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Sustainability Management

As the leading provider of semiconductor assembly and test services and a major consolidator of systems and converging technologies, ASE Group plays a vital role in transforming our society into a green and low-carbon economy. We regard sustainability and corporate citizenship as the growth opportunity and commit to providing eco-efficient and responsible service to our customers to achieve satisfactory performance in environmental, social and governance (ESG).

The ASE "Corporate Social Responsibility Best Practice Principles" outline the highest guiding principles for ASE's corporate social responsibility practices, and the "Corporate Sustainability and Citizenship Policy" forms the basis of our sustainability policy and commitment*.

The principles and policy form the ASE Sustainability Management Framework where we identify and evaluate business drivers, risks and opportunities related to sustainability trends, formulate corresponding "Sustainability Strategy" and focus on ASE's future.

Our "Sustainability Guidance" assists ASE to strengthen its sustainability strategy in its operational management while creating value. We continue to draw upon feedback from our partners and stakeholders and continue to adjust and improve on our decision making process for the overall sustainability of the economy, environment and community.

Corporate Governance
Management Approach

Environmental Sustainability
Management Approach

Employee Care and Development
Management Approach

Supply Chain Development
Management Approach

Corporate Citizenship and Social Involvement
Management Approach

In 2015, ASE formally established the Corporate Sustainability Committee ("CSC") as the highest level of organization for the ASE Group's sustainability management. The first term of the CSC is chaired by the Chief Operating Officer* and comprised of ASE's top management executives, who also serve as members of the board of directors. The CSC is responsible for overseeing corporate-wide sustainability affairs and making decisions, and reports directly to the board of directors. The "Corporate CSR Center" serves as the secretariat of the CSC; it is a full-time unit dedicated to the promotion of the ASE Group's sustainability, and it reports the promotion and implementation status of sustainability issues to the CSC every quarter.

The CSC is fully supported by five Sustainability Taskforces, in which representatives from all of our corporate responsibility related business segments are brought together. The Sustainability Taskforces include "Corporate Governance Taskforce", "Environment and Green Innovation Taskforce", "Supply Chain Management Taskforce", "Employee Care and Development Taskforce", and "Social Involvement Taskforce", with relevant vice presidents and department supervisors appointed as taskforce coordinators. Each taskforce holds meetings regularly or irregularly, and convenes formal taskforce meeting at least once half yearly to report to taskforce coordinators on the implementation effectiveness and emerging issues on sustainability. Based on their respective practical needs, the Sustainability Taskforces integrate and coordinate ASE's global resources in different operational approaches. Through the involvement in external organizations, the Sustainability Taskforces communicate and engage with different stakeholders to strengthen each taskforce's sustainable functions, initiate related key sustainability projects and develop relevant performance indicators, and assist the ASE Group's promotion and implementation of sustainable governance system. Our global manufacturing sites follow instructions and decisions of the CSC to manage local sustainability issues and implement sustainability actions in daily operations.

In 2017, our Chief Executive Officer* and Chief Administrator Officer were invited to join CSC to become committee members. In the 2017 CSC annual meeting, committee members reviewed the previous year's sustainability performance and actual level of target achievement, while formulating operational direction, goals and promotion plans of 2018 for each Sustainability Taskforce. For sustainability performance and target of each Sustainability Taskforce, please refer to details in related chapters.

In today's rapidly changing business context (including environmental degradation, energy and resource shortages, increasingly severe climate change, tightened government regulations, and lack of revolutionary breakthroughs in information technology, etc.), traditional shareholder interest-oriented financial reporting is no longer able to reflect the broad and longer-term consequences of the decisions organizations make to respond to sustainability-related risks and opportunities in the future. The long-term sustainable development of an enterprise is no longer aiming to maximize only shareholder value, but rather to maximize value for all stakeholders. ASE strives to create value for all stakeholders while simultaneously driving shareholder value.

In 2017, we has undertaken an value assessment study using PwC's Total Impact Measurement and Management (TIMM) framework and in collaboration with PwC Taiwan to assess the sustainable value created by ASE operations from four key aspects: economic, tax, social, and environmental. Based upon the monetization framework detailed in the Natural Capital Protocol and the Social Capital Protocol as well as the Integrated Reporting principles, we apply TIMM to assess our operations'impacts on stakeholders in the aforementioned aspects and monetize the impacts thereby facilitate business decision making, performance evaluation, and stakeholder communication. Since the methodologies of TIMM are still under development, the results from the assessment does not reflect nor has any impact on ASE's past, present, or future financial performance.

ASE's sustainable value for stakeholders arise from positive changes in the following aspects:

  • Economic aspect: We review and evaluate the effects of key impact drivers on our shareholders, suppliers, and employees and express the effects in monetary units.
  • Tax aspect: We assess our contribution to the local government's public finance according to the overall tax paid in our operation activities, which, in turn, represents our contribution to the well-being of local people.
  • Social aspect: We measure and value the consequences of business activities on our suppliers, employees, and communities based upon the seven principles of Social Return on Investment.
  • Environmental aspect: We follow the Natural Capital Protocol to measure and monetize our environmental impact of business operations.
Through the learnings from the sustainable value assessment, we hope to gradually incorporate integrated thinking into our decision-making process. Conventional financial reporting focus on business financial performance and traditional business decision making has tended to focus on relatively short-term financial outcomes. In contrast, the sustainable value assessment put more emphasis on the interaction between different capitals, such as financial, manufacturing, intellectual, human, natural, and social capitals, as well as how to derive short-, medium- and longterm value by using and affecting the capitals. Embedding integrated thinking in the company culture promotes more holistic, long-term thinking and decision making by the organisation across a comprehensive range of factors material to long-term value creation.

Sustainable Value Assessment Results
We apply TIMM to assess our sustainable value created for stakeholders in the economic, tax, environmental, and social aspects. The 2016 and 2017 TIMM assessment results show that our overall sustainable value in 2017 grew by 9% compared to 2016. Our sustainable contribution to stakeholders in the economic aspect forms the majority (more than 60%) of the overall sustainable value in both years, in particular through our operations' positive impact on the financial satisfaction and livelihood maintenance of stakeholders. Payroll for employees accounts for the highest proportion of the economic sustainable value. We also make a sizeable contribution to support the local government's finance and the well-being of local people via the taxes we paid. Like most manufacturing companies, our operations inevitably have a negative impact on the environment while creating economic value. GHG emissions and water consumption accounted for the largest proportion (over 90%) of the overall environmental impacts. We make other contributions to society, mostly from the value created through supplier partnerships and employee engagement. The further explanations of the assessment results on each aspect are presented in the relevant sections of this report. A document containing all the assumptions and the calculation values used, together with the detailed TIMM framework and stakeholder influence maps, can be found on our website.

As the noted English economist John Maynard Keynes once said, "It is better to be roughly right than precisely wrong." We are not pursuing a precise number that represents a specific meaning, but rather expecting to use the TIMM assessment results as a reference for setting up key performance indicators for each sustainable management aspect, as the first step towards better sustainable management using total-impact based decision making, thereby creating greater value for stakeholders while using limited resources.

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