Corporate Sustainability
Business Philosophy and Vision
In 1986, Chairman Pat Chiao founded Helitek in the United States, initiating the silicon wafer business. The founding team comprised members from Silicon Valley and the domestic semiconductor industry, all with extensive experience in the field. This team laid the foundation for Wafer Works' development in silicon wafers and served as the precursor to Wafer Works. In 1997, Wafer Works was officially established in Taiwan. In 2011, the headquarters was set up in the Longtan Science Park. Over more than 20 years of dedicated effort and commitment to the steady growth of its core business, Wafer Works expanded its production bases to six plants in China. Today, the Company is one of the world's top 10 suppliers of semiconductor silicon wafer materials and one of the top three leaders in heavily doped low-resistance products. The Company boasts advanced semiconductor silicon wafer manufacturing facilities with a total plant area exceeding 120,000 square meters and nearly 2,200 employees worldwide. In 2007, Wafer Works was recognized by Forbes Asia as one of the "Best Under a Billion" companies in the Asia-Pacific region.
Wafer Works firmly believes that only by establishing trustworthy and cooperative partnerships with customers and suppliers, deeply understanding customer needs, and creating close, flexible collaboration mechanisms with suppliers, can we develop innovative products and services that exceed customer expectations. Adhering to strict operational and sales management, Wafer Works has never been heavily fined for violating laws and regulations in the provision and use of its products and services, nor involved in any legal actions related to anti-competitive behavior, antitrust, or monopolistic practices. Customer-centric and committed to our promises, Wafer Works operates with integrity to create and share a win-win-win scenario for the Company, customers, and suppliers. At the same time, we focus on our employees, recruiting and retaining top talent through our core corporate values.
We are committed to creating a safe and inclusive workplace, ensuring that every employee enjoys human rights, skill development, and a safe, friendly work environment, sharing in the Company's success.
With sustainable development as our supreme principle, Wafer Works is dedicated to becoming a customer centric semiconductor material supplier. We endeavor to implement sustainable development through six main pillars: corporate governance, employee well-being, environmental sustainability, customer service, supply chain management, and social engagement. Our continuous efforts aim to provide more services and contributions to society, striving for ongoing improvement in sustainability. Adhering to the concept of corporate sustainability, Wafer Works published its first Corporate Social Responsibility (CSR) report in 2012. In recent years, as ecological concerns have gained importance, subsequent reports have expanded to cover various aspects of sustainable development and corporate sustainability. This report continues the spirit of previous ones, offering comprehensive information on business strategies, risk management, and environmental management systems. It is fully disclosed to the public and our investment partners, demonstrating Wafer Works' commitment to social responsibility and sustainable development, and sharing the outcomes of our sustainable operations.
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Wafer Works Yangmei Fab (WWXT) | Wafer Works Longtan Fab Headquarter (WWXL) |
Wafer Works Business Philosophy
Main Products and Services
Wafer Works primarily offers semiconductor epitaxial silicon wafers, semiconductor polished silicon wafers (single-sided and double-sided polished wafers), and silicon-on-insulator (SOI) wafer products (or services). We strive to provide customers with suitable materials, applicable and legal products, and achieve better quality. We are committed to developing and researching products that enable customers to use and sell better products. During transactions, we ensure that customers receive high-quality and prompt service. All products produced by Wafer Works comply with relevant laws and regulations, maintain product quality, comply with regulatory standards, and improve product yield for better products. Below is the sales statistics for each region for the year 2023:
Global Deployment
Operational Performance
As the impact of the COVID-19 pandemic gradually subsided globally in 2023, it was followed by the emergence of inflation and high-interest rate policies, along with intense geopolitical conflicts. These factors dealt a severe blow to consumer demand in the end markets and slowed down the destocking pace in the semiconductor industry. According to statistics from the Semiconductor Equipment and Materials International (SEMI), the global semiconductor silicon wafer shipment area in 2023 was 12.478 billion square inches, a decrease of 14.3% compared to the previous year. Sales amounted to US$12.3 billion, a year-on-year decline of 10.9%. Despite facing the challenges of a downturn in the macroeconomic environment, Wafer Works continued to explore various light and heavy doped wafers for use in power semiconductor devices, focusing on niche products and expanding into key markets. Albeit with headwinds, we posted a consolidated revenue of NT$10.048 billion and a basic earnings per share of NT$1.05.
