Stakeholder Engagement｜Analysis of Material Topics
Analysis of Material Issues and Stakeholder Communication
Analysis of Material Issues
Nuvoton pursues corporate sustainability by referencing the 2021 version of the Global Reporting Initiative (GRI) Standards and the AA1000 Accountability Principles Standard issued by the Global Reporting Initiative (GRI). It identifies material issues based on the principles of inclusivity, materiality, responsiveness, and impact. Following the GRI 3: Material Topics 2021 framework, it constructs a process for analyzing material issues to assess the positive and negative impacts of these issues on the environment, economy, and people (including human rights).
Analysis Process of Material Issues
01 Establishing Sustainability Issues Database
Drawing upon past sustainability issue databases, we examine industry sustainability practices in alignment with international trends to establish this year's sustainability issue repository. This repository encompasses sustainability issues across four dimensions: economic, governance, environmental, and social.
02 Surveying Issues of Concern by Stakeholders
To gauge the level of stakeholder concern regarding sustainability issues, we distributed stakeholder concern surveys to various stakeholders. Simultaneously, senior executives from Nuvoton Taiwan and Nuvoton Japan, along with representatives from working groups, completed stakeholder importance surveys to ascertain the significance of various stakeholders to the company. Finally, weighted scores for stakeholder concern regarding sustainability issues were calculated based on the results of both surveys.
03 Evaluating Sustainability Impacts
Representatives from senior management of Nuvoton Taiwan and Nuvoton Japan, as well as representatives from working groups under the Sustainability Development Committee, evaluated the positive and negative impacts and likelihood of occurrence of sustainability issues on the environment, economy, and population (including human rights) using sustainability impact assessment questionnaires.
04 Ranking and Confirming Material Issues
Building upon the significance of impacts determined from the results of Phases 02 and 03 of the questionnaire by the Sustainability Development Committee, the top two issues from each of the economic, governance, environmental, and social dimensions were selected, considering adjustments to the company's sustainable development priorities, to form the final 10 material issues.
05 Presented to the Board of Directors for approval.
The Sustainability Development Committee reviewed the analysis results of the material issues and working groups formulated management policies for each material issue. Finally, these were presented to the Board of Directors for approval.
Matrix diagram of material issues
It is generated based on the weighted stakeholder concern scores and sustainability impact assessment results, with the 10 material issues for the year 2023 indicated within the matrix.
Sustainability Impact Assessment and Ranking
List of Material Issues and Their Impact
| Material Issue | Corresponding GRI Themes and Standards | Significance for Nuvoton | Aspects of Impact (Positive/Negative) | Description of Economic, Environmental, and/or Social Impact (Response to Risks and Opportunities) | Lead Divisions | |
|---|---|---|---|---|---|---|
| Corporate Governance and Business Integrity |
| Corporate governance assessment of key issues is critically significant for Nuvoton, as it helps ensure the company's sustainable development, meet stakeholder expectations, comply with relevant regulations, effectively manage risks, maintain long-term competitiveness, and establish credibility. These elements are crucial for the company's long-term prosperity. | Positive Positive Sound corporate governance and business integrity. Through the formulation and implementation of relevant rules and guidelines, establish standards of conduct for operational activities, generating positive impacts on the company, society, and the environment. Negative Failure to execute comprehensive corporate governance and business integrity may lead to the misuse of company resources for activities detrimental to the company, society, and the environment, negatively impacting stakeholders, and even resulting in additional costs related to legal proceedings and lawsuits due to violations. | Economic Operating with integrity and good corporate governance principles are fundamental to business operations, instilling confidence in stakeholders towards Nuvoton, encouraging investment in and commercial transactions with Nuvoton, thereby positively affecting revenue and the economy. Environmental Embracing the concept of integrity in business operations and having robust governance systems can prevent companies from engaging in environmentally harmful practices and reduce the occurrence of cost shifting to the environment due to economic considerations. People Effective corporate governance systems and business integrity practices can prevent companies from facing legal penalties or even closure due to violations, as well as prevent the misuse of company resources, thereby safeguarding employees' rights and ensuring equal treatment. | Sustainability Development Committee Corporate Governance Working Group, Nuvoton Japan Internal Control Office, Nuvoton Japan Corporate Strategy Office | |
| Management Strategy and Business Performance |
