We recognize the importance of sustainable operation and considers its impact in every aspect of its business, including procurement targets and amounts. Although most of its production equipment and raw materials are sourced overseas, TSC is committed to collaborating with local suppliers in Taiwan to build a lean, robust, healthy, and sustainable supply chain. In 2022, our local procurement accounted for 72.7% of the total procurement amount. Moreover, TSC’s collaboration with suppliers in I-lan Site and Li-Je Site resulted in the addition of 23 new suppliers, 16 of which were local. We will continue to build stable partnerships, strengthen mutual trust, and increase the percentage of local procurement to promote the social and economic development.
TSC’s headquarters established a Supply Chain Management Department in 2022. The department integrates procurement resources from each site and optimizes the overall supply chain. The management covers aspects such as resources, demand, manufacturing, and supply. It constantly reviews and integrates planning processes, leading cross-functional teams in a collaborative mode to support the Company’s operational development goals. To ensure that supply chain scheduling considers inventory risks and meets customer demands, the Supply Chain Management Department follows the principle of “supply continuity” to ensure uninterrupted supply in unforeseen or force majeure situations. The areas of each site manage supply chain issues and collaborate with the headquarters to constantly assess potential risks and continuously optimize the resilience and strength of the supply chain.
While integrating organizational resources and strategies, TSC collaborates with customers to lower supply chain costs and improve data transparency using technological collaboration tools. This involves conducting Quarterly Business Reviews (QBR) and maintaining close relationships with key and strategic suppliers. TSC also plans the training of supply management talents, strengthening information synchronization across departments, and reducing procurement costs by implementing automation and standardized management.
With regard to supplier management, TSC established the Supplier Management Operation Procedure. Before collaborating with suppliers, the Company assesses them based on relevant assessment methods, including the supplier’s record of environmental and social impacts. TSC encourages suppliers to obtain certifications such as ISO 9001, ISO/TS 16949, ISO 14001, and ISO 14064 to jointly enhance corporate social responsibility. In addition, TSC follows the guidelines of the Responsible Business Alliance (RBA) to establish measures related to supply chain management, such as the RBA Vendor Code of Conduct, RBA Policy and Target Management Measures, Environmental and Social Responsibility Exception Handling Measures, Professional Ethics Risk Assessment Management Measures, and Social Responsibility Risk Assessment Management Measures.
The resilience of the supply chain is a matter of great concern for TSC. In addition to the basic selection criteria for suppliers, including technology, delivery, quality, cost, and other basic criteria, we conduct comprehensive assessments of economic, environmental, and social aspects to realize the concept of sustainable operation. In order to ensure that suppliers collaborate towards sustainability goals, all suppliers are required to sign the RBA Vendor Code of Conduct, providing the foundation of a solid partnership. The RBA Vendor Code of Conduct covers labor rights, anti-discrimination and anti-harassment, occupational safety, the environment, and business integrity. We hope that our suppliers and contractors will work together to ensure the implementation of the RBA Code of Conduct and promote the welfare of our stakeholders.
In addition, TSC refers to standards such as ISO 14001 Environmental Management System and ISO 45001 Occupational Health and Safety Management System, extending assessment to include environmental protection, safety and health, and management systems, as well as whether suppliers have adopted policies and conducted due diligence on the sources and supply chain of tantalum, tin, tungsten, and gold (3TG) in their products.
For more details, please refer to TSC 2022 ESG Report, Chapter 3.
