Supply Chain Management

"MediaTek is a fabless semiconductor R&D company. Risk surveys and carbon footprint inventories indicate that back-end manufacturing operations represent the key link for social and environmental impacts. The principal task of the Company therefore lies in close cooperation with suppliers to reduce potential social and environmental impacts."



| Commitments and Policies

Building of stable partnerships characterized by mutual trust and joint growth with suppliers and establishment of sustainable business models. Supplier screening is carried out based on ESG criteria to confirm that suppliers have relevant management systems and organizational structures in place. Monthly/annual on-site/written audits are conducted and relevant training courses or improvement meetings are scheduled. In addition, supplier conferences are organized to recognize and encourage outstanding suppliers.

  1.    Short-term
    1. Joint setting of a GHG emission reduction goal of 2% annually in cooperation with the supply chain
    2. Signing of the code of conduct by all suppliers in 2022.
  2.    Mid-and long-term
    1. Maximization of the Company’s influence on its suppliers, carrying out of GHG emission inventories, and adoption of management measures for the supply chain in response to domestic and international ecofriendly initiatives in the field of environmental protection and carbon reduction.

| Implementation of a comprehensive supply chain evaluation mechanism to promote supply chain sustainability

As a leading technology provider for the global semiconductor industry, MediaTek is located at the frontend of the value chain. All back-end processes involving raw material procurement, OEM manufacturing, packaging, and testing are carried out by suppliers, which results in the formation of partnerships characterized by professional division of labor and mutual cooperation. Risk surveys and carbon footprint inventories indicate that back-end manufacturing operations represent the key link for social and environmental impacts. Close cooperation with suppliers to reduce potential social and environmental impacts therefore represents the principal task of MediaTek in the field of green operations.


MediaTek upholds the vision of building a sustainable business model and compiles standards and initiatives in the economic, social, and environmental dimensions for the design of a responsible supply chain management mechanism and ESG risk assessments paired with purchasing behavior. New suppliers must pass ESG risk assessment reviews before being listed as a qualified manufacturer. Upon approval, listed suppliers are still audited on an ongoing basis to ensure conformity and compliance with various management rules and regulations. MediaTek continues to maximize its influence as an industry leader by relying on annual audits, supplier conferences, and discussion forums with the ultimate goal of creating sustainable business models in collaboration with value chain partners.



 

With a view to building long-term, stable partnerships with its suppliers, MediaTek strives to incorporate sustainable development concepts into its sustainable supply chain management approaches. The goal lies in the advance control of potential risks and detection of potential market opportunities. Since the launch of social responsibility audits in 2016, we have not only requested suppliers to sign social responsibility statements but also rely on the RBA (Responsible Business Alliance) online management system to manage sustainability conduct and performance of suppliers.

  • MediaTek Supplier Code of Conduct
    • Achievement in 2021: 93% signing rate
    • Target: 100% signing rate in 2022






  • Supplier ESG Risk Assessment and Procurement Control Procedures

Assessment dimensions and standards are shown in the table below. Suppliers that meet relevant assessment criteria (scores of 60 or above) are listed as preferred manufacturers. Conversely, suppliers classified as high risk must pass on-site or written audits and inspections to verify conformity to ESG requirements before being listed as qualified manufacturers. If suppliers are unable to meet the required standards despite guidance or assistance provided by MediaTek, order amounts are reduced or business relationships are terminated.





  • Supplier Sustainability Scoring Standards

MediaTek examines its suppliers in four different dimensions to gain a clear understanding of concrete
requirements and actions adopted by suppliers with regard to corporate sustainability indicators. In this
process, suppliers also get a better understanding of MediaTek’s priorities and concrete requirements in
the field of sustainability actions.




| Local Procurement

MediaTek embraces the principle of local procurement to enable local citizens to reap the benefits of economic development and reduce carbon emissions caused by the transportation of raw materials. The total value of orders placed with local suppliers in Taiwan exceeds NT$ 250 billion each year (local manufacturers account for the bulk of raw material and general procurements).





| Actions harnessing influence on suppliers

MediaTek upholds the spirit of corporate citizenship and proactively implements CSR concepts. With a view to demonstrating its commitment to its own responsibility and that of its suppliers, the Company has formulated a supplier code of conduct to facilitate the joint fulfillment of the responsibility of the Company and its suppliers as corporate citizens. MediaTek relies on a comprehensive assessment and incentive mechanism to encourage continued dedicated efforts by its suppliers in the field of corporate social responsibility

  • Plan: Organization of annual responsible supply chain forums
  • Performance measurement: CSR assessment system for MediaTek suppliers, ESG risk assessment
  • Benefits for the Company: Stable IC industry supply chain with excellent ESG-related performance ducive to sustainable growth of the Company







To learn more about MediaTek's sustainable supply chain, please see p.67-73 of the report.