Looking ahead to 2024, after undergoing a year and a half of adjustments, the global semiconductor industry is expected to gradually return to a healthy level of inventory. Coupled with the explosive growth of AI applications and the formation of regional manufacturing centers, there are opportunities to further increase demand in the silicon wafer industry. Wafer Works will strengthen the exchange of experience and resource sharing among subsidiaries, enhance the operational synergy of the group, and actively deploy 12-inch product lines and capacity to provide global customers with differentiated product services.
Financial Information
The table below presents various financial information for Wafer Works, including disclosure of employee salaries and social investments:
During the reporting period, Wafer Works received financial subsidies from the following government units:
Board of Directors
Wafer Works adopts the candidate nomination system stipulated in Article 192-1 of the Company Act for the election of directors, with a term of three years. The independence of independent director candidates must also comply with the provisions of the "Regulations Governing Appointment of Independent Directors and Compliance Matters for Public Companies." The current board of directors consists of eight male directors and one female director, three of whom are independent directors. The average age range is mostly over 60 years old. Directors serve a three-year term, and each director has at least 30 years of work experience in business, legal, financial, accounting, or corporate affairs fields. Their expertise spans industries such as semiconductors, optoelectronics, and venture capital, demonstrating rich knowledge, personal insight, and business judgment, providing valuable advice on Wafer Works' operational strategies and development direction. To enhance directors' professional knowledge and legal literacy, at least six hours of continuing education are arranged annually (newly appointed directors receive at least 12 hours). In 2023, the total training time for directors was 89 hours, with 23 hours dedicated to sustainability-related topics, accounting for 25.8% of the total. For details of the training, please refer to Wafer Works' 2023 Annual Report The board of directors of the Company held a total of five meetings in 2023, with an average attendance rate of 95.56%.
The Company has established the "Procedures for Managing the Acquisition or Disposal of Assets," "Regulations Governing the Election of Directors," "Ethical Corporate Management Best Practice Principles," "Procedures for Ethical Management and Guidelines for Conduct," "Procedures for Handling Material Inside Information and Preventing Insider Trading," and "Rules of Procedure for Board of Directors Meetings." These documents cover various aspects including the prevention of conflicts of interest, avoiding opportunities for personal gain, confidentiality responsibilities, fair trading, protection and proper use of company assets, compliance with laws and regulations, encouragement to report any illegal or unethical behavior, and disciplinary measures. All related guidelines have been approved by the Board of Directors and are implemented accordingly. Disclosure of cross-shareholding, transactions, and outstanding balances between the highest governing body members and critical suppliers will be made in the future. For information on the highest governing body members serving on other boards, please refer to the corporate governance report in the Company's 2023 Annual Report, specifically the sections on Board Member Information (I) and Director Information (II). Directors must abstain from voting on proposals in which they have a personal interest, ensuring no cross-shareholding situations with stakeholders.
The education, experience, and attendance of the Board members are shown in the table below:
Audit Committee
To enhance corporate governance and the professional functions of the Board of Directors, Wafer Works established the Audit Committee on June 27, 2018. The committee consists of three independent directors and meets at least once every quarter. In 2023, the committee convened five times with an average attendance rate of 100%.
