table of contents - yageo · table of contents overview 03 1. message from the chairman 04 2....
Post on 20-Jul-2018
219 Views
Preview:
TRANSCRIPT
2
TABLE OF CONTENTS
OVERVIEW 03
1. MESSAGE FROM THE CHAIRMAN 04
2. CORPORATE PROFILE 05
2.1 An Introduction to Yageo 05
2.2 Business Summary 06
2.3 Financial Highlights 07
2.4 Corporate Governance 08
2.5 Stakeholder Identification and Communication 12
2.6 Investor Engagement 13
2.7 Corporate Security and Risk Control 14
2.8 Awards Received in the Reporting Period 16
3. EMPLOYMENT 17
3.1 Employment 17
3.2 Employee Development 20
3.3 Compensation and Benefits 20
3.4 Employee Relations 21
3.5 Work and Life Balance Program 21
3.6 Safety and Health 22
4. CUSTOMER SERVICE & SUPPLIER MANAGEMENT 23
4.1 Customer Service and Satisfaction 23
4.2 Supply Chain Risk Management 24
4.3 Helping Suppliers Improve Delivery and Quality 25
4.4 Ensuring Supplier Compliance 25
5. ENVIRONMENTAL PROTECTION 27
5.1 Green Management Organization and System 28
5.2 Declaration of Metal Conflict Free 30
5.3 Environmental Compliance Record 30
APPENDIX 32
GRI G4 Guidelines Content Index 32
3
ABOUT THIS REPORT
Yageo have always fully devoted ourselves to the corporate social responsibilities, in order to be a
good corporate citizen. We continue to strengthen the ties with our employees and suppliers,
enhance corporate governance, business ethics, maximize social contribution, and environmental
protection. We provide a clean & healthy living environment to the society to show our care for the
earth and the next generation. Yageo’s business and our commitment to sustainable growth are
depending on these cornerstones.
Report Scope
This report contains information related to all Yageo offices & factories located in Taiwan (Taipei
and Kaohsiung), as well as our wholly-owned subsidiaries, Yageo (China) – Dongguan and Suzhou.
Financial figures in this report are expressed in New Taiwan Dollars unless otherwise specified.
This report is published in English and is available on Yageo’s corporate website.
Reporting Period
We publish the Social Responsibility Report on an annual basis, and the previous report was
published in June 2016. This CSR report describes performance data from January 1, 2016 to
December 31, 2016.
Reporting Criteria
This CSR report has been compiled in accordance with the Core option of
the Global Reporting Initiative (GRI) G4 guidelines for disclosing
CSR-related strategies, concepts, measures, and performance. Compared
with Yageo’s 2015 CSR report, this report does not revise misleading data
from previous reports.
4
1. MESSAGE FROM THE CHAIRMAN
As an industrial leader, Yageo’s core value is a constant focus on achieving higher levels of
operational, environmental and safety performance. We spare no efforts to maintain a strong,
healthy workforce, operate safely and responsibly, and deal ethically with our stakeholders,
partners and the public. Our objective is to create sustainable value for our employees,
shareholders, suppliers, business partners and the communities.
We are dedicated to preserving a green globe and minimizing environmental impacts by reducing,
reusing, and recycling materials used in our manufacturing processes.
Yageo’s Social Responsibility Statement is as following:
To ensure labor's obligations and rights, Yageo draws up regulations and system according
to Labor Standards Act
Yageo fully complies with "Gender Equality in Employment Law" and labor related
applicable obligations in Labor Standards Act. Yageo prohibits sex, race, religious belief,
age, marital status, disability, and nationality discrimination
According to company employment policy, Yageo does not engage in child labor, employ
anyone below 16 years of age and avoids enforced labor
Yageo respects the human rights, complies with "Gender Equality in Employment Law" and
takes steps to avoid issues of sexual harassment
Yageo is devoted to environmental protection. Our environmental policies are :
- To implement pollution prevention by complying with legal requirements
- The reduction and disuse of prohibited materials, resource recycling
- Strive for sustainable business development and continue environmental improvements
- To establish/ implement an environmental management system to provide a safe and
healthy working environment for employees
We firmly believe that Yageo's vision and competitive edge in environmental conservation and
workforce protection will create corporate and product value, drive a sustainable growth and benefit
all of our stakeholders. We will continue to fulfill our social responsibilities for a better tomorrow.
5
2. CORPORATE PROFILE
Yageo is the world’s leading passive component service provider, providing the industry’s leading
process technologies and the comprehensive product portfolio. Yageo’s leading industry position is
based on a combination of key differentiating strengths: technology leadership, manufacturing
excellence, and customer partnership.
2.1 An Introduction to Yageo
Founded in 1977 and headquartered in Taipei, Taiwan, the Yageo Corporation has become a
world-class provider of passive components services with capabilities on a global scale, including
production and sales facilities in Asia, Europe and the Americas. The corporation provides
one-stop-shopping, offering its complete product portfolio of resistors, capacitors and wireless
components in both commodity and specialty versions to meet the diverse requirements of
customers.
Yageo currently ranks as the world No.1 in chip-resistors, and No. 3 in MLCCs, with 28
sales/service offices in 18 countries, 9 production sites, 8 JIT logistic hubs and 2 R&D centers
worldwide.
Yageo’s broad product offerings are targeting at key vertical markets, including applications for
mobile, tablet PC, industrial/power, alternative energy, medical and automotive. We serve
diversified leading global customers, such as EMS, ODM, OEM and distributors.
