health education for our employees and make safety education and training a mandatory course for recruits. Under the law, the Company also provides health consultation for employees in the company regularly.
None
(4) Does the company provide its employees with career development and training sessions?
V
(4) The company designs courses according to functional attributes and title levels to enhance employees’ professional abilities and knowledge skills.
None
(5) Do the company’s products and services comply with relevant laws and international standards in relation to customer health and safety, customer privacy, and marketing and labeling of products and services, and are relevant consumer protection and grievance procedure policies implemented?
V
(5) The Company’s products and services are handled in accordance with relevant domestic and international regulations and standards, and a special area is set up on the Company’s website to provide a channel for suppliers to ask questions, complaints or suggestions, which the Company handles appropriately and in good faith.
None
(6) Does the company implement supplier management policies, requiring suppliers to observe relevant regulations on environmental protection, occupational health and safety, or labor and human rights? If so, describe the results.
V
(6) Our company places great emphasis on “management of hazardous substances in products” and “conflict mineral management” in our supplier management policy, and constructs the PDCA (Plan, Do, Check, Act) cycle into our supplier sustainability management policy. Although we are a distributor and cannot directly control product manufacturing components and sources, we still take the initiative to pay attention and demand that the products we represent must meet the requirements of current international environmental and social issues. We further disclose relevant information in order to fulfill our responsibility in procurement. Our company’s specific requirements for supplier sustainability management policy are as follows:

PDCA Sustainability Management Policy Framework Hazardous Substance Management in Products Conflict Mineral Management
Plan Supplier Evaluation Method We comply with the latest EU RoHS Directive and REACH requirements. We conduct due diligence to assess and track the source of the smelting plant of the product’s raw materials.
Do Supplier Audit We conduct written review and analysis on identified key suppliers, and communicate and guide suppliers on areas of concern.
Check Supplier Performance Evaluation After verification, we review the objectives and results, and explore the root cause of the gap.
Act Continually Improve Management Objectives. We expand the scope of identification, and consider how to additionally initiate a regular evaluation mechanism for service-type suppliers.

1. Implementation status of management of hazardous substances in products:
Our company has concretized international environmental regulations into management policies and implemented them in the management mechanism of hazardous substances in products. We use the European Union’s “Directive on Restriction of Hazardous Substances” (abbreviated as: RoHS Directive) and “Registration, Evaluation, Authorization and Restriction of Chemicals” (abbreviated as: REACH) as the standard for our supplier sustainability management. We carefully review and analyze all written information provided by the suppliers regarding the management and identification of hazardous substances in the environment, to ensure that each transaction item complies with environmental regulations. All data is systematically compiled into a database. Through analyzing the chemical components in the materials, we evaluate which chemical substances in the supplier’s products might impact the earth’s environment and human health. If a product is assessed to be potentially harmful to the environment, we immediately guide and communicate with the supplier for improvements until they comply with the aforementioned management mechanism of hazardous substances in products.

2. Implementation of Conflict Mineral Management
Our company follows the guidelines established by the Organisation for Economic Co-operation and Development (OECD) titled “Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas.” We have established a “Due Diligence” framework using these guidelines to identify and assess supplier risks. We also utilize the Conflict Minerals Reporting Template (CMRT) released by the Responsible Minerals Initiative (RMI) as the basis for implementing due diligence. We specifically require suppliers to accurately disclose the origins of their minerals. If the minerals originate from conflict regions, they must be produced in conflict-free mines that have passed third-party verification. If conflict minerals are unintentionally used in our products, we require suppliers to disclose this information accurately during the investigation, ensuring the products we receive do not come from metals produced in conflict regions, thereby achieving our goal of responsible sourcing.
None
5. Does the Company reference internationally accepted reporting standards or guidelines, and prepare reports that disclose non-financial information of the company, such as corporate social responsibility reports? Do the reports above obtain assurance from a third-party verification unit?
V
The company has compiled sustainability reports to disclose non-financial information. However, the 2021 sustainability report published in 2022 did not receive assurance or guarantee opinions from a third-party verification entity. When the 2022 sustainability report is published in 2023, a third-party verification entity will be commissioned to provide assurance according to AA1000 AS v3 Type I, moderate assurance level, and GRI Standards 2021 version. An independent assurance statement will be attached to the 2022 sustainability report appendix.
It will be enforced in the future in line with the provisions of the Act.
6. If the company has its own corporate social responsibility policy in accordance with the Corporate Social Responsibility Best-Practice Principles for TWSE/TPEx Listed Companies, please specify its operation and the difference from its policy: None
7. Other important information to help understand utilization of corporate social responsibilities:

(1) The “Paper Reduction Campaign” was established. Depending on the workflow of each department and in compliance with legal requirements and system adjustments, we propose reducing the amount of paper printed during work while also improving work efficiency. In 2022, paper usage was 274,096 sheets, a reduction of 96,053 sheets compared to 2021, which is equivalent to reducing the cutting down of 11.53 trees.

(2) There is no packaging waste in the warehouse environment. All received boxes and filler materials are recycled.

(3) In 2022, we held the “Third Healthy E-Line – Walk Through Taiwan, Get Up and Lose Fat Competition”. All participants have traveled around the island 96.5 times, reducing carbon emissions by 19,568 kg and planting 1,080 trees, equivalent to planting 1/6 of the trees in Da’an Forest Park and going around the Earth 2.4 times.

(4) The company’s 2021 sustainability report was compiled based on the GRI standards issued by the Global Reporting Initiative (GRI), SASB standards, and the structure of the Task Force on Climate-related Financial Disclosures (TCFD). For related information, please visit our company’s website.(Read more…)
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