The primary objectives of the Audit Committee are to assist the Board in performing and supervising the following tasks:
1. Ensuring the fair presentation of the Company's financial statements.
2. Selecting, dismissing, and assessing the independence and performance of the external auditors.
3. Effectively implementing the Company's internal controls.
4. Ensuring the Company’s compliance with relevant laws and regulations.
5. Managing existing or potential risks faced by the Company.
According to the Audit Committee Charter, the committee is authorized to conduct any appropriate audits and investigations within its scope of responsibility. It maintains direct communication channels with the Company’s internal audit personnel, external auditors, and other relevant individuals. The committee is also empowered to engage legal counsel, accountants, or other professionals to assist in the execution of its duties.
Attendance of Independent Directors at the Audit Committee in 2023:
Compensation Committee
To assist the Board of Directors in evaluating the performance of management and to improve the compensation system for directors and managers, Wafer Works established the Compensation Committee on December 29, 2011. The committee is composed of a majority of independent directors and meets at least twice a year. In 2023, the committee held four meetings with an average attendance rate of 100%. The resolutions passed by the committee were submitted to the Board of Directors for discussion and subsequently approved by the board. The committee's responsibilities include formulating and regularly reviewing the policies, systems, standards, and structures for performance evaluation and compensation for directors and managers. It ensures that individual compensation is tied to company performance in compliance with relevant laws, and is linked to future operational performance and risks. Given the industry's significant economic cycles and profit volatility, and the absence of shareholders with relative control participating in compensation decisions, the directors' remuneration remains stable. Currently, no consultants are involved in setting compensation.
The Company continuously reviews the external market competitiveness of employee salaries and compensation packages, participates in salary surveys to stay informed about market salary levels, and sets salary adjustment policies. It also establishes principles for holiday bonuses, employee bonus plans, outstanding employee incentive measures, and retention bonuses for key talent, recognizing long-serving outstanding employees to attract, motivate, and retain exceptional talent.
To enhance the linkage between performance and compensation for key talent and senior executives, short-term incentive plans focus primarily on performance bonuses, with employee profit sharing as a secondary bonus. Long-term incentives and retention measures consider the Company's financial and operational performance, as well as future development, to retain talent over the long term. From 2022 to 2023, employee restricted stock awards were provided to senior executives and key talent. These rewards were tied to shareholder interests and the outcomes of Environmental, Social (People and Human Rights), and Governance (ESG) initiatives, increasing the Company's competitiveness and maximizing benefits for the Company and its shareholders. In accordance with Article 267 of the Company Act and the Financial Supervisory Commission's "Regulations Governing the Offering and Issuance of Securities by Securities Issuers," the "Regulations on the Issuance of Employee Restricted Stock Awards" for 2022 and 2023 were established to attract and retain key outstanding talent. The bonuses of directors at Wafer Works are governed by Article 29 of the Company's Articles of Incorporation. In profitable years, Wafer Works shall allocate up to 2% of its profits as director bonuses. However, in the presence of accumulated losses, an amount must be set aside in advance for offset. Article 25 thereof provides that the Chairman and directors of Wafer Works shall be remunerated by the Company for their duties. The amount of such remuneration is determined by the Board of Directors based on their level of involvement and contribution to the Company’s operations, while also considering industry standards. In order to implement the spirit of corporate governance and provide a basis for the distribution of compensation to directors at Wafer Works, the "Regulations Governing the Payment of Compensation to Directors" was established. These Regulations were proposed by the Compensation Committee during the first meeting of the fourth term on August 7, 2018, and were subsequently approved by the Board of Directors during the second meeting of the ninth term on August 7, 2018. In 2023, the highest-paid individual at Wafer Works was the President, with the ratio of his annual total compensation to the median annual compensation of other employees being 14.6:1. The ratio of the increase in annual total compensation of the President to the median of the annual total compensation of other employees was 24.4:1.
