Taiwan Mask Corporation selects high-quality suppliers based on their self-assessment data, which includes basic information such as company profile, business registration, and financial status. Social and environmental performance is also incorporated into the selection criteria for new suppliers; any suppliers with related negative or non-compliant records will not be considered for cooperation.
To build a sustainable supply chain, Taiwan Mask Corporation has formulated a "Supplier Code of Conduct" and requires suppliers, especially those of key raw materials and equipment, to sign the "Supplier Code of Conduct" or a document with equivalent legal effect. It actively promotes this to all suppliers and guides them to integrate sustainability into their business operations. The code covers employee rights, environmental safety in the production process, product quality, and whether the products themselves and by-products comply with the principles of nature conservation. Taiwan Photomask works with suppliers to fulfill social responsibility and protect the natural environment, moving towards sustainable operation.
The procurement department assumes responsibility of related actions and coordination of internal and external communications.
Manager and staff members of the procurement department.
The company's official website provides a communication channel for suppliers, where it can be provided with immediate feedbacks. The feedbacks are then reviewed and decided with relevant departments on whether to implement improvement measures.
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All key material and equipment suppliers have signed the "Supplier Code of Conduct".
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Based on the supplier's ESG report or conviction report, the key supplier assessment score for environmental, governance, and social outcomes is ≥85 points.
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We continue to push all key domestic and international manufacturers to sign the "Supplier Code of Conduct" and achieve a key supplier evaluation score of ≥85 points.
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All key material and equipment suppliers have signed the "Supplier Code of Conduct".
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Key supplier evaluation scores (including green procurement, risk assessment, responsible mining, employee human rights, product quality, environmental and safety) all reached ≥85 points.
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To comply with the requirements of the Conflict-Free Metals and Responsible Business Alliance (RBA), Taiwan Mask Corporation requires its raw material suppliers to sign an Hazardous Substance Free (HSF) commitment letter and a REACH Substances of Very High Concern (SHC) investigation letter (M10-SR-08-0015) annually. They must also provide a third-party impartial inspection report proving that the product does not use any of the hazardous substances listed in RoHS and does not use any metals from illegally controlled warlord regions, thus ensuring a reduction in environmental impact and demonstrating responsible sourcing.
To maintain supply chain stability and ensure that the quality of the products supplied meets the highest standards, Taiwan Mask Corporation regularly conducts "Supplier Audits and Inspections" and "Supplier Delivery Quality Assessments." Suppliers are required to complete a "Supplier Audit and Inspection Form" annually and attach relevant records. When necessary, suppliers are required to cooperate with on-site audits, and the results are used as a reference for supplier evaluation. Suppliers whose total score is below 70 points will be listed as suppliers requiring improvement.
Promote local procurement
Taiwan Mask Corporation upholds the philosophy of deep roots in Taiwan and giving back to society, actively promoting local sourcing. By prioritizing local suppliers, we not only increase supply flexibility and reduce operating costs, but also create local employment opportunities and promote domestic economic development. We are committed to increasing the proportion of locally sourced raw materials and establishing long-term, stable partnerships with suppliers to jointly build a green and sustainable supply chain.
| Procurement Region | 2022 Procurement Amount Ratio | 2023 Procurement Amount Ratio | 2023 Procurement Amount Ratio |
| Local Raw Material Procurement | 28.4% | 30.2% | 33.0% |
| Non-local Procurement | 71.6% | 69.8% | 67.0% |
Supplier selection
- Regular "Supplier Audits and Inspections" and "Supplier Delivery Quality Assessments" are conducted. Suppliers are required to complete a "Supplier Audit and Inspection Form" annually and attach relevant records. When necessary, suppliers are required to cooperate with on-site audits, and the results are used as a reference for supplier evaluation. Suppliers whose total scores are below 70 points are listed as requiring improvement. In 2024, an on-site audit was conducted on one supplier, and all aspects met the relevant standards with no areas for improvement identified.
- To maintain product quality, Taiwan Mask Corporation has established a quality assessment mechanism, with the Quality Assurance Department conducting regular evaluations and audits. An annual "Supplier Delivery Quality Assessment" risk rating is implemented. To ensure that all supplier deliveries comply with legal standards, we incorporate economic, social, and environmental standards into the assessment and categorize suppliers based on their scores. If a supplier's score fails to meet the standards, we will require them to submit improvement measures. We will continuously monitor the improvement results. If the assessment results still fail to meet expectations after improvements, our company will terminate the transaction and cancel the supplier's qualification. To mitigate the risk of supply shortages, we will also seek alternative suppliers to reduce the possibility of operational disruptions.
- In 2024,Taiwan Mask Corporation conducted delivery quality assessments on 20 major raw material suppliers. Delivery quality scores were graded from highest to lowest as A to D. Only suppliers meeting the standards could continue to be considered for procurement. Suppliers with a total score below 70 across all evaluation categories were listed as suppliers requiring improvement, thus ensuring the effectiveness of supplier management. This year's supplier performance evaluation results showed no suppliers receiving a D grade; all suppliers met Taiwan Photomask's supplier requirements.
Annual supplier evaluation
- To understand the extent to which the supply chain implements sustainability issues, a "Supply Chain Code of Conduct Questionnaire" was distributed to raw material suppliers in 2023 for self-assessment. Suppliers were required to respond to the questionnaire regarding their implementation status in three main areas: governance, society, and environment. The self-assessment results will serve as the basis for subsequent sustainability risk management. In 2024, 24 self-assessment documents were sent to raw material and equipment suppliers, and 22 were returned.
- The "Supply Chain Code of Conduct Questionnaire" assesses the potential impact on suppliers from three main aspects: governance (including potential impacts on hazardous substances/conflict minerals management, supplier management, integrity in business operations, and risk management); social (including potential impacts on occupational health and safety management and human rights); and environmental (including potential impacts on environmental management, carbon reduction measures, and energy resource management). Based on the suppliers' self-assessment results, our company analyzes and identifies high-risk vendors, providing them with communication and guidance for improvement.
- Analysis of the 2024 sustainability risk assessment questionnaire results shows that suppliers have improved across all aspects compared to last year. In the governance aspect, the average score has reached over 80 points, and we will urge suppliers to improve their management of hazardous materials and conflict minerals, and to continuously strengthen sustainability governance. In the social aspect, the average score across all aspects has reached over 95 points, and in terms of human rights, 90% of suppliers have established relevant labor rights policies and provided complaint channels. In the environmental aspect, 95% of suppliers have conducted inspections in categories one and two, and are planning to inspect category three, with 60% of suppliers setting waste reduction targets. For high-risk suppliers with a total score below 80 points, we identified their potential risks and conducted sustainability document reviews and communications to confirm and understand their risk status.