Supply Chain Management
The Company sees suppliers as our important partners. We are committed to building mutual trust and a stable sustainable supply chain, as well as flourishing businesses together with our suppliers. The Company assesses suppliers against the criteria, namely Quality, Cost, Delivery, Service, and Sustainable Risks, by using our business influence to demand that they disclose sustainability information and improve their sustainability performance.
Four Major Principles of Supply Chain Management
New suppliers of the Company are required to meet basic corporate social responsibility assessments, covering human rights, occupational health and safety, and environmental management. Business cooperation with the Company may only commence after passing the assessment. Subsequently, suppliers meeting the transaction criteria are also required to complete the “Supplier/Contractor Sustainability Risk Assessment Questionnaire.” Therefore, the percentage of new suppliers screened using environmental standards and social criteria is 100%. At present, SStek only requires new suppliers to sign a Supplier Commitment Letter and has not yet applied social and environmental criteria for screening new suppliers.
The Group stipulates in procurement contracts with suppliers that they must comply with the RBA Code of Conduct. Each year, based on transaction criteria set by the Production Management and Procurement Departments, existing suppliers are required to complete the “Supplier/Contractor Sustainability Risk Assessment Questionnaire,” which covers five areas: labor, occupational health and safety, environmental protection, supply chain management, and corporate governance. The Group’s quality assurance personnel conduct a secondary review and classify suppliers’ sustainability risk levels based on their scores. Subsequent supply chain management and optimization are carried out based on suppliers’ long-term sustainability performance.
In 2025, a total of 76 suppliers were assessed for environmental and social impacts through the “Supplier/Contractor Sustainability Risk Assessment Questionnaire.” Among them, 2 suppliers were identified as having significant actual or potential negative impacts on the environment or society. The primary risks included incomplete policies, lack of environmental management plans, and absence of supplier management systems. Both suppliers have not yet committed to corrective actions (0% of suppliers agreed to improvements). The Procurement Department will continue to monitor the progress of non-compliant suppliers over the next two years. The percentage of supplier relationships terminated following assessment in the current year was 0%.
At the same time, the Group identifies key suppliers based on factors such as procurement amount, delivery frequency, and supply nature, in accordance with risk assessment results. Key suppliers are required to sign the “RBA Supplier Code of Conduct” (with a 100% signing rate) and to undergo an annual RBA audit conducted by the Group’s professional personnel. In addition, the Group emphasizes enhancing suppliers’ sustainability management capabilities. Through RBA audit briefings and training courses, suppliers are educated on topics including the prohibition of child labor, human rights, anti-discrimination/anti-harassment, health and safety, pollution and greenhouse gas management, anti-corruption, grievance mechanisms, privacy, management systems, material restrictions, and responsible mineral sourcing. These efforts aim to strengthen sustainability awareness across the entire supply chain. In 2025, a total of 25 suppliers participated in the annual supplier training program.
In addition, Employees in departments with procurement functions related to core business operations (Production Management and Procurement Departments) are required to complete the annual “Sustainable Supply Chain – Role Awareness and Capability Development Course.” The course covers topics including the definition and importance of sustainable supply chain management, the relationship between procurement behavior and the era of carbon pricing, product carbon footprint and organizational carbon emissions, and sustainable raw materials , with the aim of enhancing the sustainable supply chain management capabilities of relevant personnel.
Corresponding sustainability standards that suppliers at all levels should meet
Purchasing Department and Production Control Department should prepare and regularly check the “QR2303 Main Supplier List” every year. The inventory can be based on annual expenditure, key components of core business, multiple procurement, within the supply chain of the ICT (Information and Communication Technology) industry, etc.
Raw material suppliers are divided into A Level, B Level and C Level based on the total purchase amount and continuing transaction amount. Sub-contractors are classified into A Level and B Level based on production volume and whether they are customer designated processing factory. The sustainability standards that suppliers at all levels of the Purchasing Department and Production Management Department should meet are as follows:
Grading | Sustainable standards |
|---|---|
A level | Obtain ISO 14001 certificate |
Obtain ISO 14064-1 certificate | |
Obtain ISO 45001 certificate | |
Fill out the “QR0654-A Supplier/Subcontractor Sustainability Assessment Questionnaire” every year | |
B or C level | Fill out the “QR0654-A Supplier/Subcontractor Sustainability Assessment Questionnaire” every year |
Supplier Audit
To reduce the sustainability risk in our supply chain, the Company has established the “RBA Vendor Management Policy”, with an annual audit being conducted on all of our critical suppliers11 with respect to labor rights, health and safety, environmental management, code of ethics, and compliance and effectiveness of their supply chain management. A total of 22 critical suppliers were audited on-site this year. The remaining critical suppliers have all obtained RBA VAP certification, so they only need to provide third-party reports for documentation audit. Auditors will promptly inform the supplier of any defects found during their audits. The defects will then be reported to the department head and the supplier will be asked to provide an improvement plan; furthermore, the supplier will be required to submit the improvement plan containing corrective actions within one week.
The overall audit pass rate in 2024 was 77.08%, with 242 deficiency items identified. The main causes of deficiencies were excessive overtime, zero-fee recruitment for migrant workers, and environment-related issues. The Company’s audit representatives have communicated the audit findings and discussed possible improvement plans with each supplier. The Company did so because according to the management regulations, the Company’s audit representatives and the supplier may agree on a deadline for improvement completion. If the supplier fails to improve before the deadline, the Company will reduce or suspend the orders to be placed with it, or remove it from the List of Approved Suppliers.
Defect Analysis for Supplier Audit
Metal Raw Materials
The Company has calculated the metal usage and recycling ratio in 2025 for major suppliers in PCB, Connector and structural components. The results are as follows.
Item | Recycled material weight(t) | Total Amount(t) | Recycled proportion |
|---|---|---|---|
Aluminum (Al) | 4.15 | 658.84 | 0.63% |
Stainless steel | 0.00189 | 0.88 | 0.21% |
Copper (Cu) | 578.66 | 912.22 | 63.43% |
Nickel (Ni) | 0 | 2.30 | 0.00% |
Gold (Au) | 0.000048 | 0.39 | 0.01% |
Iron | 0 | 38.19 | 0.00% |