Attendance of Independent Directors of the Compensation Committee in 2023:
Risk Assessment
Wafer Works is committed to sustainable business practices, environmental and energy resources protection, and ensuring employee safety and health. Through a structured risk assessment process, we identify, evaluate, and respond to risks in economic, legal, operational, environmental, safety, health, and cybersecurity areas. We adhere to risk management procedures outlined in management systems such as ISO 9001, IATF 16949, ISO 45001, ISO 14001, ISO 27001, and ISO 50001. These procedures enable us to thoroughly assess potential emergencies, natural disasters, environmental impacts, and occupational risks, and to implement comprehensive response plans and processes. The risk assessment outcomes for 2022 were reported to the Board of Directors quarterly in 2023. Each department within Wafer Works conducts risk assessments and formulates management strategies relevant to their respective responsibilities, as detailed below:
Wafer Works Risk Management Strategy
Business Continuity Management (BCM)
In addition, Wafer Works continues to advance Business Continuity Management (BCM). Based on risk assessment results, it continuously manages business continuity, particularly focusing on high-risk situations such as fire, earthquakes, and information security risks. In 2020, faced with the severe floods and earthquakes in China, as well as the global COVID-19 pandemic, which posed potential challenges such as material shortages and production disruptions at Wafer Works due to transportation issues, the Company conducted BCM drills for critical materials and strengthened backup and control of critical material supply chains. Additionally, in response to the pandemic, an internal epidemic prevention team was established. Immediate actions were taken to ensure uninterrupted production in anticipation of potential impacts on raw material supplies both domestically and internationally. Notably, in 2023, Wafer Works maintained uninterrupted production despite the pandemic. Budget Preparation: Our management team is responsible for crafting both short- and long-term budgets, which delineate future operational policies and guidelines. We routinely scrutinize the variances between budgeted figures and actual performance.
Ethical Corporat Management
"Honesty and Innovation" serves as the foundation of our operational ethos, dedicated to advancing corporate governance with elevated ethical standards, and upholding the principles of fairness, honesty, trustworthiness, and transparency in all business endeavors.
To embody the spirit of ethical management, Wafer Works has established the "Ethical Corporate Management Best Practice Principles," "Procedures for Ethical Management and Guidelines for Conduct," and "Procedures for Handling Material Inside Information and Preventing Insider Trading," which have been approved by the Board of Directors. These guidelines regulate the behavior of board members and company employees. Furthermore, in alignment with the principles advocated by the Responsible Business Alliance (RBA), Wafer Works has implemented the "Code of Ethical Business Conduct" to promote ethical behavior among all employees. This initiative seeks to standardize behavior during business operations, emphasizing the importance of professional competence and ethical judgment in protecting the Company's assets, interests, and reputation.
To ensure that daily operations meet high ethical standards, Wafer Works has established basic conduct guidelines for directors, managers, general employees, and business partners while performing their duties, including the "Code of Ethical Business Conduct" and "RBA Code of Conduct Identification and Management Guidelines." Commitment to these standards includes:
(1) Ethical principles; (2) Respect for individuals and customers; (3) Avoidance of conflicts of interest; (4) Gifts and business hospitality; (5) Facilitation payment; (6) Provision of complete, proper, accurate, timely, and understandable information disclosure; (7) Reporting, protection, and immunity; and (8) Corporate social responsibility. We advocate for a culture of integrity and, in the face of various challenges in industry competition, are obligated to collectively uphold the Company's reputation to earn the respect and trust of customers, suppliers, and the industry, ensuring the sustainable operation and development of Wafer Works. In 2024, a "Wafer Works Supplier Code of Conduct Compliance Statement" was issued to critical and important suppliers, with a signing and returning rate of 99%.
Wafer Works adheres to the principles of integrity and pragmatism, complying with government laws and regulations, and is committed to abiding by government social and economic policies, fulfilling its corporate social responsibility. During the reporting period, Wafer Works did not incur any fines for violations of environmental, social, or product (or service) regulations, nor did it face any antitrust or anti-monopolistic lawsuits.
Wafer Works regularly conducts educational training and awareness programs to ensure that employees fully understand the Company's commitment to ethical operations, policies, preventive measures, and the consequences of unethical behavior. We uphold a positive pursuit and quality assurance, aspiring to innovate for the future and sustain operations based on these principles.