MilanItaly
MoscowRussia
RoermondBenelux
TaipeiTaiwan
SeongnamKorea
SuzhouChina
DongguanChina
TokyoJapan
KaohsiungTaiwan
MunichGermany
SkierniewicePoland
SzombathelyHungaryGuadalajara
Spain
TrajoucePortugal
San JoseUSA
GuadalajaraMexico
Singapore
Malaysia
ShanghaiChina
DallasUSA
DetroitUSA
AtlantaUSA
MinnesotaUSA
HamburgGermany
ChicagoUSA
Montréal Canada
BostonUSA
LondonUK
6
Table 1 Yageo products’ sales performance in 2016
Proportion 2016
Main products Unit of total sales (NT$1,000) %
MLCC 12,557,333 42.4
Chip Resistor 11,876,157 40.1
Wireless Component 444,245 1.5
Leaded Resistor 977,340 3.3
Ferrites 1,925,063 6.5
Others 1,836,214 6.2
Total 29,616,351 100
The market brands carried including : Yageo, Phycomp, and Vitrohm. The company is listed on the
Taiwan Stock Exchange since October 1993, and GDR listing on the LUX since September 1994.
2.1.1 Membership in Industry Association
As a leader of passive component supplier, Yageo actively participated in trade and industry
associations. Yageo is the member of ECIA (Electronic Components Industry Association). As an
organization made up of the leading electronic component manufacturers, their manufacturer
representatives and authorized distributors, ECIA members share a common goal of promoting and
improving the business environment for the authorized sale of electronic components to the end
customer. In doing so, we contribute to making the Americas region more competitive in the design
and production of electronic goods.
Since automotive grade chip resistors and MLCCs are our product development focus in recent
years, Yageo also joined AEC as a member and participate the technical seminars on a regular
basis. The Automotive Electronics Council (AEC) is an organization based in the United States that
sets qualification standards for the supply of components in the automotive electronics industry.
AEC was formed in 1993 by Chrysler, Ford Motor, Delco Electronics. AEC developed several
notable specifications for automotive electronics
2.2 Business Summary
Yageo made fundamental transformation throughout
the organization in the past few years. As we continue
into 2017, we're excited by the incredible
opportunities ahead. Yageo will continue to create
7
value for shareholders, customers and employees by the following main strategies:
Expand the niche market share: continue to optimize the product mix, strengthen the
partnership with large customer, increase the sales portion of high contribution products and
customers; focus on the application areas of high prices and high margins, expand
automotive electronics, industrial products, power supplies, Internet of Things, VR / AR
innovation and technology, and enhance the market share of Europe and the United States
market.
Implement excellent operations: provide total solutions and integrated services, offer a
comprehensive product portfolio to meet customers "one-stop-shopping service"; provide the
best quality global logistics services with high efficiency automated logistics and warehousing
management platform; continuous integration of the business units and global sales network
resources, update the system and operating processes in a timely matter.
Develop the quality and innovative products: based on the existing products and technology,
continue to invest in adjacent technology high-end product development, introduce high-value
new component categories, solid execution of new product development and go-to-market
plan. Improve quality management processes, provide high quality and comprehensive
product line to meet the needs of all types of customers
Progress toward a high performance organization: a clear division of functions, and foster
professional successors, attract and retain talents, continuously construct a high-performance
organization through the organizational and process innovation.
Yageo will continue improving the fundamentals, offering product portfolio with a holistic launch to
be impactful to the market. We will leverage our leading position in Greater China home market,
further penetrate Europe and N. America with the in-depth segmentation strategy backed with R&D
resources.
2.3 Financial Highlights
Yageo achieved USD916 million revenue (NT$29.6 billion) in 2016, a 7.6% increase compared to
the previous year. Breakdown by product, MLCC and R-Chip account for 42% and 40%,
respectively, by region, China is our largest contribution which accounts for 73% of total revenue.
However, the efforts of AVL at customer’s HQ in Europe, N. America, Japan and Korea also cannot
be ignored.
8
Table 2 Yageo Corporation’s financial performance for 2016 and 2015 (Unit: NT$1,000)
Item 2016 2015
Financial revenue/expenditure
Business revenue $29,616,351 $27,512,865
Operating costs 22,357,997 20,973,877
Gross profit 7,258,354 6,538,988
Net income before tax 4,975,284 4,563,375
Income tax 969,584 891,310
Net profit 4,005,700 3,672,065
Profitability Net profit per share 6.83 5.48
2.4 Corporate Governance
Yageo Corporation is firmly convinced that a sound corporate governance practice is the
cornerstone of the company. By holding on to the highest standard of corporate transparency and
integrity, Yageo has benefited from effective risk management, efficient organizational functioning,
and greater investor confidence and increased market attractiveness in recent years even though
the stock market is bearish and the economy is in a slump.
Reinforcing the framework of corporate governance has proven to be as essential to the end results
as an appropriate business model in Yageo's seeking to
become the world's finest passive component services
provider.
As a principle, Yageo maintains strict reporting
requirements across its global organization. In addition to
publishing monthly sales information via the press and on
Yageo website, Yageo also holds the annual general meeting and one-on-one investor meetings to
keep the investor communities informed in un-prejudiced, consistent and timely manner.
9
2.4.1 Company Structure
Graphic 1. Organization chart
2.4.2 Board of Directors
Yageo’s Board of Directors consists of nine renowned members with a diverse experience and
knowledge, they are world-class business leaders or scholars. Under Chairman Pierre TM Chen’s
leadership, Yageo’s Board of Directors takes a straightforward and serious approach to its duties
and is a proficient and independent Board.
