Responsible Procurement

A Promoter of Shared Value

Suppliers have always been Nanya's most important business partners. We aim to enhance cooperation to create greater value and share the value and benefits of cooperation and create a sustainable future.

Statistics

  • 100 %

    Completed three-year sustainability audit of key suppliers

  • 5 years in a row

    Completion rate of deficiency improvements in supplier sustainability audit reached 100%

  • 35 suppliers

    Number of suppliers that supported the Sustainable Development Mutual Benefit Initiative in 2022 (organized for the first time)

Strategy and Performance

2022 Performance

Sustainable Supply Chain Management

  • 100% Use of non-conflict minerals (Goal : 100%)
  • 100% Critical suppliers' completion of the self-evaluation questionnaire (Goal : 100%)
  • 100% Completion rate of deficiency improvements by suppliers with high sustainability risk in audits
  • 100% of suppliers signing the Supplier Code of Conduct
  • 100% Completion of audits and guidance for Key Suppliers (once every 3 years)New (Goal:100%)
  • Conducted 2 or more Supplier sustainability counseling casesNew (Goal : 2 cases)

2023 Goals

Sustainable Supply Chain Management

  • 100% Use of non-conflict minerals
  • 100% Critical suppliers' completion of the self-evaluation questionnaire
  • 100% Completion rate of deficiency improvements by suppliers with high sustainability risk in audits
  • 100% of suppliers signing the Supplier Code of Conduct Sustainable
  • 100% Completion of audits and guidance for Key Suppliers (once every 3 years)
  • Conducted 2 cases of Supplier sustainability counseling cases

Strategy

Sustainable Supply Chain Management

  • Management of responsible minerals sourcing and conflict-free minerals : No conflict minerals have been used in any of Nanya's products
  • Supply chain risk management: Implement regular "quality, delivery, service, cost, technology, and sustainable management" evaluations for suppliers

Sustainable Supply Chain Management

Nanya firmly believes that the sustainable growth of supply chains has certain impacts on corporate sustainable development. Therefore, we are committed to developing sustainable supply chains. We actively invest in related resources and cooperate with suppliers to drive sustainable supply chains and achieve shared value.

  • Sustainable supply chain risk management

    Implement risk assessment through self-evaluation questionnaires for suppliers, and strengthen supplier risk management through audits and improvement tracking

  • Supply chain cooperation and exchanges

    Periodically organize supplier conferences and supplier evaluations on the basis of cooperation and mutual aid, and provide guidance for suppliers to increase social, economic, and environmental benefits, in order to achieve sustainable development of the overall supply chain

  • Improve the sustainability of supply chains

    Nanya pays attention to environmental and social sustainability issues while pursuing economic benefits, and continues to work with suppliers in projects related to sustainability

  • Non-use of conflict minerals

    Nanya is committed to a responsible procurement management strategy for the ban on conflict minerals to satisfy current and future market, legal, and regulatory expectations

Sustainable Supply Chain Management Framework

Nanya Technology Corporation' s emphasis on sustainable development is not limited to only the Company, but was further expanded to suppliers, particularly the ESG-related sustainable development needs of suppliers. We established a five-stage sustainable supply chain management process, and use sustainability regulations, active risk assessment and surveys, sustainability risk surveys, sustainability audits/improvement measures, and supplier capability development to manage and control supply chain risks and strengthen suppliers' sustainability performance. We hope to drive suppliers to grow with us and generate more shared value and influence through a series of sustainability management processes. In addition, the sustainable development of Nanya Technology Once a year, the committee regularly reports the effectiveness of supply chain management to the board of directors, so that senior executives can understand immediately.

Internal Personnel Training

We organize education and training courses on sustainability-related issues every year to help internal personnel better understand sustainable development and implement the sustainable development policy. A total of 7 courses were offered in 2022; the total length of the courses was 5 hours and there were 21,585 participants.

Supply Chain Management Strategy

When Nanya is selecting suppliers that directly produce materials, the suppliers must go through rigorous evaluations and reviews in addition to third-party verifications, including ISO 9001 and ISO 14001. We use a digital supplier assessment and management system to conduct assessment of the Company's six supplier management strategies: "quality, delivery, services, costs, technology, and sustainable operations". The score for sustainable management indicators (sustainable operations) accounts for 10% to ensure compliance with the Company's requirements for sustainable supply chain development.

  • Note 1: The five most important supplier management strategies are: "quality, delivery, service, technology, and sustainable development"
  • Note 2: Sustainable operations
    - Green environment evaluation items include the ISO 14001 certification, energy and resource conservation, reduction in greenhouse gas emissions, and waste recycling rate.
    - Corporate social responsibility evaluation items include compliance with local labor laws and regulations.
  • Quality

    Stable yield
    Decrease in variates

  • Delivery

    On-time delivery
    Multiple backup sources

  • Services

    Quick response
    Pro-activeness

  • Costs

    Reduction in waste
    Increase in benefits

  • Technology

    Front-end development
    Risk forecasts

  • Sustainable operations

    Green environment
    Social responsibility

Sustainable supply chain risk management

Sustainable Supply Chain Management

Nanya established a supply chain management framework. We use sustainability regulations, sustainability risk surveys, on-site sustainability audits/improvement measures, and supplier capability development to manage and control supply chain risks and strengthen suppliers' sustainability performance. We hope to drive suppliers to grow with us and exert more shared value and influence through a series of sustainability management processes.

