As a global leader in semiconductor assembly and testing services as well as a key systems and core technology integrator, ASEH primarily provides assembly, testing and material (ATM) services and electronics manufacturing services (EMS). With an aim to continuously elevate customer trust, we strengthen our service globally by providing manufacture base throughout Taiwan, China, Japan, South Korea, Malaysia,Singapore, the U.S.A. and Mexico. Our procurement is classified into raw materials, equipment, facility, engineering, waste management services,transport, logistics and subcontract services. We require all our suppliers tostrictly follow the Supplier Code of Conduct and the company’s risk assessment policies.
As part of the ASEH Procurement and SupplyChain Development Policy and Commitment, we established a four-stage sustainability supply management process that is run repeatedly to ensure supplier compliance and enhance their sustainability performance. We have also established a series of supplier programs that aim to guide, and help build up our suppliers’ ESG capabilities, so as to create a more sustainable supply chain together. We have also formulated mechanisms to closely monitor ESG performance for rewarding or disengaging with suppliers.
The ASEH Supplier Code of Conduct and Sustainability Assessment Questionnaire (SAQ) have been formulated based on the standards and guidelines of the RBA, OECD Guidelines for Multinational Enterprises, UN Guiding Principles on Business and Human Rights, UN Universal Declaration of Human Rights, ILO Declaration of Fundamental Principles and Rights at Work, ILO Fundamental Conventions and SA8000.
ASEH established a 2-phase screening process that evalsuates any underlying ESG risks at our suppliers. For suppliers that exhibit high levels of ESG risks, ASEH will closely monitor and supervise them through periodic audits and guidance to mitigate and control the risks effectively.
Phase I: Active Assessment – All suppliers
Base on type of business relation between ASEH and supplier, and the procurement value, we then assess the procurement category (eg. raw material, facility, equipment, contract services) and potential ESG risks.
Category
Assessment Methodology
Business Closeness
Conduct preliminary assessment by reviewing purchase amount and category of supplier (including material, facility, equipment supplier and service contractor).
Environment/ Social/ Governance
locations/ Country
Employ localized and high-risk regional controls at the supplier locations. Identify risks according to geopolitics, regional conflicts and high-risk country factors.
Sector-specific
Identify industry specific risks by designing different types of sustainability assessment questionnaires focusing on specific risk topics.
Commodity-specific
Screen key materials containing heavy metals or hazardous substances by material properties.
Phase II: Sustainability Self-Assessment Questionnaire (SAQ) – Tier 1 suppliers
To cater for a diverse and complex supplier base, we have customized our SAQs according to the type of industry, and ESG risk assessments for different categories of suppliers.
Supplier Category and Sustainability Assessment Aspects
Raw Material and Equipment Supplier: Labor, Health and Safety,Environmental Protection, Sustainable Governance and Risk Management, and Supply Chain Management
Facility, Equipment and Waste management suppliers: Labor, Health and safety, Environmental protection, Ethics and Sustainable management system
Service Providers:Labor, Health and safety, Ethics, and Sustainable Management System
Phase I: Desk Assessment – Tier 1 supplier
We’ve conducted sustainability assessment questionnaire to all tier-1 material suppliers. Suppliers are required to self-assess risk and provide corresponding supporting document in accordance with their responses to the question.
Phase II: Physical Assessment – Significant supplier
We define significant suppliers by high-risk supplier that identified by SAQ survey result and its business closeness with ASEH. Then we conduct physical assessment and provide counselling to ensure supplier’s risk circumstance and continually reduce risk level.
For our key raw material and critical suppliers, in our evalsuation of major raw materials and key suppliers, ESG indicators are integral factors influencing our selection in addition to quality, cost, delivery time, and technology. We drive our suppliers diligently to adopt sustainable practices through proactive management strategies. Suppliers with the best ESG performance are recognized at our annual supplier day, and invited to share their expertise in sustainability development with other suppliers at the annual supplier forum.Outstanding suppliers also receive priority in our procurement selection policy.
ASEH has implemented on- site or remote support to help suppliers develop actionable plans on completion of correction and improvements within a specified timeframe. Then, we will followup with a second audit to track the progress of corrective actions and ensure all identified deficiencies have been effectively addressed and resolved. For suppliers who continue to fall short of compliance despite counselling, we will still offer guidance in the first year and potentially reduce our procurement volume with them. To fulfill our commitment to sustainability, suppliers will be removed from our qualified supplier list if they fail to meet expectations in the second year, and all dealings with them will be suspended. In 2023, all of the audited suppliers have taken corrective actions and completed supplier improvements. No supplier was terminated for non-compliance.
ASEH believes that proactively assisting suppliers in enhancing their capabilities is critical to the prosperity of the supply chain and progress toward a sustainable future. As part of our supply chain growth strategy, we have formulated a wide range of programs that provide suppliers a variety of resources and information, such as the annual sustainability forums, sustainability enhancement programs, and ESG workshops and structured training. These programs aim to drive stronger partnerships, allowing us to respond quickly to changing environments.
