Sustainability Partnerships

 

 

Product Safety

In order to implement social responsibility, Wafer Works complies with the RBA Code of Conduct, and conducts RBA-VAP verification through a third party. The Company also has been certified with ISO 9001: 2015, IATF 16949: 2016, ISO 14001: 2015, ISO 14064-1: 2006, ISO 45001: 2018, ISO 50001: 2018 and BS 8001: 2017. The risks encountered at all levels in the business process are identified and countermeasures are formulated to make the Company's operation more stable and smoother.

 

Wafer Works has been certified with ISO 9001 and IATF 16949, and continues to measure, analyze, and review each process, and make effective improvements to achieve stable quality through the QMS operation. The products provided by Wafer Works to customers have no significant impact on health and safety, and also meeting the needs of stakeholders such as customers, etc. In 2022, a total of 19 suppliers were required to submit RoHS reports and Restriction of Hazardous Substances Undertaking, and all of them had submitted those documents, which recorded a submission rate of 100%.

 

 

The products of Wafer Works comply with the laws and regulations and are marked in detail on the packaging (origin, ingredients, warnings, etc.). In accordance with the QMS requirements of ISO/IATF 16949, the concept of process is used to monitor three aspects performance which are product, process, and system, and to encourage internal continuous improvement in order to improve product quality and production efficiency. All products (or services) produced or provided by Wafer Works comply with relevant laws and regulations. During the reporting period, there was no violation of relevant laws and regulations on information and labeling of products and services, and no violation of production and marketing communication (including advertising, promotion, and event sponsorship), hence there was no serious penalties or major fines being imposed.

 

 

 

 

Intellectual Property Rights

In order to strengthen the leading position of Wafer Works in the industry, and ensure that the advanced R&D results have legal protection in the market, prevent infringement disputes, reduce the Company's operational risks, and enhance the Company's competitiveness, Wafer Works attaches great importance to intellectual property rights, complements with technology R&D projects to carry out patent layout, and prepares internal patent application proposals through the Company's patent application system and regulations governing patent application management, and cooperates with patent law firms to assist in patent search, application, and review related work to improve the probability of patent approval, and reduce the infringement risk of product layout in the future.

 

Wafer Works has formulated a "Regulations for Rewarding R&D, Innovation and Creation" to foster innovation of employees. The Company increases the intellectual property output by integrating the Company's development strategy to ensure the uniqueness of the Company's products and technologies and regularly conducts patent inventory to review the value of each patent, and controls the progress, validity period and certificate filing of each patent application. More than 50 patent applications have been filed over the past three years, and the number of patent applications in 2022 has also achieved the target. Wafer Works will adjust the patent map for the next year to gain a better understanding of our competitors.

Customer Satisfaction

Wafer Works upholds the principle of customer-oriented to address current and future customer needs and continue to provide quality products to enhance customer satisfaction. In 2022, Wafer Works conducted a satisfaction survey for the top 30 customers, and the survey result had scored 83.2%, which is higher than the annual target of more than 80%. The Company will continue to manage customer issues in the future.

 

 

 

Customer Privacy

"Establishment with Honesty" is one of the business philosophy of Wafer Works. A non-disclosure agreement (NDA) will be signed prior to establishing a commercial relation with customers to ensure that the information of both parties will not be leaked. Internal employees are also required to sign NDA and attend regular educational training and advocacy courses to ensure that all personnel are aware of the importance of data protection and confidentiality. At the same time, the save function of the computers used by employees has been disabled to strengthen the data protection of Wafer Works, and the education and training will be conducted by the Department of Legal Affairs. Moreover, firewall, encrypting file system, electronic personal information storage platform has also been deployed to control and verify the access rights and records of relevant personnel to implement customer data security protection.

 

Wafer Works has also formulated "Regulations Governing Code of Ethics and Business Conduct" to protect the personal data and privacy for those who deal with Wafer Works (including suppliers, customers, consumers, and employees), and complies with the data protection and privacy laws for collection, storage, processing, dissemination and sharing of personal data. In 2022, Wafer Works did not receive any complaints related to violation of customer privacy or customer data loss.

 

For personnel management, Wafer Works also strengthens employees' awareness of information security. All new employees are required to receive education and training and sign the "Employee Code of Ethics and Business Conduct Declaration". The Company also enhances advocacy to educate existing employees about the importance of information security. At the same time, the data is also processed according to the data access tiers to ensure that the data is processed safely, and the CRM/ERP system are improved to provide the highest level of protection for customer confidential information. In addition, Wafer Works has a comprehensive ISMS. The Company continues to strengthen the system and information security, including the establishment of complete gateway management and control equipment, anti-virus system, network access control system, system vulnerability management, file encryption system, and has set Company standards to avoid data leakage.

