Sustainable Supply Chain

Sustainable Supply Chains

External procurement considers both the impact to production, services, and operations, as well as risks to our CSR and reputation. Therefore, supply chain management at OSE is based on regulatory compliance to ensure supply chain labor rights, environmental protection, safety, and health risks are included in risk management. We identify high risk suppliers and implement improvement measures according to assessment results to help suppliers enhance the quality of management. OSE hopes that this reduces operational risks and costs for both us and the supplier so that we may enjoy a partnership filled with sustainable growth.

Sustainable Supplier Management Approach

As a global company, OSE not only focuses on enhancing competitiveness in terms of product quality and project management but also strives for sustainable supply chain management. Through initiatives such as the Responsible Business Alliance (RBA) standards/requirements, sustainability risk assessments, onsite
audits/improvement measures, and supplier capability enhancement, OSE is building a robust supply chain management mechanism and working hand in hand with suppliers towards a sustainable future.

OSE has long been committed to social responsibility, environmental protection, business ethics, and operational management. It pays high attention to international initiatives and requirements, including the United Nations Global Compact, Universal Declaration of Human Rights, and Social Accountability 8000
(SA 8000), which encompass norms related to human rights, labor standards, environment, and anticorruption. In line with these principles, OSE has developed Supplier Code of Conduct to guide suppliers’ behavior.

Local Procurement

OSE will continue to promote a localized procurement strategy, which is an important part of implementing sustainable business practices and corporate social responsibility.

【Supplier Local Procurement Ratio】

Note: OSE’s significant operational base is in Taiwan. Therefore, the definition of local procurement refers to the proportion of suppliers from the Taiwan region.

【Required Documents for New Suppliers】

In 2023, a total of 69 new OSE suppliers signed the “Declaration of Conformity for Honest and Code of Conduct,” “Declaration for Non-use of Conflict Minerals,” and “RBA Pledge,” demonstrating that our suppliers value environmental protection, occupational safety, labor rights, and ethical business practices.

Quailed Supplier Audit Mechanism

OSE is committed to improving the sustainability of its supply chain. Every year, OSE conducts periodic on-site inspections at suppliers’ facilities to verify their compliance with OSE’s sustainable supply chain standards. If suppliers couldn’t meet OSE’s requirements, the cooperation will be suspended until the improvements are made. We are dedicated to establish a comprehensive supplier audit and management mechanism.

In 2022, there were 28 IC Semiconductor Group supplier questionnaires evaluated, and on-site audits were conducted for 1 suppliers engaged in actual production and manufacturing. For EMS Group suppliers, there were 12 questionnaire evaluations and 4 on-site audits. After requesting that improvements be made, all audited suppliers completed the necessary improvements within the specified time frame, with a 100% response rate. OSE did not need to terminate any supplier contracts due to non-compliance. Customers or procurement makes a request Select new material or supplier Ensure compliance with relevant guidelines (i.e.: identification of hazardous substances) Confirm with assessment Include in list of potential suppliers Audit of quality system Confirm assessment results with qualified suppliers

Sustainable Supply Chain Management Performance

To raise supplier awareness of sustainability and convey ESG requirements in the supply chain, OSE holds an annual supplier conference and promotes sustainability projects in collaboration with the supply chain.

Sustainable Supply Chain