  • Sustainability regulations

    Sustainability regulations

    • Supplier Code of Conduct
    • Responsible Business Alliance (RBA) Code of Conduct
    • Regulations and requirements related to responsible minerals sourcing and conflict-free minerals
  • Active risk assessment and surveys

    Active risk assessment and surveys

    • Examine and survey the region, procurement, and products supplied by all suppliers, and carry out a preliminary assessment and analysis of potential risks
  • Sustainability risk assessment questionnaire

    Sustainability risk assessment questionnaire

    • Distribute self-assessment questionnaires to all tier 1 suppliers
    • Identify suppliers with high ESG risk
  • On-site sustainability audits/improvement measures

    On-site sustainability audits/improvement measures

    • On-site audit
    • Document review
    • Employee interviews
    • Issue CAR for discrepancies found in audits
    • Follow up on improvement for defects
  • Develop supplier capability

    Develop supplier capability

    • Convene supply chain seminars
    • Jointly implement ESG projects with suppliers
    • Organize supplier award ceremonies

Signing the Supplier Code of Conduct

Nanya Technology Corporation established the Supplier Code of Conduct for suppliers to understand and gradually implement corporate sustainability. The Company provides suppliers with comprehensive training. The scope of the Supplier Code of Conduct includes laborers, health and safety, environment, code of ethics, management system, and biodiversity. Suppliers are required to sign the Supplier Code of Conduct every year and training completion rate was 100%.Supplier Code of Conduct Coverage :

  • Labor : Freely Chosen Employment, Working Hours, Wages and Benefits, Humane Treatment, Non-Discrimination
  • Health and Safety : Occupational Safety, Emergency Preparedness, Occupational Injury and Illness ,Industrial Hygiene, Sanitation, Food, and Housing
  • Environmental : Pollution Prevention and Resource Reduction, Hazardous Substances, Air Emissions ,Water Management ,Energy Consumption and Greenhouse Gas Emissions
  • Ethics : Business Integrity, No Improper Advantage, Disclosure of Information , Intellectual Property, Responsible Sourcing of Minerals, Privacy
  • Management System : Company Commitment, Management Accountability and Responsibility, Legal and Customer Requirements, Risk Assessment and Risk Management, Worker Feedback , Participation and Grievance
  • Ecological resources commitments : biodiversity, deforestation, and reservation
  • Note: Suppliers that have signed include tier 1 suppliers and non-tier 1 significant suppliers

Risk assessment process

  • Step 1 of risk assessment Active risk assessment
    • Nanya Technology Corporation examines and surveys the region, procurement, and products supplied by all suppliers, and carries out a preliminary assessment and analysis of potential risks to monitor suppliers' sustainability risks, in order to better understand suppliers' sustainable development situation.
    Risk factors for initial assessment
    • Supplier's area: assess whether there are conflict minerals in the area, natural disaster risks, human rights risk factors, etc.
    • Product category supplied: Evaluate the materials used in the production of products Whether the material contains harmful substances (such as: RoHS/PFOS/PFAS...) , whether there are alternative materials, etc.
    • Operation of supply: Assess whether the supplier has operational risks, whether there is an emergency response plan
  • Step 2 of risk assessment Sustainability risk assessment questionnaire
    • Nanya Technology Corporation distributes sustainability risk assessment questionnaires to all tier 1 suppliers, and the questionnaires are collected after suppliers use the questionnaire for self-assessment, in order to ensure their implementation of sustainability issues. Suppliers are required to reply the implementation status of various sustainability issues on the questionnaire and provide certification documents issued by related management systems. The results of the suppliers' self-assessment questionnaire shall be adopted as the basis of sustainability risk management and as reference for Nanya Technology Corporation's assistance to achieve supplier sustainability. The content of questionnaire mainly focuses on potential impacts that suppliers might make on the three aspects of economic, social, and environmental. (For example, Potential impacts on the social aspect include labor practices/human rights standards/business ethics/health and safety. Potential impacts on the environmental aspect include environmental management/greenhouse gas. We analyze the results of the suppliers' self-assessment questionnaires, screen 5% of high-risk suppliers for onsite audits, and provide assistance for improvements.

In 2022, all tier 1 suppliers (including significant suppliers) completed sustainability risk assessment. (The Company distributed the self-assessment questionnaires to 282 suppliers and all of them handed the questionnaires back.) After analysis of the questionnaires, a total of 16 high-risk major suppliers were identified in 2022. High risks in three aspects were as follows. With regard to high-risk suppliers, we performed document review and audits.

  • Economic aspect
    • Failed to establish a responsible mineral sourcing and conflict-free minerals policy
  • Social aspect
    • Failed to establish regulations prohibiting discrimination
    • Failed to prohibit the use of child labor and provide remedies in case of unintentional use
    • Failed to explicitly state that anonymous reports are acceptable
    • Do not have any mechanisms for handling anonymous complaints and feedback
    • Failed to establish complete personal data protection regulations and letter of consent for use of personal data
  • Environment aspect
    • Failed to implement identification of safety and health regulations
    • Failed to implement identification of environmental protection regulations

Results of the 2022 Supplier Sustainability Risk Survey

Sustainability Audit

We analyze the results of supplier sustainability risk questionnaires, find high risk suppliers, conduct further audits and provide guidance for different attributes of suppliers, and issue a CAR for deficiencies found in the audit. Suppliers are required to propose improvement plans and complete improvement measures within two years, how the supplier should be handled will be discussed by the Material Review Board(MRB),such as : reduction, transfer purchase orders, or cease cooperation, in order to ensure that risks are effectively controlled and reduced.

The audit coverage rate of high-risk suppliers was 100% in 2022. We audited 20 high-risk suppliers (including 16 high-risk tier 1 suppliers and 4 high-risk nontier 1 significant suppliers ) on their sustainability performance. The audit results showed that high-risk suppliers had 74 non-compliance items, but high-risk non-tier 1 suppliers had zero. In regard to non-compliance items, the Company issued a Corrective Action Request (CAR) for follow-up and improvement.

Sustainability audit table of high-risk suppliers

2019~2022 Sustainability audit table