 

Wafer Works has established a long-term cooperative relationship with suppliers to ensure the stability of the supply chain, and signed contracts to obtain a better and stable source of raw materials, thereby enhancing the Company's competitiveness. In addition, the Company has established an integrated system to select suitable domestic suppliers through supplier evaluation, and factors such as "price", "quality", and "delivery" are considered, the sustainability of suppliers such as compliance with laws and regulations, participation in environmental protection, etc. are evaluated in order to strengthen supply chain management, and also making effort for sustainable development.

 

 

Supply Chain Interaction

Wafer Works actively invests manpower and resources in the investigation and confirmation of raw material suppliers. To grow together with suppliers, Wafer Works has developed a complete supply chain management practices and management measures that include supplier management, supplier evaluation, supplier audits and green material requirements, etc., to guide suppliers to meet green supply chain requirements and reduce supply chain risk. As the control of internal hazardous material information, we incorporate environmental protection principle into the supplier management mechanism. In 2018, with reference to RoHS regulations and customer requirements and other requirements of prohibited substances, Wafer Works required all critical and important material suppliers to use raw materials and packaging materials that comply with environmental protection standards and do not use metal materials originated from relevant countries according to the Conflict Minerals Regulation. Together with our suppliers and partners, we jointly seek and develop a better and more environmental-friendly green products and contribute to local social and economic development through procurement. Wafer Works regularly evaluates the compliance level of each supplier in accordance with the requirements of the qualified supplier evaluation standards to ensure all critical and important material suppliers meet our requirements. Supplier will be required to improve the non-compliant item, if any.

 

The upstream and downstream supply chain of Wafer Works are illustrated as follows：

 

 

Supply Chain Organization Structure

The suppliers of Wafer Works mainly include raw materials suppliers, equipment engineering suppliers, waste management companies, on-site vendors (such as security, janitors), and land, sea and air transportation contractors, which most of them are our long-term partners. Unless it is necessary to seek new suppliers or procurement ratio adjustment due to significant changes in demand or supply, we maintain good procurement relationship with our suppliers.

 

The introduction of the structure and management policies of raw material
suppliers are as follows：

 

 

At present, Taiwan is the main sourcing area for raw materials for Wafer Works. In order to promote sound business practice, we cooperate with various sourcing partners to actively implement ESG practices in procurement as well as green procurement and promote the implementation of materials localization to support the development of local suppliers, which not only can reduce unnecessary air and sea freight costs, but also reduce the carbon footprint generated during the shipping of materials. Also, we put environmental protection into practice. In addition to recycling and reusing of pallets and PP cushioning materials by warehouse staff, we also transform recycled materials into raw material packaging corner protectors and reuse shipping boxes to reduce costs and waste of resources.

 

 

Wafer Works regarded suppliers as important partners in creating value together, and collaborating with brand customers, hoping to fully influence the supply chain to fulfill business ethics and social responsibilities, thereby reducing the consumption and impact of environmental resources, and improving the ability to create value for the economy, society, and environment as a whole, and creating a flourishing industry with sustainable growth. The following companies are the suppliers of Wafer Works, and the proportion of each procurement:

 

 

 

Supplier Management

Wafer Works has formulated standard procedures for supplier selection and evaluation as well as sample validation to evaluate a new supplier to ensure that the selected suppliers and materials meet the requirements. Upstream suppliers are required to comply with the RoHS standards, national provisions pursuant to the industrial safety qualifications for manufacturers, ISO qualifications, and requirements of labeling and pictograms of hazardous substances on the goods, etc. Manufacturers need to properly recycle the used container or loading device and attach no-radioactive contamination certificate to the consignment, etc. We stated our standpoint of upholding the spirit of sustainable management and required suppliers to strictly comply with the regulations as well as principle of fair trade in the "Request for Quotation" and "Purchase Order". We dedicate ourselves to requiring our suppliers to meet the requirements of environmental protection, industrial safety, and human rights. Non-compliant supplier will be rejected and listed for supplier evaluation and other punishments

 

Besides, in response to the global human rights issue that has gained increased attention in recent years, suppliers are required to conduct detailed investigations on compliance with "conflict-free metals" for the procurement of materials, parts or products contain metallic components to ensure that all purchased raw materials are from legal sources. Also, we ensure that the work environment is safe, employees' rights and interests are protected and respected, pollution prevention for manufacturing processes and products are implemented, and social responsibilities are fulfilled.

 

As for the waste management companies, we will conduct on-site audit every year for all waste management companies to ensure that the waste disposal by vendors is conducted in accordance with the law and all the wastes are properly handled.

 

 

Vision of Supplier Management

The vision of supplier management of Wafer Works is to strengthen the product quality, supplier management effectiveness and cost-quality balance through the cooperation with suppliers, thereby improving customer service efficiency and customer satisfaction to achieve a win-win situation by establishing partnerships with customers and suppliers in supply chain.

