Sustainable Supply Chain Management

HIWIN’s Supply Chain

HIWIN is a global corporation that is dedicated to not just competitive manufacturing, research, and development, but also sustainable procurement. HIWIN’s upstream partners include raw material suppliers, ODMs, and contractors. As HIWIN’s operations continue to grow, so have their sales as they follow the steps of globalization and become connected with the world.

In pursuit of sustainable corporate operations, HIWIN works closely with suppliers to ensure mutual growth. We also ask our suppliers to comply with sustainable development norms, such as green products, conflict minerals, and integrity management as part of our efforts to facilitate mutual prosperity across our value chain. We hope that our suppliers can share our ideals and standards when it comes to sustainable development.

Sustainable Supply Chain Commitment

In addition to supplying high-tech, highquality, and high-value products, HIWIN also upholds the belief that “Manufacturing is not a goal, but a means to satisfy human needs.” To such ends, we are dedicated to providing diverse and customized services. HIWIN not only regulates Company employees but also encourages our upstream and downstream suppliers to provide high-quality products, accurate lead times, and carry out sustainable development. We expect our suppliers to comply with laws and regulations for labor conditions, avoid the use of conflict minerals, ban any hazardous materials, and perform financial evaluations. For equipment suppliers, we have introduced a term in purchasing contracts requiring suppliers to comply with labor rights and human rights. The additional term can prevent and reduce any damages and risks to HIWIN’s overall operations, safeguard stakeholder interests, and provide a better working environment, which thereby enhances both parties’ competitiveness.

Supply Chain Risk Management

HIWIN conducts annual supplier risk assessments to protect the Company’s production and shipments from any unexpected supplier collapses, which may lead to further disputes. We also keep a close eye on supplier risk levels and regularly survey labor rights, use of child labor, forced or compulsory labor, financial situations, freedom of association, collective negotiation rights, and use of conflict minerals to comprehensively evaluate our supplier’s adaptability. When deemed necessary, HIWIN will also offer assistance to suppliers.

To ensure uninterrupted operations, HIWIN asks suppliers to formulate response plans and processes for any potential risks, natural or artificial, that may result in damages to their production. Through reasonable preventive measures, we hope to avoid and reduce damages to HIWIN’s operations and safeguard stakeholder interests. When suppliers are found to have caused a negative impact on the environment, we will choose to terminate trading, observe overall impacts, and evaluate our business relationship. In 2021, the COVID-19 pandemic resulted in longer shipping schedules and a labor shortage. The resulting mismatch between supply and demand caused the price of raw materials to rise. To fulfill HIWIN demands, we are currently in close communications with suppliers and have placed pre-orders that will then be fulfilled in batches.

Supply Chain Management

HIWIN considers suppliers as long-term partners. We work closely with suppliers in our operations to pursue sustainable corporate operations and growth, but also to enhance and coach suppliers in product quality and environmental protection.

1. Supplier evaluation

   HIWIN has developed a supplier evaluation system to support sustainable operations and development. All HIWIN suppliers must first pass our evaluations to become eligible suppliers.

   
2. Vendor safety, health, and environmental protection agreements & management

   HIWIN has always strived to provide a healthy, safe, and comfortable working environment. We also hope that our upstream and downstream suppliers can work with us to establish an industry benchmark for health, safety, and environmental protection standards. To ensure the safety and health of vendors and employees as well as facility maintenance, we have formulated a measure to manage vendor safety, health, and environmental protection agreements. A total of 231 suppliers have joined the program as we continue to roll it out to all suppliers. When deemed necessary, HIWIN will offer assistance to suppliers and collaborate to minimize the risks of hazards.

Local Sourcing

HIWIN prioritizes suppliers that produce locally to ensure flexible supplies and rapid response, but also to accelerate production efficiency and support the local economy by creating new job opportunities and developing local areas.

Dimensions Evaluated in the Supplier Self-evaluation Form

Conflict Minerals

HIWIN recognizes that conflict mineral is a topic of great concern to many industries. To understand whether the raw materials we use are sourced from conflict areas, HIWIN continues to prohibit the use of conflict minerals in our suppliers as a way to help suppliers understand material issues such as ethics and human rights and ask suppliers to fulfill their social responsibilities.

Restricted Hazardous Substances

HIWIN products are sold globally. To ensure HIWIN products comply with customer demands and international regulations (e.g. EU’s RoHS), we ask raw material suppliers to provide evidence and information guaranteeing that they do not use any restricted substances that are hazardous to the environment. HIWIN also conducts random audits and asks suppliers to provide explanations and mitigation measures when we uncover any use of restricted hazardous substances.

Human Rights & Labor in the Supply Chain

HIWIN issues a Supplier Management Labor Survey annually to assess human rights and labor conditions in our top 100 suppliers. All surveyed suppliers passed the evaluation and we will continue to hold surveys annually and ask suppliers to comply with government regulations.

Green Procurement

HIWIN is dedicated to applying ESG concepts to management philosophies, striving to promote our beliefs in valuing resources and environmental sustainability through green procurement. We invested NT$1.167 million in green procurements in 2020 and NT$113.964 million in 2021.