Letter from the Management Team
Commitment and Organization
CSR Commitment & Guidelines
- Create corporate value to enhance the interest and returns of investors and stakeholders.
- Maintain sound corporate governance, uphold morals and ethics, and comply with law and regulations.
- Provide a safe and healthy working environment and encourage employees to engage in social welfare activities.
- Join with our partners and customers in promoting social responsibility and creating a sustainable value chain.
- Develop green energy-saving products and follow friendly-environment practices, to reduce environmental. impact.
The Group implements CSR practices in accordance with our four main principles of " enforcing corporate governance" , " developing a sustainable environment ", "supporting social welfare" and "strengthening information disclosure ". The Chicony Group CSR Code of Conduct is set out to further regulate and improve areas such as labor, health, safety, the environment, management system and business ethics, in addition to strictly abide to the EICC Code of Conduct from Electronic Industry Citizenship Coalition, all aimed at meeting our sustainable operation goals.
Organizational Chart of Chicony CSR
The Group has set up a corporate social responsibility committee that is fully authorized by the board of directors. The CSR committee comprises of senior executives from our subsidiaries and is chaired by the top leader of the Group. It meets from time to time to promote the various issues in response to the expectations of the stakeholders, including corporate governance, customer relations and supplier management, green products, environmental protection, employee care and social welfare, etc. Starting in 2017, CSR meetings will be held every six months by the production plants and the Taipei headquarters, so as to stay on top of the major issues identified at each plant, and to implement measures for various improvements.
Organizational Chart of Chicony CSR Committee
Communication with Stakeholders
For Chicony Group’s sustainability, it is necessary to identify important issues, plan management mechanism and implementation practices and to review them at regular intervals. The following is a description of the relevant major issues and scope boundary procedure for the development of corporate social responsibility.
In order to maintain our corporate governance structure, with the Code of Conduct serving as highest guiding principle, the Group has set up a "Board of directors", a "Remuneration Committee" and a “CSR Committee”, just as the subsidiaries have done in accordance with respective needs, to provide sound governance and the best decision-making for the overall development of the Group.
Board of Directors
In accordance with the Code of Corporate Governance Practices, the Group has appointed to the Board of Directors members of various industrial undertakings experienced professionals with strong academic background, taking into account as well criteria such as gender, age, nationality and culture. The Group encourages the directors to participate in courses for further learning, the courses are mainly organized by the Taiwan Corporate Governance Association, the courses are multidimensional and include topics such as corporate governance and CSR trends, the latest development trend in international anti-tax evasion BEPS and criminal risk management. The directors are required to take at least two courses during the term and the duration to exceed at least seven hours.
Members of the Board of Directors adhere to the "Code of Integrity" to avoid conflicts of interest. In order to raise the standard of reviewing the management status and operational efficiency within the Group, the Board of Directors proposed and adopted the "Board Performance Evaluation Method" and the assessment methods in June 2015. In addition, follow-up on the implementation of corporate governance policies by the Group's divisions is done by the Audit Office, which reports directly to the Board of Directors and is responsible for risk management and the implementation of the Group's internal control system, including CSR-related performance monitoring.
In order to ensure the independence of each committee member, we believe that a sound compensation structure is a key factor to attract high-level talent and improve the overall quality of employees. The Chicony Group Remuneration Committee was established in accordance with the “Regulations Governing the Appointment and Exercise of Powers by the Remuneration Committee of a Company Whose Stock is Listed on the Stock Exchange or Traded Over the Counter”, its chief responsibilities include using annual and long-term performance evaluations of directors, supervisors and managers as well as the opinions of stakeholders such as investors, employees and customers deciding the compensation policy and standard, taking into consideration as well of the performance appraisals for individual compensation adjustments.
Chicony Group’s risk management includes constant monitoring of the eight main risk factors: external market, supply of material, talent, production R&D, customer credit and collection, foreign exchange rate, corporate finance and MIS system. In addition to the classification of the risks for management, the Group also monitors closely the external market changes and internal operation status to ensure our ability for timely responses.