The primary responsibilities of the Board of Directors are supervision, counseling and direction to
the management of the Company. They also provide guidance to the management team of the
Company. The Board’s detailed responsibilities include, but are not limited to, the following:
1. Composing the business plan;
2. Proposing earnings distribution plan or plan for making up the losses;
3. Proposing plan for capital increase or decrease;
4. Approving important corporate policies and contracts;
5. Electing and terminating the President and Managers of the Company;
6. Establishing and withdrawing the branch offices;
7. Approving the budget and financial accounts;
8. All matters shall be decided by resolutions of the board of directors, unless the Law or
Memorandum of Incorporation provide certain matters shall be resolved at the Shareholders
Meeting.
10
Table 3 Yageo Directors, Supervisors
Title Name Experience Education
Chairman Pierre T.M. Chen Chairman, Chilisin Electronics Corp.
BS, Engineering, National Cheng
Kung University
Chairman, Teapo Electronics Corp.
CEO &
Director Dora C. W. Chang
Chief Financial Officer, Advantech Co., Ltd. MBA, Finance, UCLA Anderson
School
VP Finance, Procter & Gamble, Greater
China
Independent
Director Jerry Lee Chairman, Teapo Electronic Corp.
BA in Accounting, Tam-Kang
University
Independent
Director Hilo Chen Founder & Chairman, GuoShi Partners Co. EMBA, National Taiwan University
Director Shih-Chien Yang Chairman and CEO, Global Strategic
Investment Fund
Ph.D., Electrical Engineering,
Northwestern University
Director Bob P.Y. Wang Chairman, Kuo-E Corp.
BS, Electrical Engineering and
Microelectronics, National Cheng
Kung University
Director Tzong-Yeong Lin Director, Kuo Shin Investment Ltd Master of Law, National Taiwan
University
Director Victor C. Wang Chairman, VW & Co, CPA EMBA, National Taiwan University
Supervisor Yuan-Ho Lai Director of the Board, Chilisin Electronics
Corp. LL.M. & LL.D. from Kobe U., Japan
Supervisor Lawrence Lai-Fu Lin Independent Director, O2Micro International
Limited
Meetings of the Board of Directors
1. Chairman of the Board
The Board of Directors shall appoint a Chairman to represent the Company and a Vice Chairman
from among the board members. In the case the Chairman is on leave or unable to perform his or
her duty, the Vice Chairman shall take the place of the Chairman. In the case the Vice Chairman is
also on leave or unable to perform his or her duty, the Chairman shall designate one of the board
members to take his or her place. If the Chairman fails to make designation, the board members
shall appoint a member among themselves to take the place of the Chairman.
2. Frequency of Meetings
The regular meetings are held per quarter and shall give 7-day notice to Directors and Supervisors
before the meeting. In the case of emergency, the meeting may be convened at any time.
11
2.4.3 Compensation Committee
Other than improving corporate governance, strengthening the compensation management power
of the Board, and assessing and determining the compensation for directors, supervisors, and
managers, the Compensation Committee must also assist Yageo with project consultation and
training of senior-level managers.
Roles & Responsibilities
Define the policies, systems, standards, structures related to the performance and compensation of
directors, supervisors, and managers.
Compensation and Selection
The Compensation Committee members are appointed by the Board of Directors, which include
two independent directors and an external advisor, with one of the convener. In 2016, the
Compensation Committee convened two meetings, with an attendance rate of 100%. All members
of the Compensation Committee must abide by independent and professional specifications and
regulations; the term of office for committee members is the same as that for the Board of Directors.
2.4.4 Internal Audit System
The purpose of internal auditing is to monitor and evaluate the efficiency and implementation of our
internal control system. Yageo requires all auditing personnel to maintain an independent and
objective attitude when reviewing the main operation areas and relevant regulations to assist the
board and management in achieving the company’s revenue, performance, and asset protection
goals, and reasonably guarantee the reliability of financial reports and regulatory compliance.
Under the leadership of the Board of Directors and Audit Committee, Yageo’s internal audit process
is aimed at thoroughly examining the company’s operations and identifying improvement
opportunities. The auditing unit conducts audits according to the findings of previous operation
audits, risk assessments, and key project initiatives relating to the company’s operating strategy.
Thematic audits based on various real-work functions are also conducted by using a specific
indicator to compare the performance of all global units, or conducting a thorough audit of
operations for specific area or department. The ultimate goal is to establish solid operating
strategies that build a strong foundation for long-term corporate development. .
2.4.5 Corporate Compliance
The EICC Code of Conduct was established to ensure worker safety and fairness, environmental
responsibility, and business efficiency. Yageo adopts the EICC Code of Conduct, has created a
manual to manage, efficiently implement, the promotion of EICC and to protect human rights and
social aspects.
12
EICC (Electronic Industry Citizenship Coalition) Code of Conduct:
Prevention of occupational injury and illness.
A commitment to uphold the human rights of employees, and to treat them with dignity and
respect.
Obey environmental laws and regulations.
Conduct business operations with reference to ethics.
Protect intellectual property
Emphasize continuous improvement
Yageo’s management team closely scrutinizes both domestic and foreign government policies and
regulatory developments that could have a potential impact on Yageo’s business and financial
operations; we have established related risk management procedures. As of today, Yageo has
never been subject to any material monetary fines and/or non-monetary sanctions for
non-compliance with any regulations and statutory laws.
