Responsible Supply Chain

Management Approach of a Sustainable Supply Chain

Accton adheres to the Responsible Business Alliance (RBA) Code of Conduct, supplemented by international standards such as the UN Guiding Principles on Business and Human Rights, the International Labour Organization (ILO) Declaration on Fundamental Principles and Rights at Work, the Universal Declaration of Human Rights, and other relevant human rights frameworks including those related to the Xinjiang region.

We require all suppliers to align their business practices with these standards—covering areas such as labor rights, health and safety, environmental protection, business ethics, and management systems—and to sign a Supplier Commitment Letter. Suppliers must also comply with all applicable laws and regulations in the countries or regions where they operate. Furthermore, we require first-tier suppliers to cascade these standards and expectations to their sub-tier suppliers.

1. Enhance Cost Leadership Capability: Integrate Group resources and engage in strategic collaborations to achieve the most competitive supply chain value.

2. Establish Sustainable Supply Chain Capability: Drive suppliers to enhance performance in economic, social, and environmental aspects, fostering their sustainable development.

3. Strengthen Supply Chain Supply Capacity: Continuously support suppliers in diversifying their supply sources and enhancing their local supply capabilities.

4. Build a Green Supply Chain: Promote the transition of suppliers from implementing energy-saving and carbon reduction measures to adopting a circular economy.

5. Prioritize the Environment: Proactively implement green procurement, striving for economic benefits while ensuring environmental friendliness.

6. Non-Compromise on Conflict Minerals: Ensure that products and the supply chain are free from conflict minerals.

7. Implement Sustainable Risk Management: Focus on suppliers’ energy resource usage and resource management to respond to the impact of extreme climate change on the supply chain.

8. Focus on Environmental Issues: Enhance waste resource reutilization efforts and commit to reducing environmental pollution impacts.

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Supplier “Human Rights, Environment, Safety, Health, and Management System” Audit Enhancement Plan

Accton has integrated the “RBA Code of Conduct” into its supply chain to monitor the implementation of labor rights, health and safety, environmental protection, business ethics, and management systems by suppliers. The Company encourages suppliers to develop materials and processes that reduce environmental impact or achieve energy saving and carbon reduction through process utilities. Environmental issues, including climate change and biodiversity, are given increased attention and management.

To this end, over the years, we have harmonized Accton’s supplier audit forms based on RBA requirements, conducting reviews and evaluations of suppliers on corporate social responsibility and ESG sustainability aspects. This audit tool includes stricter scoring methods and more rigorous requirements than in the past.

From 2021 to 2024, our objective was to conduct surveys on the RBA Code of Conduct for the top 200 production raw material suppliers by transaction value (i.e., key suppliers). The number of suppliers completing the survey during this period were as follows: 72 suppliers in 2021, increasing to 116 suppliers in 2022, 153 suppliers in 2023, and reaching 105 in 2024.

ISO 20400: Sustainable Procurement – Guidance

Risk Assessment Process

Accton regards supply chain risk management as a key component of its competitive advantage. Within the industry Accton operates, common risk factors can be briefly categorized across economic, environmental, and social dimensions based on industry characteristics.

Launch of the Zero Carbon Chain Project

On April 21, 2023, Accton held a supplier sharing conference for the Zero Carbon Chain Project, specifically choosing the day before Earth Day to emphasize the importance of this initiative. The theme of the conference was “Zero Carbon Chain,” aimed at building consensus with supplier partners to jointly develop ESG sustainability and carbon reduction action plans. The event underscored the significance of future carbon reduction and ESG sustainability actions in Accton’s overall supply chain management.

Carbon Reduction Goals

Accton aims to reduce carbon emissions by 50% by 2030 through internal process optimization and product design. In collaboration with supply chain partners, the Zero Carbon Chain Project will be pragmatically advanced, working towards the goal of net zero carbon emissions by 2050. A critical strategy for 2026 includes joint decarbonization growth with upstream and downstream partners.

In September 2023, Accton, in collaboration with 10 supply chain partners, received the “Low Carbon and Smart Manufacturing Upgrade Transformation Subsidy Program” from the Ministry of Economic Affairs Industrial Development Bureau. This initiative, following the “Supply Chain One Leading Ten” model, collectively works towards achieving energy-saving and carbon reduction goals. This Project Has Established Three Major Goals:

  • Accton aims to achieve a relative reduction of 20% in carbon emissions while expanding its production capacity.
  • Precise carbon footprint calculations, including calculating the carbon footprint from raw material processing by collaborative manufacturers to in-factory processes. This is to prepare for potential future carbon tariff reporting requirements for product exports.
  • Suppliers are encouraged to adopt carbon emissions reduction measures and to amplify these effects further.

◆ Accton Academy of Sustainability held four joint meetings on March 26, May 29, August 22, and October 22, providing a platform for participating suppliers to exchange knowledge and share outcomes related to carbon reduction initiatives.

◆ In April, Accton initiated ISO 20400 Sustainable Procurement – Guidance. Relevant departments jointly reviewed compliance with sustainable procurement principles and requirements. Process and documentation improvements are underway, with certification targeted for completion in 2025.

◆ Assisted 2 supplier partners in acquiring equipment to optimize processes, improve yield, and reduce waste generation, achieving the set carbon reduction targets.

◆ Assisted and guided two suppliers in obtaining ISO 14064 certification.

◆ Accton provided energy monitoring equipment and systems to 9 suppliers, visualizing energy consumption data of high-energy equipment and consolidating it into a cloud system for easy adjustment of energy-saving solutions.

  • Process Electricity Carbon Reduction Management: Accton will first introduce a real-time electricity information monitoring system and use data management to adjust production schedules, ultimately achieving continuous optimization of low-carbon production lines.
  • Upstream and Downstream Collaboration on Product Carbon Footprint: Initially, reduce energy consumption during the product testing phase for downstream customers. Establish a carbon footprint management platform and collaborate with upstream suppliers on carbon reduction projects to achieve estimated carbon reductions. The carbon footprint management platform aims to introduce a carbon pricing management mechanism in future procurement.
  • Continued Expansion of Impactful Carbon Reduction Initiatives: Implement Accton’s sustainable supply chain management mechanism, aiming to obtain ISO 20400 Sustainable Procurement Guidelines certification. Share various carbon reduction experiences with partners in the Zero Carbon Chain Project. Continue offering Accton’s sustainability courses, inviting suppliers to participate and actively promoting energy-saving and carbon reduction concepts and practical methods to expand sustainable impact.

Environmental Management

Accton Group is committed to implementing Hazardous Substance Free (HSF) management. Our Accton Zhubei AI Park, Hsinchu Science Park, Zhunan Plant in Taiwan and Vietnam Accton have all continuously passed the annual certification of the IECQ QC 080000 system. All products comply with international environmental regulations (e.g., EU RoHS, REACH directives), aiming to achieve the goal of using environmentally friendly materials through green supply chain management. This allows Accton to produce and provide customers with low-pollution green products that reduce associated harm to humans and the environment.

Conflict Minerals

Respecting international human rights and corporate social responsibility, Accton Group avoids using minerals from areas affected by armed conflict and human rights abuses. Through regular due diligence as part of the Responsible Minerals Initiative (RMI), suppliers are required to source raw materials that do not originate from Conflict-Affected and High- Risk Areas (CAHRAs). This is to prevent indirect human rights violations and ensure compliance with national and international laws.