Total Quality Control Management
Chicony´s total quality control means system-wide quality management to cover every step of the way, from the beginning of the project, during design and after mass production, including in depth exchange with customers to fully understand their needs, performing a variety of product testing and analysis to maximize product quality stability and making the best product possible. Quality improvement efforts are continued even once mass production begins with rigorous product quality screening based on 6-Sigma. Lean manufacturing and Value Analysis/Value Engineering (VA/VE) are also applied to reduce cost and waste during production to maximize end value for the customer. In addition to rigorously implement Total Quality Management (TQC), we have also a "Customer Quality Service Team" (CQS Team), including dedicated team to our ODM plants, all to ensure our ability to understand and provide solutions to customer problems in a timely manner.
To protect the competitiveness of customer products and safeguard customer intellectual property and patent protection are part of our customer relations management. We not only have adopted the Control Objectives for Information and Related Technology (COBIT) framework and an organizational "IT Security Management Guidelines" is in place, but also we sign non-disclosure agreements(NDA) with our assigned teams and customers and have extended the scope to cover project team members as well as suppliers. We organize personal data protection seminars as part of our training program and have formulated the "Personal Data Protection and Control Regulations" to further stable sustainable development and mutual growth with our partners.
Supplier Management and Audit
The Group's headquarters are responsible for R&D and sales development. The main production sites are located in China with the six main plants spread between Huanan, Huadong and Huazhong regions. Chicony Electronics, Chicony Power and XAVi production sites around the world generally purchase semi-fi nished components from suppliers along with small amounts of plastics, iron, tin, aluminum and silver. Other suppliers include food service, transportation, building security, office equipment maintenance, janitorial service, etc. Our Taiwan headquarters and China plants all strive to follow the principle of "local purchasing".
We encourage suppliers to self-manage with EICC Code of Conduct, and further construct a material control mechanism for Chicony Group´s "Material standard for Environmental Management", "Restricted Substances" and "Conflict Minerals" to ensure that supplier procurement not only meets international standards and customer requirements, but also produce green value chain sustainability. In order to strengthen supervision, in addition to the Industrial Safety and Health Service as the environmental supervision department, project audit teams will also be formed integrated by R&D, QC, procurement, HR, Audit Office, environmental safety and health centers and other departments to evaluate issues such as quality, delivery time, price, yield, environmental safety and health and social responsibility. Irregularities will be reported through SCAR (Supplier Corrective Action Request).
The Group has a worldwide presence with sites across Asia, Europe and the USA with currently more than 30,000 professionals spread around the world each contributing their talent and serving together as the foundation for Chicony Group’s sustainable development. We pledge to all Chicony members to strictly abide by the RBA Code of Conduct, the International Labor Convention and the Global Sullivan Principles.
Race, sex, age, religion, creed or political position are not part of the criteria for determining salary and benefits, performance appraisal and promotion or transfers to ensure equal employment rights of all Chicony employees.
Chicony Welfare employees is not only reflected in the hardware equipment upgrades and the mechanism renewal, but we have further asked the question: "how to make Chicony employees feel happy because of the Chicony Group ?" Therefore, it came the Worker Welfare Committee ("Welfare Committee”). The planning of worker welfare activities is organized as follows:
Chicony Group College of Competitiveness
The Chicony Group houses a wide range of professional specialties and develops a wide range of products. The College of Competitiveness offers multidimensional course programs created to meet the needs of different functions, departments and management positions, to provide the resources needed and to assist members of Chicony in achieving their personal goals. Detailed planning of the curriculum framework is made for both the management and general staff, for the management members, the main focus are team management, interpersonal communication, talent identification and leadership, planning and mentoring, decision-making and adaptability; for the general staff, the course is designed according to its functions, such as marketing and sales skills, persuasion and communication skills for the sales team, and workshop and seminars on planning for innovation, trend insight and technology implementation for the R&D team. In addition to the above-mentioned training system design, the College of Competitiveness also includes on-the-job training, such as job rotation, overseas stations, project internships, so every member of the Chicony Group can benefit from the guidance and feedback of the management, senior colleagues and peers, to improve and grow under the care of the Chicony family. In addition, we also provide career planning for retired employees, enabling them to attain spiritual satisfaction and prove their self-worth through making continuous contribution in their area of expertise.