In 2023, USI hosted the Annual Sustainability Forum, bringing in a total number of 500 participants from suppliers.
Communicate USI Corporation’s requirements for supplier sustainability risk management.
Promote USI Corporation’s green products, conflict minerals policy and management requirements, and explain its main focuses in the annual audits of green products and conflict minerals.
Sharing ESG Experiences by Outstanding Suppliers
Featured Topic – Net Zero and the Challenges of Scope 3 Emissions across the Supply Chain
To align with ASEH’s Net Zero Emissions pathway, we have conducted carbon inventories for the Scope 3 emissions sources (the largest emission contributors) within our supply chain. We have allocated resources to provide guidance and support to our suppliers in establishing greenhouse gas and product carbon footprint management systems that comply with regulatory requirements. Starting from 2023, we began collaborating with external consulting units to initiate a medium- to long-term supply chain carbon inventory guidance project. Through offering on-site and online guidance, we help suppliers develop greenhouse gas and product carbon footprint inventory capabilities and obtain external certification such as the ISO 14064-1:2018 and ISO 14067. This platform fosters sharing and competition among peers, encouraging suppliers to integrate carbon management into their operations, thereby amplifying ASEH’s industry influence.
In response to the challenges of climate change, SPIL has partnered with clients since 2021 to promote the "Green Energy and Low-Carbon Environment Project" which encourages the development of renewable energy within the supply chain. Through this project, SPIL collaborated with 10 suppliers to assist in the establishment of renewable energy equipment. Participating suppliers include those in materials and logistics. With the support of professional technical teams, SPIL has guided suppliers in enhancing the operational efficiency of renewable energy equipment, maximizing energy recovery. In 2023, the project achieved a total annual energy saving of 2.27 million kWh and a carbon reduction of approximately 1,338 tons.
Since 2021, ASE Kaohsiung has provided support to suppliers in reducing GHG and water resource consumption and at the same time, established a 1% reduction target which was achieved in 2022. In 2023, ASE Kaohsiung set a more ambitious target of a 3% reduction for both GHG and water resources. A total of 58 key suppliers committed to this endeavor, and worked with ASE to set reduction targets and action plans. In 2023, we successfully reduced GHG emissions by 227,655 tons of CO2e across our supply chain, equivalent to 4.3% annual reduction, and reduced water consumption by 3,297,905 tons, equivalent to 4.8% annual water saving. Both reduction outcomes exceeded our established target of 3% for 2023.
To disseminate our company’s expectations and requirements in a timely manner, and to align with global sustainability trends, ASE Kaohsiung has established an online sustainability knowledge platform. The platform enhances suppliers' awareness of sustainability by offering training resources created internally by the company’s experts on carbon reduction and water saving. This flexible learning approach, unconstrained by time and locations, utilizes digital tools to promote low-carbon lifestyles and enhance suppliers' sustainability capabilities.
To reduce energy waste and enhance sustainability awareness, ASE Kaohsiung has been assisting suppliers in reducing greenhouse gas and water resource consumption since 2021, aiming to achieve the 1% reduction target. This goal was achieved in 2022. In 2023, ASE Kaohsiung proactively set a more ambitious target of a 3% reduction for both greenhouse gas and water resources, with 58 key suppliers joining the counseling program. Through this project, they helped set reduction targets and assisted in implementing reduction plans. In 2023, the supply chain reduced greenhouse gas emissions by 227,655 tons of CO2e, achieving a 4.3% annual reduction, and reduced water consumption by 3,297,905 tons, achieving a 4.8% annual water saving. Both reduction outcomes met the set target of a 3% reduction.
As a response to the increasing digitalization of the supply chain and cybersecurity threats, we established a supplier information security evalsuation system in 2022 to ensure supply chain resilience. evalsuation of key suppliers are conducted in four steps: current status assessment, improvement support, results confirmation, and cyclical review. In 2023, we completed cybersecurity evalsuations for 76 equipment suppliers, identifying their cyber risks and weaknesses. A support team, formed by our subsidiaries, provides prioritized improvement suggestions and conducts follow-up site visits the following year to track the improvement results. This comprehensive supply chain cybersecurity management ensures the operational safety of ASEH and enhances the overall cybersecurity resilience of the supply chain.
ASE – Kaohsiung
Target: Raw material supplier, Equipment supplier
Share international trends in climate issues and future regulatory requirements
Sharing Practical Techniques for Greenhouse Gas and Product Carbon Footprint Inventory
ASE – Kaohsiung, Chungli, ASE Shanghai (Material), Wuxi, Malaysia, and Korea site
USI
Target: Raw material supplier, Facility and Waste management contractor, Recruitment agency and service contractor
Promote health and safety, food safety, and environmental health and safety policies
Disseminate knowledge on fire management, fire rescue, and emergency evacuation procedures
Conduct annual evacuation drills and emergency response exercises for vehicle accidents