| Management strategy and business performance are key to Nuvoton's sustainable development. Developing comprehensive business strategies can maximize cost utilization and increase revenue, thereby improving corporate profits and operational efficiency. | Positive Developing comprehensive short, medium, and long-term business strategies and goals effectively enhances operational performance and maintains market competitiveness. Negative Failure to anticipate market changes may result in missed business opportunities, leading to loss of customers and orders. | Economic Collaborating with academia for early-stage research and implementation, maintaining AI development momentum, and increasing long-term revenue opportunities. Environment Introducing digital technology into energy-saving applications and facility management can enhance operational efficiency and have a positive impact on the environment. People Developing applications for smart manufacturing to enhance efficiency, process quality, and product yield in work and production. | President’s Office | |
| Innovation and R&D Management | Customized Topic | Innovation and research capabilities serve as the engine for Nuvoton's continuous growth. | Positive Continuously enhancing enterprise innovation and growth momentum by providing novel products and services and increasing market share. Negative Failure to retain advanced technologies may result in the inability to provide innovative services or products in response to market changes, reducing market competitiveness. | Economic Practicing innovation, creativity, and entrepreneurship annually to promote the idea of industry digital prosperity through innovation. Environment Integrating environmental and intelligent technologies to expand applications can accelerate data integration and monitoring, reducing environmental impacts. People Encouraging employees to contribute innovative ideas and rewarding selected proposals, actively promoting innovation through strategic and concrete actions. | Product Working Group of the Sustainability Development Committee | |
| Information Security and Privacy Protection | Customized Topic | Ensures the company's long-term stable development and customer satisfaction while protecting corporate and customer assets and reputation. | Positive
Negative
| Economic Enhancing brand image and reputation in customers' minds to expand market size and explore new business opportunities. Increasing customer loyalty.Avoiding legal risks and liabilities to maintain corporate reputation and image. v Securely maintaining and upgrading information equipment to improve efficiency, reduce energy consumption, and promote the development and application of green technology. People Ensuring the non-abuse, disclosure, and infringement of personal information of employees and customers to safeguard basic human rights and corporate social responsibility. | Information Security Advocacy and Social Engineering Education Training, Nuvoton Japan Information Security Promotion Committee | |
| Supplier Sustainability Management |
| Suppliers provide Nuvoton with the raw materials necessary for its operations and production. Nuvoton is committed to pursuing mutual growth with its suppliers. | Positive Establishing a sound supplier management mechanism and collaborating with suppliers to build a sustainable supply chain.Monitoring suppliers' implementation of human rights protection and achieving energy-saving, carbon-reduction, and cost-reduction objectives together. Negative Failure to implement supplier sustainability management may result in the inability to monitor suppliers' human rights and environmental management practices, potentially leading to adverse impacts on the company, society, and the environment. | Economic Establishing a comprehensive supply chain management system to stabilize the supply of goods and improve operational efficiency, leading to increased revenue. Environment Collaborating with suppliers to enhance sustainability performance, including developing energy-saving and carbon-reduction plans.Neglecting environmental management in the supply chain may increase the risk of regulatory violations People Incidents of human rights disputes in the supply chain may decrease customer trust and order quantity. | Sustainability Development Committee Supplier Management Working Group | |
| Climate Change | Customized Topic | Nuvoton recognizes the importance of climate change on business sustainability. Considering the financial risks climate change may pose to operations, Nuvoton follows the TCFD's recommendations to identify climate-related risks and opportunities and incorporates them into the company's risk management framework as one of the sustainability development strategies. | Positive Integrating climate change into management practices, product research and development, and operational goals can help the company address the impacts of each climate risk and opportunity. Negative Failure to integrate climate change into management practices, product research and development, and operational goals may result in an inability to proactively address climate-related risks and opportunities and mitigate the impacts of climate change | Economic Assessing the impact of each climate risk and opportunity on development strategies and financial implications to expand the scale of green product development, enhancing competitiveness and industry chain value. Environment
People Addressing and implementing measures to mitigate the potential impacts of climate change on employees' work and life in advance. | Responsibility lies with the financial unit and is jointly supervised by the Sustainability Development Committee. | |
