Rechi Precision : Rechi2021 ESG report

2021

RECHI PRECISION CO., LTD.

Environmental, Social, and Governance Report

Environmental, Social, and Governance Report

Table of Contents

• Business Philosophy

• About this Report

☆. 1 Reporting period ☆. 2 Reporting scope ☆. 3 Reporting principles ☆. 4 Report verification

☆. 5 Corporate social responsibility reports over the years

☆. 6 Contact point

☆. 7 Stakeholder engagement ☆. 8 Category of stakeholders

☆. 9 Stakeholders' issues of concern and communication mechanism

☆.10 Identification and ranking of materials topics

☆.11 Boundaries and impacts of materials topics

CH1 Operating Highlights

1. Sustainable Development Management Approach
2. Company History
3. Corporate Governance
4. Risk Management and Strategy

01

02

02

02

02

02

02

02

03

04

05

06

08

09

09

10

14

21

1.5	Economic Performance	31
1.6	External Initiatives and Memberships	34
1.7. Ethical Corporate Management	35
CH2 Supply Chain Management	37
2.1	Supply Chain Management Policy	37
2.2	Supply Chain Awareness-Raising and Audit 38
2.3	Supply Chain Management Commitment	38
2.4	Supply Chain Sustainability Regulations	39
2.5	Restricted Hazardous Substance	40
	Management
CH3 Sales and Quality	41
3.1	Sales Service Management Approach	41
3.2	Product Quality Management Approach	42
3.3	Products and Services	43
3.4	Energy Conservation Index	55
3.5	Marketing and Promotion	56
3.6	Customer Services	56

CH4 Environmental Protection

60

1. Environmental Protection Management Approach
2. Resource Management
3. Environmental Accounting
4. Grievance Channels

CH5 Harmonious Workplace

1. Labor-Management /ManagementApproach
2. Talent Structure
3. Employee Training Management Approach
4. Employee Development
5. Employee Retirement and Transfer
6. Labor-ManagementCommunication
7. Salary and Benefits
8. Occupational Health and Safety Management Approach
9. Workplace Safety

CH6 Social Care

1. Social Care
2. Relevant Groups and Charitable Activities

60

61

64

64

65

66

66

71

73

75

75

76

78

79

87

87

88

Appendices: Appendix 1 GRI Standards content index 89, Appendix 2 BSI Assurance Statement (in both (Chinese and English) 94

	★	☆	CH1	CH2	CH3	CH4	CH5	CH6
01	Business	About this	Operating	Supply Chain	Sales and	Environmental	Harmonious	Appendix
Management	Social Care
	Philosophy	Report	Highlights	Quality	Protection	Workplace
	Commitment

Compressors are key components of energy-

saving products, and it is also a highly competitive

industry

for

technological

innovation.

Rechi

Rechi Precision lives up to the mission of

Precision

Co.,

Ltd.

(hereinafter referred

to as

"maximizing

corporate

values and fulfilling

the

"Rechi

Precision") is

a

top

provider of

forward-

corporate responsibility to care for the Earth." In

looking energy-saving products. We adopt unique

the face

of

global

competition, recurrent

innovative technologies to achieve high efficiency

pandemic outbreaks, and climate challenges, we

for compressors, while

pursuing

ultimate

noise

attach great importance to our ESG policy.

In

reduction. We

also

adopt

new-generation eco-

terms of implementation, we have established a

friendly

refrigerants.

Thus,

we

have

made

Corporate

Governance

and

Sustainable

outstanding contributions to alleviating the impact

Development

Committee

and I

serve as

the

of the

greenhouse effect and

reducing

energy

Chairman: CHEN,

chair. With that, we take on the responsibility to

consumption. We are

committed

to developing

formulate goals and management strategies for

SHENG TIEN

various applications of energy-saving products in

President: FENG,

issues and risks of major impacts on business

alignment with international standards as a world-

MING FA

operations, launch measures and manage the

class

benchmark

enterprise

in

energy

implementation in various business activities and

conservation.

enhance the values of the sustainability culture

With the vision of "creating infinite possibilities

.

in the energy-saving industry and becoming the top

provider of forward-lookingenergy-saving products,"

Rechi Precision continues to implement the "value

innovation" strategy, actively integrate resources and

transition into smart manufacturing, while continuing

to create disruptive energy-saving products. Our

Creating infinite possibilities in the

management team has contributed to the creation of

a positive cycle of low-carbon sustainability, circular

energy-saving industry

economy and social influence with practical actions,

Becoming the top provider of forward-

Vice Chairman: YANG,

to

duly

fulfill

the

Company's responsibility for

sustainable development.