2.5 Stakeholder Identification and Communication
Yageo has established a core team to lead corporate social responsibility activities, including
representatives from Investors & Public Relations, Human Resources and Corporate Marketing.
The core team identifies stakeholders and integrates stakeholders’ concerns into annual plans and
routine tasks, also keeps flexibility to incorporate ad-hoc issues into annual plans.
The core team also quests support from other departments if necessary.
Yageo stakeholders include employees, suppliers, customers/partners, investors and stockholders,
government, and the community. Yageo assumes certain responsibilities to its stakeholders and
needs to regularly communicate with them through different measures and channels to understand
their needs and expectations from Yageo. We also take these needs and expectations into
consideration for corporate social responsibility policy and projects.
13
Table 4 Yageo stakeholder key concerns and communication channels
Stakeholder Key Concern Communication Channel Frequency
Company policies, strategies Investor conference Annual
Corporate governance Board of directors meeting Quarterly
Risk management Market observation post system Ad-Hoc
Economic/financial performanceFinancial reports QuarterlyCompliance with product-related laws and regulations Key account QBR review meetingQuarterly
New products/applicationinformation Interactive seminars Semi-annual
Pricing, capacity International and domestic exhibitionAd-Hoc
Factory audit Ad-Hoc
Procurement practice Audit and evaluation Annual
Supplier management & evaluationBusiness meeting Ad-Hoc
Labor relations & employee welfareEmployee welfare committee Ad-Hoc
Training & development Training Ad-Hoc
Health & safety Employee portal Ad-Hoc
Company policies, strategies Bulletineboard Ad-Hoc
Strategic sales & marketing meetingSemi-annual
Employee complaint mailbox Ad-Hoc
Laws & regulations compliance EHS compliance evaluation Semi-annual
Labor relations Public announcement Ad-Hoc
Media Economic/financial performanceRevenue announcement Ad-Hoc
Society/Community Industry/market trends Industrial membership Ad-Hoc
Investors/Shareholders
Customers
Suppliers
Employees
Government/Institution
2.6 Investor Engagement
The objective of Yageo’s business strategies and financial
policies is to support and enhance the value of our long-term
shareholders. In addition to align ourselves with international
standards that demonstrate our reputation and position as a
premier investment and sustainability leader, we are also highly
ranked within the passive component industry. Since public
listed in TSE in 1993, we have consistently delivered value to
shareholders through cash dividends, maintaining a solid
financial status, and keeping high credit ratings among
technology companies.
Yageo has established an effective communication system to distribute information to better serve
investors and the investment community. Each quarter, our Investors & Public Relations
Department reports and publishes company performance to the investors. Yageo Investors &
14
Public Relations team holds investor and analyst meetings on a regular basis. All these efforts
emphasize on serving investors with timely, accurate and transparent information regarding Yageo
business, operations and performance. In addition, information regarding Yageo’s business
performance and Material information released on TSE Market Observation Post System is posted
on Yageo’s corporate website in a timely manner.
2.7 Corporate Security and Risk Control
Yageo is committed to create a safe working environment and protect proprietary information.
Therefore, in order to safeguard the interests of the Company, customers, employees and
shareholders, Yageo is dedicated to physical security, employee security, and vendor security.
Yageo takes effective risk management to avoid possible security incident.
2.7.1 Risk Management Policy
Purpose
Risk management relates to the culture, processes and structures directed towards the effective
management of potential opportunities and adverse effects within Yageo’s corporate environment.
The purpose of this policy is to describe the corporation's fundamental approach to risk and risk
management. It provides guidelines and information on how Yageo Corporation manages risks.
Organizational Scope
Risk management is a corporate-wide policy. A systematic application of management policies,
procedures and practices and also include a clear understanding of roles and responsibilities will
lead to an effective risk management.
2.7.2 Risk Assessment & Effect Analysis
Yageo has incorporated risk management into its daily operations, and regularly implement risk
reduction strategies. Yageo’s risk response strategy includes preventive implementations,
adjustments, corrective measures and monitoring.
15
Table 5 Yageo’s risk response strategies for ensuring business continuity
2.7.3 Contingency Response Plan
Purpose
The purpose of this Contingency Response Plan (the “Plan) is to sketch the standard procedures
for Yageo employees to follow when disasters occur at its manufacturing plants.
Scope
This Contingency Response Plan provides action plans which include:
1) The preparation work for disaster prevention.
2) Standard Operating Procedures for responding to various disasters.
Disasters 1) Fire Accident (Emergency Incident).
2) Natural Disasters (Typhoon, Earthquake or
Flood)
3) Explosion
4) Accidents That Cause Major Environmental
Impact
5) Chemical Spills
Potential Risk Potential Effect Possible Causes Preventive Meaures Corrective Measures Person incharge
1Equipment failure/interruption
Product output andgoods delivery
1. Lack of spareparts/machine 2.Equipment aging
Prepare backup/spareparts/machines
1. Establish regularmaintenanceplan/resource2. Regularreplacement
R+M
2Raw materialshortage Capacity and delivery Insufficent stock
1. Regular stockreview and prevention2. Deveop secondsource
Set safety stock levelWarehouse,Procurement
3 Water outageEquipment andproduction
Natural disaster,water companysystem failure
Keep contact withwater company
Prepare waterreservation tanks Factory
4 Power outageEquipment andproduction
1. Natural disaster2. Power companymalfunction
Keep contact withpower company UPS IE
5 Labor shortage
1. Insufficientproduction output2. Delivery delay3. product quality
Insufficent training,high turnover rate
Employee care andcommunication
1. Provide training2. Employee retention3. Offer competitivepackage
HR
6 Customer payment Payment delay
1. Sales people'snegligence2. Customer'seconomic/creditissue
Regular review
1. Regular customervis it2. Monthlyreconciliation withcustomer
Sales
16
6) Utility Outage (Ex: Power and water)
7) All other possible accidents
2.8 Awards Received in the Reporting Period
2016 Supplier Excellence Award from TTI (North America, and Asia)
Yageo is honored to receive the Supplier Excellence Award (SEA) Bronze Level in both N.