 

The management of suppliers is based on the logic of good outcompetes bad. Upon supplier appointment, the contents of the documents provided by the supplier, incoming material quality, delivery schedule control, etc., will be recorded by Engineering, Purchasing and Quality Assurance Departments as the references for annual evaluation. And the evaluation will be conducted based on the supplier audit plan of plant. If any abnormality is found, the supplier will be required to improve the abnormality and make constant improvement.

 

 

 

Supplier Evaluation and Audit

According to the "Qualified Supplier Evaluation and Assessment Guide", Wafer Works will assess the quality, delivery, price, and degree of cooperation of suppliers every half year, and arrange supplier audit every year to ensure the performance of suppliers meets the requirements. There were 120 critical and important materials suppliers participated in the 2022 annual supplier evaluation.

Evaluation results showed that 94% of suppliers achieved a rating of B grade or above, meeting expectations. Suppliers who did not meet the target were required to engage in continuous improvement activities and their progress was monitored. They were also included in the audit plan for the following year. In 2021, two suppliers were identified for improvement and their progress was verified and confirmed in 2022, meeting the target. In H1 2022, two suppliers did not meet the B-grade rating, mainly due to quality issues. They were requested to provide improvement plans and their assessment reports were reviewed by the QA Division in October 2022. In H2 2022, five suppliers did not meet the B-grade rating, also primarily due to quality issues. Their improvement progress is being continuously monitored, and the tracking results will be disclosed in the 2023 Sustainability Report.

 

 

 

Green Materials

In order to implement sustainable development and fulfill social responsibilities, Wafer Works has established a green material management system. According to the "Regulations Governing Green Product Related Substances", requirements of RoHS, REACH/SVHC as well as customer requirements, suppliers are required to provide third-party test reports, letter of undertaking or letter of guarantee every year to ensure that the relevant material complies with the requirements of EU RoHS Directive, RoHS 2.0 and REACH SVHC list, heavy metals and other chemicals that are harmful to humans or the environment. The test results should be N.D. (Not detected) to ensure that the products of Wafer Works are nontoxic and non-hazardous to humans and the environment.

 

Wafer Works continues to promote green procurement and suppliers of raw materials and packaging materials are required to provide letter of guarantee to ensure that the products do not contain substances that are harmful to the environment, test report to ensure the products meet the customer requirements and the relevant laws and regulations, as well as letter of undertaking to ensure that the products do not use materials originated from conflict areas. Wafer Works has formulated the "Regulations Governing Green Product Related Substances", which its management is divided into supplier management, raw material, packaging material inspection, product verification, internal audit and customer investigation, etc. The content of the non-hazardous substance regulations or directives (e.g., RoHS, Sony SS-0259, etc.) of concern to customers will be announced to the employees through the knowledge management system (KM).

 

Wafer Works also identifies product compliance in accordance with the regulations or directives to ensure that all concerned substances are regulated and comply with RoHS, RoHS 2.0, REACH/SVHC and customer requirements, with a view to achieving green product standards and reducing the environmental impact of products.

 

 

 

Green Procurement

The use of products with eco-labels can reduce the resource consumption, as well as the pollution to the environment and the impact on the earth. Fulfilling our responsibilities of a global citizen, Wafer Works actively promotes green procurement to fulfill the responsibility of corporate citizenship, preserves global environment and implements green product policies. Material suppliers are required to submit inspection reports by batch or on a regular basis to prove that the products comply with relevant international environmental law and customer requirements related to prohibited and restricted substances to achieve the concept and commitment of green supply chain management.

 

 

Conflict Minerals

Wafer Works has incorporated the "Conflict Minerals" into the supplier management policies. As a global citizen, we declare and promise not to accept the use of metals originated from conflict areas. At the same time, we also required our suppliers to undertake that not to use metallic materials originated from conflict areas in their products in order to prevent such practice through market mechanism.

 

 

Human Rights Related Issues

In order to become a qualified supplier of Wafer Works, we have incorporated human rights clauses into the procurement contract, in which suppliers are required to sign the "Supplier Evaluation Form" and "Wafer Works Supplier Code of Conduct", and complete the self-evaluation questionnaire. Suppliers need to undertake that no forced labor (including bonded labor, involuntary prison labor, slavery, etc.) is used. Suppliers shall not allow discrimination in both external and internal recruitment (e.g. promotions, rewards, etc.) because of race, color, age, gender, sexual orientation, disability, pregnancy, creed, political belief, association and marital status, and shall not violate the regulatory requirements for child labor and the CSR requirements. In addition, relevant corrective actions will be taken if it is found that relevant operations and suppliers at risk for human rights related issues.