| Greenhouse Gas Emissions | 305 Greenhouse Gas Emissions | issue of greenhouse gas causing global warming affects the sustainability of the global ecology. Nuvoton cannot stay aloof and considers it a key issue for corporate sustainable development, while actively promoting energy conservation and carbon reduction. | Positive Understanding the company's greenhouse gas emissions, effectively managing data, and planning future carbon reduction pathways and strategies. Negative Failure to effectively manage greenhouse gas emissions increases the risk and expenditure of future carbon tax and fees. | Economic Procuring energy equipment that meets the low-energy standards announced by the Energy Administration of the Ministry of Economic Affairs and establishing energy-saving certification for energy equipment. Environmental Conducting organizational greenhouse gas inventories and planning carbon reduction strategies. People Strengthening employees' awareness of environmental protection and energy conservation. | Sustainability Development Committee Energy Conservation and Carbon Reduction Working Group | |
| Energy Resource Use and Consumption | 302 Energy | Nuvoton adheres to the concept of "environmental sustainability" to minimize the environmental impact during product design, services, activities, and production. We commit to complying with energy-related regulations and meeting the needs of stakeholders, aiming to create a green and energy-efficient environment through the implementation of energy management systems. | Positive Enhancing the company's energy efficiency and implementing energy conservation and carbon reduction measures. Negative Failure to effectively manage energy resource consumption may increase future risks and operational costs. | Economic Establishing an environmental management system to plan, implement, and inspect energy resource management, thereby improving energy resource utilization efficiency. Environmental Installing solar energy-saving equipment to increase the proportion of renewable energy usage. People Strengthening employee awareness of environmental protection and energy conservation. | ||
| Talent Appreciation and Cultivation |
| The company's growth is built on the professionalism and management capabilities of its employees. Recruiting, retaining, and developing talented individuals is a critical task for the company. Human capital is an indispensable key factor in the company's operations, and maintaining talent superiority is synonymous with maintaining the company's competitiveness. At Nuvoton, talent is recognized as a crucial cornerstone for the sustainable development of the enterprise. The company's technological advancements and competitive advantages are continuously maintained in the market due to outstanding talent. | Positive The company emphasizes employee remuneration, benefits, development, and empowerment, leading to an activated corporate culture and improved service/production efficiency and product quality, thereby enhancing the company's competitive advantage in the market. Negative Neglecting employee remuneration, benefits, and development may result in talent loss, inadequate training, decreased product quality, or operational errors, leading to a decline in the company's competitiveness. | Economic Talent is the foundation of enterprise growth. By valuing and continuously developing employees, it is possible to enhance their innovation and efficiency, thereby increasing the company's competitiveness and revenue growth momentum. Environment NA People Nuvoton values and actively cultivates its employees. This approach helps attract and retain talent, leveraging the benefits of talent to enhance employee engagement and satisfaction in their work. | Sustainability Development Committee Labor Rights Working Group | |
| Occupational Safety and Health | 403 Occupational Safety and Health | Occupational safety and health are not only a legal obligation for companies but also the cornerstone of establishing a healthy, safe, and sustainable corporate culture. By actively investing in and practicing occupational safety and health management, companies can achieve long-term sustainable operation. | Positive Through a well-planned occupational safety and health system, employee and contractor workplace safety and health can be effectively maintained, reducing direct and indirect damage caused by occupational accidents. Negative Lack of a comprehensive occupational safety and health system may jeopardize personnel safety and health, affecting the company's image, product quality, and labor relations. | Economic An effective occupational safety and health management system can help companies identify workplace risks, enabling them to prevent accidents in advance and reduce the probability of legal penalties due to occupational safety and health incidents. Environmental A proper occupational safety and health management system can assist companies in managing hazardous substances, ensuring proper monitoring and disposal of organic solvents, dust, specific chemicals, and other hazardous substances in the workplace, thereby reducing environmental burden. People A good occupational safety and health management system can effectively protect the safety of contractors and employees, establishing a safe and healthy workplace. | Sustainable Development Committee Occupational Safety and Health Working Group |