America and Asia from TTI, Inc. an authorized, specialty distributor of interconnect, passive, and
electromechanical (IP&E) components. Winning this award means that Yageo has been
acknowledged for consecutive 2 years as an outstanding performance on all quality
measurements. TTI created its SEA program to uphold supplier quality at all levels, including
receiving, customer-reported and administrative quality, and on-time delivery supported by reliable
operations and business systems.
17
3. EMPLOYMENT
People are one of the most valuable assets
to support Yageo’s business success.
Yageo’s True Colors Every employee in the organization is
expected to adhere to Yageo’s True Colors
- our core values of Speed, Innovation,
Efficiency and Flexibility. These values are
also the basis on which we build the trust
and integrity that will allow our business to
continue to succeed.
3.1 Employment
Yageo’s principles of human resource planning to ensure resources are available to meet current
and future business needs, which are described as below:
Organization planning and headcount budgeting according to business plan and strategies.
Develop various recruiting channels such as job banks, internal referral, outsourcing
agents, campus recruiting.
Prepare 5~10% extra workforce as backup manpower.
Provide training to upgrade workforce capability.
18
Yageo’s goals and practices for realizing the core values are summarized as below: Table 6. Yageo’s social management goals and practices
Corresponding Issues/Items Practices
Human rights
Prohibits the use of child labor and forced labor; ensuresequal employment opportunities; no human rights complaintcases reported; and all employee jobs are protected underthe Labor Safety Act, which ensures reinstatement afterparental leave
Employer/employeecommunications
Labor meetings, departmental meetings, seminars,suggestion box, Employee portal, bulletine board
Compensation and benefits
Adheres to the minimum base salary specified in the LaborStandards Act, provides various insurance benefits,contributes to a pension fund, and conducts periodicperformance appraisals.
Occupational health and safety
Holds relevant certification for occipational health and safety,and management systems; the porportion of laborrepresentatives in the Environmental Safety Committeeconforms to the basic requirements of Labor Safety Act; andminimizes occupational injuries by providing annualemployee health examinations (as mandated by the LaborStandards Act)
Employee code of conduct
prohibits unethical business practices and insider trading;complies with employee labor and environmental regulations;conducts self-examinations according to the ElectronicIndustry Code of Conduct (EICC); and ensures that allemployees refuse bribes and follow equal labor rightrequirements
A harmonious work place Maintain an employee cafeteria and employee parking lot
Learn Training and development Training seminars, sales & marketing workshop
Employee relations Spring wine party
The welfare committee Sports club, travel allowance, gift vouchers, movie tickets
Social welfare Donation
Work
Happy life
3.1.1 Yageo Workforce Structure
At the end of 2016, Yageo had 10,096 employees worldwide, including 7,575 production operators
and 2,521 indirect labor (factory, centralized infrastructure, sales & marketing, and logistics).
Regardless of gender, religion, race, nationality or political affiliation, Yageo has well defined the
employment policy for hiring - based on their job qualifications and company requirements. We also
have procedures in place to ensure an equal treatment for all candidates and employees in
recruitment, development, and evaluation.
19
Table 7. Employee distribution
Year 2016 2015
number of
employees
Direct labor 7,575 7,824
Indirect labor 2,521 2,475
Total 10,096 10,299
Average age 33 32
Average year of service 4.86 4.63
Education
background
PhD 21 16
Master 238 212
University 2,502 2,340
High School 5,642 5,807
Under high school 1,693 1,924
3.1.2 Employee Retention
Yageo’s encourages work-life balance, enhancing managers’ capabilities, and providing career
development opportunities to keep and attractive talented employees. The average annual turnover
rate of the past three years has been less than 10%.
Table 8. Employee attrition rate
3.1.3 Recruitment
Hiring managers are required to prepare job description of the vacancy before recruiting. Yageo
recruits employees through an assessment and selection process according to qualifications
defined. We prohibit sex, race, religious belief, age, marital status, disability, and nationality
discrimination in hiring.
Yageo prepares employment contract which includes all terms of wages, benefits, working hours,
exit procedure, contract termination, information security, intellectual property… etc., The contract
shall be signed by the candidate prior to his/her employment day.
Location Monthly Attrition Rate
OP Non-OP
Taiwan 3.36% 1.31%
China 11.25% 2.3%
20
3.1.4 Abolition of Child Labor
Taiwan’s “Labor Standard Law” states that no workers below the age of 15 shall be employed, and
that children between the age of 15 and 18 are not permitted to perform heavy or hazardous work.
To comply with the law, Yageo never hires employees less than 16 years old, we also conduct age
verification in recruitment process to avoid hiring underage labors.
3.1.5 Performance Measurement
The objective of Yageo’s performance measurement system is to improve the performance of
individual employees and the organization as a whole. The key evaluation criteria include:
leadership, initiatives & follow through, problem solving, teamwork, strategy executions,
communication and organization building.