looking energy-saving products

CHENG-MING

	★	☆	CH1	CH2	CH3	CH4	CH5	CH6
02	Business	About this	Operating	Supply Chain	Sales and	Environmental	Harmonious	Appendix
Management	Social Care
	Philosophy	Report	Highlights	Quality	Protection	Workplace
	Commitment

☆.1 Reporting period

☆.3 Reporting principles

☆.5 Reports over the years

This report discloses the approaches adopted by Rechi Precision and the performance in

2021 (January 1, 2021 through December 31,

2021) with regard to economy, corporate governance, environmental protection and social participation based on the environmental, social, and governance (ESG) spirit that is to be

conveyed through this report. This is the 6th CSR report the Company has published. The last issue of the report was published in April 2021 (cycle:

one year). During this reporting period, Rechi Precision did not experience any material changes.

☆.2 Reporting scope

The operating activities of the Guanyin Plant in Taiwan are adopted as the scope of this report. The financial data covers the overall operating performance of the parent and subsidiaries and the remaining indicators do not cover the subsidiaries' data.

This report has been prepared in accordance with the approaches and framework under the

Core Option of the GRI Standards released by the Global Reporting Initiative (GRI). The information disclosed in this report has been reviewed by the head of each unit, confirmed by members of the Corporate Governance and Sustainable Development Committee and reviewed and approved by the President.

☆.4 Report verification

In response to the trend of internationalization and the enhancement of credibility, this ESG report has been verified by the third-party

verification agency in 2021, British Standards

Institution (BSI), for its inclusivity, materiality, responsiveness, and impact as per the GRI Standards and it is confirmed that the contents disclosed in this report are in alignment with the Core Option of the GRI Standards. The BSI Independent Assurance Statement is as in Appendix.

☆.6 Contact point

If you have any questions, comments or suggestions about this report, please contact the contact points below:

Spokesperson Vice President Ke / [e-mail] / 03-4837201 ext. 171 Director Xiao, Human Resources Center / [e-mail] / 03-4837201 ext. 245

Coordinator Huang, Human Resources Center / [e-mail]/03- 4837201 ext. 235

03	★	☆	CH1
Business	About this	Operating
	Philosophy	Report	Highlights

☆.7 Stakeholder engagement

Fulfilling corporate social responsibility is a necessary condition for a company to develop sustainably. Therefore, Rechi Precision's Corporate Governance and Sustainable

Development Committee has identified seven types of major stakeholders per the past operations experience, domestic and international trends, as well as experts', various departments' and the competitors' experience, namely shareholders, groups of banks, employees, clients (distributors), suppliers (contractors), government agencies and other professional groups. We adopt the Company's website, business reports, annual reports and ESG reports that will be published continuously in the future as formal channels for communication or exchange with stakeholders. We also distribute questionnaires to understand various stakeholders' issues of concern and respond appropriately. The procedures are as follows:

CH2	CH3	CH4	CH5	CH6
Supply Chain
Sales and	Environmental	Harmonious	Appendix
Management	Social Care
Quality	Protection	Workplace
Commitment

	Based on the five major principles of the AA1000 Stakeholder Engagement Standard,
1	namely dependency, responsibility, influence, diverse perspectives and tension, the
Corporate Governance and Sustainable Development Committee has identified the main
	stakeholders, including shareholders, banks, employees, customers (distributors), and
	suppliers (contractors), government authorities and other professional groups.
	The structure of the report is in alignment with the GRI Standards published by the GRI as
2	the basis for collection of topics.
	To understand the degree of stakeholders' concern about ESG topics, we conducted an
	online questionnaire survey to investigate the material impact of stakeholders' topics of
3	interest on the Company's sustainable development to prioritize the topics. A total of 104
	copies of questionnaires were returned in 2021.
	Through an analysis of the questionnaires, we created a matrix based on the scores of
4	stakeholders' attention to each topic and the scores of the impact on sustainable
development given by the management. After discussion by the Corporate Governance and
	Sustainable Development Committee, a total of 10 major topics were identified for 2021
	and we have set out effective management approaches to each topic.
	After identification of material topics, corresponding chapters, and boundaries, we will
5	continue to strengthen management and disclose relevant information in the ESG report.
	This report is our sixth issue of ESG report. We will review whether or not material topics

need to be adjusted on an annual basis.