Environment, Safety and Health Committee
Chicony Group created the Industrial Safety and Health Service since 2010 to oversee all workplace EHS matters and for the purpose of pursuing two-way transparency and more timely communication. Each plant in China has their own safety and health committees and EHS officers, monthly meetings are held to report on plant EHS accomplishments, also to assist the supply chain audit and to promote workplace EHS issues. During the period of disclosure by this report, the percentage of workers in the EHS committees has shown positive overall improvement compared to the previous period.
Health Management and Promotion Plan
The employee health management and promotion plan aims at safeguarding the health care of all Chicony Group members. We provide timely care of physical and mental health through medical clinics, counseling rooms and plant medical personnel, we regularly invite health care professionals to give health seminars and schedule health check-ups, provide treatment and follow-ups for employees with high health risks such as the three-hyper condition. In addition, the Group has continued requiring supervisors to view staff work hours, complete fatigue self-evaluations, and distribute fatigue consultation and prevention handbooks provided by the medical clinic, assist high-risk groups for referral and follow-up check-up and provide colleagues with physical and mental decompression activities and programs.
Chicony Group believes that in order for a corporation to be firmly placed in the society, we must first root ourselves; we project our corporate resources and love into every corner in Taiwan, starting from fulfilling our civic responsibility as a citizen.
Self-motivated concern for the disadvantaged by our staff shows how Chicony Group is surrounded from inside out by good social values such as kindness. Our object of caring is regardless of age or class, we actively show our care to disadvantaged groups whether it is physical or mental disabilities or social adjustment disorders, hoping to contribute our efforts for the greater good and bring more caring and warmth to the society.
As part of the global electronics industry, Chicony strives to take full corporate responsibility to society. We support and take part in the “Electronics Industry Citizenship Coalition” and abide by the EICC Code of Conduct, this includes the strengthening of the corporate operational system, protection of the rights of workers and their welfare, the creation of product value and profit while paying attention to environmental protection as well as social and human participation. We produce high added-value products through continuous innovation and development and also create a work environment that allows employee potential to be best developed in their own interest, as well as that of stakeholders and society.
Our commitments are：
Create corporate values, enhance stockholder and all stakeholder interests.
Maintain good corporate management, strictly abide by business ethics and comply with all legal regulations.
Provide employees with a safe and healthy work environment and encourage them to take part in public social interest activities.
Strive to promote corporate social responsibilities and pursue sustainable development with cooperating companies and clients.
Research and develop environmentally-friendly and energy-saving products, realize environmental protection actions and reduce environmental impact.
Declaration of Conflict-free Metal
Chicony Electronics herein declare the metal is Conflict-Free on products supplied to customers.
Chicony Electronics will take due diligence within our supply chain to assure “DRC Conflict-Free” for the metals of gold (Au), tantalum (Ta), tungsten (W) and tin (Sn) are not derived from or sourced from mines in conflict areas of the Democratic Republic of Congo (DRC), or illegally taxed on trade routes, either of which are controlled by non-governmental military groups, or unlawful military factions. Trade routes not confirmed to be “Conflict Free” include direct exports from the DRC, as well as exports through Rwanda, Uganda, Burundi, Tanzania and Kenya (countries of whom the U.N. Security Council note are global export routes for DRC-mined minerals).
We would like to confirm metals used in products by Chicony Electronics are “DRC Conflict-Free”.
Environmental protection is Chicony’s core responsibility and an essential mission. We are committed to the prevention of environmental pollution, the design and production of green products and we continue with improvements, strive to promote corporate environment protection culture and realize a CSR spirit of “sustainable development”. Through green design and production, we are reducing the impact our production has on the environmental from carbon emission and provide the largest value of environment protection and cherish our planet.
Chicony realizes that the usable resources of our planet are limited and precious. As a citizen of earth and a leading technological enterprise we feel duty-bound to the saving and management of these resources. We have planned a series of management actions to achieve this purpose.
Management of electricity resources
Management of electricity resources
The consumption of electricity is the main source of greenhouse gas emission and improving electricity management is a matter for continuous effort. To reduce energy-consumption over the past few years, Chicony has been enhancing the efficiency of factory facilities. In particular, measures have been taken to improve energy-saving on the production lines：
Energy-saving in air-conditioning
The actual actions were as follows：
Regional temperature control is now used to reduce the energy consumption for air-conditioning.
The cooling systems of the air-conditioners are maintained more frequently to eliminate the scale which affects energy consumption.
Operation of the pumps is more carefully regulated to increase efficiency.
Energy-saving in lighting
In accordance with all levels of the energy-saving project, starting in 2011, traditional T8 and fluorescent lamps T5 have been systematically replaced with T8 LED lamps. The energy saved has been 1,884.57 and 1,027.61 thousand kWh in 2011 and 2012 respectively. Actions taken were：
All traditional lamps were exchanged for LED lamps
LED lamps are used in all newly-built facilities
The concept of energy-saving was reinforced by promotion of the action of turning off electrical devices when they are not in use.
Energy-saving during the production process
The MKB business department has introduced new UV machines. The old machines consume 9kW electricity and the new ones only 4.8W which saves about 47% of the electricity used, a total of 16,380kWh in 2012.
The CM business department changed the mercury lights in the UV machines to LEDs and saved 7,488kWh in 2012.
We continue to repair air leaks in the factory compressed air systems. Compressed air leakage is an obvious waste of energy. Since 2010, Chicony has employed repairmen to control the leaks in all the factories and has saved 45, 89 and 88 kWh in 2010, 2011, 2012 respectively.
Other energy-saving methods
We continue to change the absorbent dryer in the air compression system in all factories from the non-heating type to the heating-type. This can save 96 thousand kWh of electricity per year. As the non-heating absorbent wastes about 15~20% of the compressed air and the heating-style uses very little energy to achieve the same effect.
All compressed air pipelines are inspected regularly for leaks and the situation is improving.
Energy-saving is being promoted in all production facilities and systems by replacing old parts with new ones that consume less energy.
Water resource management
All factories should pay attention to air-conditioning and water-cooling and ensure that regular maintenance is done. The floating ball valves that control the water level in the tanks should be serviced to reduce wasteful leakage.
Continue to replace water taps with water-saving models to ensure daily water savings.
Replace the toilets cisterns with water-saving models to reduce daily water consumption.
For factories that have water-purification systems, we introduce waste water recycling projects that ensure 85% recycling.
Promote the concept and methods of energy-saving.
Regularly inspect the water pipes in all the factory dormitories to detect and repair all leaks without delay.
The Inverter produced by Chicony can be used to produce standard city electricity to supply factories. It has been promoted by the cooperative efforts of several well known factories in the country. At present, the Taipei headquarters building has installed a 5.8kW solar energy system (polycrystalline silicon 290W x 20) that can produce 6,418 kWh of electricity per year.
New product development
The rapid deterioration of the global climate has made “green” environmental protection an issue of the gravest concern at the UN and in all countries of the world. Chicony has spared no effort to engage in environmental protection. All products by Chicony meet international environmental protection standards, such as EU RoHS and WEEE, as well as the safety rules of CE, FCC, ICES-003, VCCI, BSMI, UL, TUV. Furthermore, right from the very start when a new product is contemplated, the concept of green design is foremost in the hope that factors which might harm the environment can be avoided. Even a tiny idea, as long as it is in some way helpful to environmental protection, can make a contribution and help us fulfill corporate social responsibility.
The Chinese and English editions of the CSR reportcan be viewed and downloaded from the CSR section of Chicony and its subsidiaries' corporate websites.
Thank you so much for continually considering our commitment as well as practices on Chicony’s CSR path. If you have any suggestions or criticisms to make, please do not hesitate to contact us through the following methods. Your involvement makes an invaluable contribution to our continued efforts towards sustainable development.
CSR Team, Chicony Group
Current release : Published in Aug, 2017 (English edition)
Previous release : Published in October, 2015
Next release : To be published in July, 2019
Telephone : ( 02 ) 6626 - 6788 # 17003 E-mail : CSR@Chicony.com.tw
CSR website : http://www.chicony.com.tw/en/csr
Includes an electronic version of the report and a group version of the report for download