3.2 Employee Development
We train workers to industry standards, and invest in the local workforce. Continuous learning is
especially important for company success in the sluggish economic situation. Yageo provides
comprehensive learning opportunities and resources to all employees and a tailor-made individual
development plan to the employee’s development needs, also with business needs. Training days
for each indirect labor received in average is 6 days, and 42 days for each direct labor.
Development and Training Programs
Yageo not only employs talented people, but is
also focusing its energies on enhancing the
leadership and capabilities of its staff. Yageo
offers opportunities for people to grow both
professionally and personally by adding value
to the organization, improving their leadership
skills and work capabilities through our
management training programs by external professional institution, which including:
Problem analysis and solving
Negotiation skills
7 habits of highly effective people
3.3 Compensation and Benefits
Yageo place employee’s benefits in high priority, employees are entitled to a comprehensive
compensation and benefits package above the industry average. Based on salary changes in the
industry, productivity at Yageo, and individual employee performances, annual salary raises will be
calculated. Yageo offers employees a wide range of benefits, which include:
Employee cafeteria
Group insurance
Travel allowance, gift vouchers, movie tickets from Employee Welfare Committee
21
Incentive and festival bonuses
Working Environment
Yageo also strives to provide a comfortable working
environment for employees. These include: safe and clean
working environment, friendly safety guards within factories.
3.4 Employee Relations
Yageo believes that high productivity and performance are based on harmonious employee
relationship. Therefore, Yageo dedicated to building employee relations by recognizing employee’s
achievements and enhancing open communication channels.
In order to timely deliver company policies to employees, Yageo communicates with employees
through various channels, listening and responding to employees’ feedback. Besides the formal
channels, the employee survey and the informal channel collect employee views and concerns.
Company information is communicated with employees through
1) Corporate business review meeting
2) Department meeting
3) Employee Portal
4) Bulletin board
Employees can raise concern through channels of direct supervisor, grievance
hotline, suggestion box, health & safety committee…etc.
3.5 Work and Life Balance Program
Work-Life balance is critical for your employees and your organization as a whole Yageo’s work
and life balance program helps employees enjoy a better quality of life and it also contributes to
Yageo’s success. Yageo cares employees’ well-beings by providing a healthy, safe working
environment, and offering a variety of activities.
3.5.1 Health Care
Yageo offers annual employee health examination, consultation service as well as on-site clinics for
convenient employee medical service.
22
3.5.2 Yageo Employee Welfare Committee
The Yageo Employee Welfare Committee (EWC) was established under the requirements of
Taiwan’s Employee Welfare regulations. The key objective is to provide comprehensive welfare
services to all employees, and help to keep a good balance between work and life. The EWC
organizes employee activities, special offers from contracted retailers, festival gifts, etc.
3.6 Safety and Health
3.6.1 Safety and Health Management
Yageo stipulated the "Safety and Health Policy" as our guidelines according to the OHSAS18001
occupational health management system standard and Yageo’s internal actual situation
requirements as the basis. Our goal is to achieve high quality of safety in the workplace, and high
security of labor health.
1. Have its business activities conducted in such a way to protect the health and safety of its
employees, and to minimize any adverse effects on the environment.
2. Implement working practices, which will prevent personal injury and damage to property.
3. Limit the potential to cause harm from known hazardous process by maintaining a safe system of
work, and by planning for emergencies which may reasonably be foreseen.
4. Involve its employee in carrying out the policy, and make them aware of their own responsibility
for the health and safety of themselves and others.
5. Provide appropriate training to ensure the competence of staff who advise on occupation health,
safety and environmental matters.
6. Secure the maximum benefit from our own experiences concerning dealing with health and
safety hazards for the good of the business as a whole.
3.6.2 Emergency Response
To ensure the safety of personnel is Yageo’s first priority of disaster response policy, followed by
avoiding pollution to the environment, to reduce property losses and maintain normal production.
We believe that when natural disasters or accidents occur, proper treatment in the initial stage of
the event not only reduce the chance of personnel injury and environmental pollution to the
minimum level, but also decreases losses and lowers the difficulty of resuming production to a
certain extent. Yageo pays a great amount of attention to emergency response - from emergency
equipment setup, creation of contingency procedures, drill, training, and other preparations.
23
4. CUSTOMER SERVICE & SUPPLIER MANAGEMENT
Yageo believes that customer service is
vital to strengthen customer loyalty and
enhance customer satisfaction, as such,
we are committed to providing efficient
and innovative services to our customers.
Customer loyalty will lead to higher levels
of customer retention and thus to
business relationships expansion.
Yageo also cooperates with suppliers to fulfill our corporate social responsibilities – we have
formed a reliable and sustainable supply chain network, which supports protection of the
environment, human rights, health and safety. The supplier selection criteria including ISO certified
vendor, non-use of hazardous substance guarantee, etc. Yageo committees and managing teams
execute a complete “Plan-Do-Check-Act” (P-D-C-A) cycle to align corporate direction in supply
chain management.
4.1 Customer Service and Satisfaction
4.1.1 Customer Service
Yageo aims to maintain its leading position in the passive component manufacturing technologies
and services. Achieving this goal will help Yageo to retain existing customers, attract new
customers, and further enhance customer relationships. To facilitate customer interaction and
information access on a real-time basis, Yageo has established a wide range of web-based
services covering applications in EDI, and online literature request. We also launched a B2B Portal
to provide online Order Management, Payment Service and Technical Support.