At Wafer Works, we respect the diversity of employee backgrounds and abilities, striving for balanced development in employees' work and life quality. In human resources management, we balance institutionalization with humanization, treating all employees fairly and justly. We establish mutual trust and open communication channels, providing a work environment free from any discrimination or unequal treatment, enabling employees to contribute their best and become important long-term partners. Wafer Works provides a complaint process (as shown in the diagram below) for handling relevant issues, and there were no incidents of discrimination this year.
Anti-corruption System
Wafer Works observes the Ethical Corporate Management Best Practice Principles and the RBA Code of Ethical Business Conduct. According to the "RBA Risk Assessment Management Guidelines," we carry out anti-corruption risk assessments for directors, supervisors, managers, and employees. In line with the "Code of Ethical Business Conduct," we regularly conduct training and awareness programs. In 2024, we offered courses on RBA and ethical management (including anti-corruption and antiinsider trading), achieving a 100% participation rate from board members and employees, totaling 1,064 employee attendees. These sessions ensure that governance units and all employees fully understand Wafer Works' commitment to ethical management, its policies, preventive measures, and the consequences of unethical behavior. "Honesty and Innovation" is the cornerstone of Wafer Works' operating philosophy. All 99 senior managers and board members, at grade 9 and above, signed an anti-corruption pledge, demonstrating the Company's strong stance against corruption. In 2024, we completed corruption risk assessments for our Longtan and Yangmei facilities, identifying no corruption risks. Overall, no incidents of corruption or complaints of suspected corruption were reported in 2024.
Regarding business ethics risk assessment, Wafer Works prioritizes a reasonable division of labor and an authorization system to enhance efficiency and mitigate risks, including corruption. The Company has implemented the "RBA Risk Assessment Management Guidelines" to evaluate risks related to ethical management. Upon identifying any risks, relevant units must promptly review their procedures and propose improvement measures to eliminate these risks.Regarding whistleblowing and complaint channels, to provide employees with avenues to express concerns and report illegal activities, Wafer Works has established a physical employee suggestion box. Additionally, the "RBA Handbook" clearly outlines the reporting channels. Employees who observe illegal behavior must report it via email or in writing to the Chairman, President, Audit Supervisor, or other appropriate personnel.The designated whistleblower email is
Adhering to the principles of ethical management and honesty and innovation, Wafer Works integrates integrity and customer orientation into its core competencies for employees and includes these values in performance evaluations. Annual employee assessments are conducted to ensure that organizational culture and employee behavior align with the Company's sustainable development principles. Through long-term strategic planning, Wafer Works aims to achieve sustainable development performance.
To instill correct legal concepts and behavioral standards across the Company and reduce corporate governance risks, Wafer Works offers training and advocacy programs on professional ethics, insider trading, commercial bribery, and anti-corruption in alignment with the core competencies of honesty and innovation. Each employee is required to sign declarations on information security and trade secrets. These measures ensure that employees adhere to ethical principles, behaviors, and standards in their work and possess the correct legal concepts, thus reinforcing the Company’s competitiveness and commitment to sustainable development.
Information Security Policy
To ensure the confidentiality, integrity, and availability of corporate information, Wafer Works has established information security policies in accordance with company operational requirements and relevant legal regulations. These policies serve as guiding principles for information security management and are implemented through the operation of internal cyber security organizations. Additionally, employees should be made aware of cyber security risks and the security objectives of information collection, processing, transmission, storage, and circulation should be achieved through management procedures and security protection technology.
Information Security Organization, Members and Supervision
The Company has established an Information Security Committee tasked with formulating and reviewing information security policies, resource allocation, and reviewing the implementation of various measures. Senior management executives serve as management representatives, responsible for coordinating and promoting information security management matters. Regular cyber security meetings are held, and reports are submitted to the board of directors.
The Company's Information Security Management Plan
Wafer Works is comprehensively enhancing its cyber security management. The cyber security resource investment for 2023 includes the following projects: