Sustainability
Sustainability
Responsible Procurement
Local Procurement
TSC recognizes the importance of sustainable operation and considers its impact in every aspect of our business, including procurement targets and amounts. Although most of our production equipment and raw materials are sourced overseas, TSC’s operating sites are committed to collaborating with local suppliers to build a lean, robust, healthy, and sustainable supply chain. In 2023, local procurement accounted for 64.66% of the total amount of procurement at TSC, reaching over 60% for three years in a row. In the future, we will continue to build stable partnerships and bolster mutual trust, in hopes of increasing the percentage of local procurement, thereby facilitating social and economic development.
Supply Chain Management Measures and Strategies
Sustainable supply is a critical component of TSC’s commitment to sustainable supply chain management. In recent years, geopolitical factors, including wars, trade wars, and pandemics, have transformed the presence of companies worldwide in the industrial supply chain. Against the backdrop of external turbulence, TSC deeply acknowledges the need to bolster supply chain resilience through various means, such as supplier diversification, BCM, and monitoring of inventory levels, so as to cope with potential risks and crises. In 2022, TSC established the Supply Chain Management Department, which is tasked with integrating procurement resources from each site and optimizing the overall supply chain. Sustainable chain management at TSC encompasses various aspects such as resources, demand, manufacturing, and supply.
We review the collaborative process flow and operating rules of both production and sale sides, as well as the design of features of the auxiliary operating system based on the monthly production and sales cycle along with the weekly production and sales management platform mechanism, in order to ensure the integration of processes, cut the design of non-standard operations, and comply with the principles of internal audit and internal control, while leading cross-functional teams to support the company’s operational growth target with a collaborative model that is in line with industry practices to the greatest extent possible.
In an effort to ensure that supply chain scheduling considers inventory risks and meets customer needs, the Supply Chain Management Department follows the principle of supply continuity to ensure uninterrupted supply in unforeseen or force majeure events in compliance with the principles of supply continuity, supplemented with flexible control of inventory policy based on changes in product and market demand. In 2023, TSC introduced the BCM system while gradually developing secondary suppliers to minimize procurement risks. Through the management of supply chain issues and collaboration with the headquarters, each site review potential risks at all times, optimize supply chain resilience and strength on an ongoing basis, as well as provide feedback and review consensus on the strategies and implementation of upstream processes, with a view to ensuring balance and consistency in the supply chain.
While integrating organizational resources and strategies, TSC also engages in collaboration with customers. By connecting contracts with information technology, we maintain collaboration and timely exchange of information between both parties to enhance the intensity of supply chain collaboration and its flexibility in response to contingencies while working towards lowering supply chain costs and enhancing efficiency together, enhancing information transparency on both sides, and jointly improving the flexibility of the supply chain system to respond to demand or external factors. On the other hand, TSC also plans training for supply management talents, strengthening information synchronization across departments, and reducing procurement costs by implementing automation and standardized management.
Supplier Sustainability Impact Assessment
TSC continues to keep a close eye on and review supply chain resilience. In addition to the basic criteria for supplier selection, which include technique, delivery, quality, and cost, TSC also conducts comprehensive evaluation from the economic, environmental, and social aspects, with a view to putting our risk management and sustainability philosophy into practice. In an effort to ensure that our suppliers work together towards the goal of sustainability, TSC has taken the initiative to formulate the RBA Supplier Code of Conduct in compliance with the RBA Code of Conduct since 2017. This code of conduct, which is applicable to all operating sites upon approval by the Chairman, not only requires suppliers to comply with the laws and regulations in the regions where they run their business, but also sets out clear provisions in various areas, such as labor, health and safety, the environment, and business ethics, whose content encompasses workers’ human rights, anti-discrimination and anti-harassment, occupational safety, the environment, and ethical corporate management. TSC regularly updates this code of conduct based on the official version release by RBA and discloses it on our official website for stakeholders’ reference and compliance purposes.
Furthermore, not only are new suppliers required to sign up for the RBA Supplier Code of Conduct, but TSC also carries out supplier evaluation in accordance with the Regulations Governing Vendor Management, which encompasses the supplier’s records of environmental and social impacts, and whether the supplier implements various standards and certifications that extend to environmental protection, safety and health, and management systems, such as the ISO 14001 Environmental Management Systems and ISO 45001 Occupational Safety and Health Management Systems standards, in hopes of stepping up efforts to fulfill corporate social responsibility together with our suppliers.
At the same time, we also keep track and review laws and regulations on materials specific issues, such as tantalum, tin, tungsten, and gold in product composition, ban on Russian steel materials triggered by the Russian-Ukrainian war, restrictions on the export of specific materials from China induced by the US-China trade war, and investigations into products or materials manufactured with Uyghur forced labor in violation of human rights, or restrictions and impacts of specific laws and regulations on the supply chain. TSC adopts policies, conducts due diligence, and make declarations to ensure the vitality of our supply chain and the provision of services and protection for customers.
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