4.1.2 Customer Satisfaction
24
Yageo conducts surveys and reviews on a regular basis to
ensure that we understood and addressed customer’s
needs and wants adequately. We also integrated customer
feedback into our continuous improvement plans as part of
business processes.
In order to identify customer’s specific requirements and
expectation from Yageo, and gain direct feedback from
customers to evaluate Yageo’s strengths, weakness, opportunities and threats, an annual
Customer Satisfaction Survey has been carried out.
The team has reported the survey findings and analysis of customer feedback to the Yageo
management team. Appropriate action plans will be taken by related functional and regional teams,
and the improvement progress will be monitored closely.
4.2 Supply Chain Risk Management
The purchase of Yageo can be broadly classified into four major categories – raw material,
consumable parts, equipment maintenance & repair, and assets. In 2016, Yageo formed an internal
committee, dedicated to managing our supply chain - members come from global logistics,
materials management, risk management, and quality system management. The focuses of the
committee are risk alleviation and supply chain improvement. The steering team, including a senior
director and managers, guides annual goals and reviews progress on a quarterly basis.
The committee’s working team shares risk management practices with suppliers to assist them in
reducing production and transportation risks, helps suppliers improve quality systems, green
Singapore
RoermondBenelux
SuzhouChina
DongguanChina
KaohsiungTaiwan
SzombathelyHungary
SkierniewicePoland
TrajoucePortugal
25
procurement, and safety. Meanwhile, we also monitor the financial situation of strategic suppliers
through regular communication and public information, monitor the inventory of supply chain, and
draw up backup plans. The working team holds monthly meetings to keep track of progress and
actively handle suppliers’ issues.
We will ensure our supply chain conforms to ethical and environmental standards, other than
regular supplier evaluations, Yageo also maintains constant supplier communication and
relationship management. Our suppliers must guarantee and verify that their products do not
contain any of the hazardous substances prohibited by Yageo. Yageo has integrated key
CSR-related indicators, including RoHS, ISO14000 and OHSAS18000, and supplier localization
into its supplier evaluation and management criteria.
4.3 Helping Suppliers Improve Delivery and Quality
4.3.1 Lean Supply Chain
Global Logistics’ importance is increasing; logistics must support the goals of a lean manufacturing
program. We need detailed, timely and accurate information to make the right transactional,
planning and scheduling decisions for all aspects of the business. Therefore, Yageo works closely
with our suppliers to exchange inventory information, so the demand and price fluctuations can be
detected in early stage. We collaborate with our suppliers to build a strong and lean supply chain
together to reduce the supply interruption risk.
4.3.2 Collaborating for Continuous Improvement
Each quarter, Yageo evaluates strategic supplier performance for delivery, quality, and safety, and
the results of the evaluation are delivered to supplier’s top manager. Through regular meetings,
Yageo also works closely with its suppliers for performance improvement. We also provide special
technical support to suppliers through open communication meetings in certain projects.
4.4 Ensuring Supplier Compliance
4.4.1 Quarterly Business Review
Yageo conducts quarterly meetings with our key suppliers’ senior managers to review quality,
delivery and cost performance. Through semi-annual or quarterly monitoring of key indicators of a
scorecard and checklist, we ensure supplier’s compliance with Yageo requirements.
4.4.2 Site Audit
Based on an annual plan, Yageo’s purchasing department visits our suppliers and performs on-site
audits. If there are special concerns identified from these audits, we co-work with suppliers to
develop appropriate action items to meet our expectations. These solutions are executed by
specified person-in-charge with a clear goal and timeframe.
26
4.4.3 Certification
Key suppliers must acquire ISO-9001 certificate. Other suppliers have priority to be chosen if they
comply with HSF requirements or acquire ISO-9000/ ISO-14000 certification or have signed
environment protection sheet. Furthermore, we conduct site audits to ensure suppliers’ factories
are well protected by fire protection systems and measure supplier safety performance through
accident counts.
27
5. ENVRONMENTAL PROTECTION Nowadays, the global environmental consciousness is rising, the
environmentally friendly products, the “green” production
environment and management system become one of the
important industrial development trends. In the past few decades,
“going green” has become a trend for businesses around the
world to begin implementing environmentally friendly business
and production practices. Some of the global leading
manufacturers not only taking the lead to adopt the
environmentally friendly electronic parts, and also consider
capability of providing “green” products and production system as
one of the key criteria to choose their suppliers.
As the global passive component leader, Yageo strives to pursue
great business performance, and also spare no efforts to contribute to the environmental
conservation. Compared with the peers, Yageo is the pioneer to adapt BME (Biomedical
Engineering) manufacturing process. But the traditional BME uses solvent base, and will cause the
air pollution after evaporation, we changed the entire BME process to the water base. Although this
has increased the production cost by 6%, in order to solid execute the environmental protection
policy, Yageo still made the decision.
SONY Green Partner certificate is one of the most strict standard and most respectable in the world.
However, Yageo’s global MLCC and R-Chip factories, have obtained the Sony green partner
certificate in 2003.
As a pioneer in the field of lead-free, non-hazardous products, all of our products are RoHS
compliant, to fulfill our commitment to the environmental protection.
Environmental Policy
Yageo devised the environmental policy as our guidelines according to the ISO14001
environmental management system standard and Yageo’s internal actual requirements as the
basis. Our goal is “Clean Production and Sustainable Environmental Protection”, and main points
are as below:
1. Establish and implement an environmental management system.
2. Implement pollution prevention in compliance with legal requirements
3. Strive for business sustainable development and continue the environmental improvements.
4. Mobilization of all employees to be fully engaged in environmental protection activities.
5. Implement energy saving and waste minimization; strengthen resource recycling and reuse;
phase out or reduce the use of environmentally hazardous materials in production..
28
5.1 Green Management Organization and System
Yageo established a Green Management Organization structure according to the
ISO14001/ROHS/EICC/OHSAS18001 standard, and also considering company’s actual situation.
BU Head is the person-in-charge of this ISO14001/ROHS/EICC/OHSAS18001 organization, PED
manager is the management representative, human resources manager is the deputy,
environmental security supervisor and HR assistant manager are the executive secretary, each
department head is the direct supervisor of ISO14001/ROHS/EICC/OHSAS18001 for their
department, each department has to allocate at least one the full time or part-time personnel to be
responsible for the promotion.
Graphic 2. EHS Organization chart
5.1.1 ESH and Hazardous Substance Management System Certificates
All Yageo manufacturing facilities in Taiwan, and China have received ISO 14001 certification for
environmental management systems, OHSAS 18001 for occupational safety and health.
Accordingto ISO 14001 and OHSAS 18001’s concept of continuous improvement, Yageo is
devoted to establish a safe and comfortable work place by carrying out its responsibilities to
prevent pollution and accident, conserve energy and resource, and reduce waste.
OHSAS 18001 Certificate ISO 14001 Certificate
5.1.1 ESH and Hazardous Substance Management System Certificates
All Yageo manufacturing facilities in Taiwan, and China have received ISO 14001 certification for
environmental management systems, OHSAS 18001 for occupational safety and health. According
to ISO 14001 and OHSAS 18001’s concept of continuous improvement, Yageo is devoted to
establish a safe and comfortable work place by carrying out its responsibilities to prevent pollution
and accident, conserve energy and resource, and reduce waste.
29
OHSAS 18001 Certificate ISO 14001 Certificate
5.1.2 Waste Management and Resource Recycling
Yageo has waste control procedures - waste gas and water produced from the production is
controlled, and there's promotion of reuse. The identification of all commercial waste before waste
management suppliers taking out from Yageo, we have to apply via the website of Environmental
Protection Administration & get the permission documents. After Yageo double confirmed the
quantity, content of waste and the time that the supplier takes the waste out from Yageo. The
supplier should report back through the official website within 48 hours for government control &
monitoring.
30
1H 2H 1H 2H
Company Total Electrical energyconsumption 48,304,000 55,937,000
Company Total Water use 865,000 934,000
Recycling rate of Total waterconsumption 2.04m3/mpcs 2.01m3/mpcs 2.3m3/mpcs 2.3m3/mpcs
Company Total Hazardous waste 787,000 910,000
Company Total Non-Hazardous waste 86,500 98,020
Average Non-Hazardous waste createdper production unit kg/mpcs
0.40kg/mpcs 0.41kg/mpcs 0.56kg/mpcs 0.56kg/mpcs
Company Total CO2 equivalentemissions or CO2 emission
52,651 60,971
kg kg
tons CO2-equivalent tons CO2-equivalent
kg kg
tons CO2-equivalent tons CO2-equivalent
2016 target
kWh kWh
m3 m3
2016 actual
kWh kWh
m3 m3
Greenhouse Gas (GHG) Emissionstons
Waste Amount kg
Water use m3
Electrical energy consumption kWh
Information for Environmental KeyMetrics
Table 9 Yageo’s environmental protection indicators example
5.2 Declaration of Metal Conflict Free
Yageo Corporation herein declares the metal Conflict-Free on products supplied to customers.
Yageo Corporation take due diligence within our supply chain to assure "DRC Conflict-Free" for the
metals of gold (Au), tantalum (Ta), tungsten (W), and tin (Sn) are not derived from or sourced from
mines in conflict areas of the Democratic Republic of Congo (DRC), or illegally taxed on trade
routes, either of which are controlled by non-governmental military groups, or unlawful military
factions. Trade routes not confirmed to be "Conflict Free" include direct exports from the DRC, as
well as exports through Rwanda, Uganda, Burundi, Tanzania and Kenya or an adjoining country
(countries of whom defined in 2010 United States legislation, Dodd-Frank Wall Street Reform and
Consumer Protection Act note are global export routes for DRC-mined minerals).
We would like to confirm metals used in Products sold to customers are "DRC Conflict-Free".
5.3 Environmental Compliance Record
Yageo established communication channels regarding environmental compliance: via emails,
quarterly Environmental Safety Committee meetings, annual audit by government and customers.
In 2016, Yageo underwent self-assessment of ISO14001, RoHS, and OHSAS18001 in May and
Nov., in May, DNV conducted annual audit for ISO14001 and OHSAS18001, and all of the
non-compliance items have been fixed.
31
Yageo’s environmental compliance effort includes the following:
ISO 14001 Certification
OHSAS 18001 Certification
RoHS directive 2002/95/EC Compliance
Authorized SONY Green Partner
Samsung Eco Partner
SONY Green Partner Certificate Samsung ECO Partner Certificate
32
Page Number
G4-1 CEO statement 4G4-2 Description of key impacts, risks, and opportunities 7
G4-3 Name of the organizatoin 3G4-4 Primary brands, products, and services 6G4-5 Location of the organization's headquarters 5G4-6 Countries of operation 5G4-7 Nature of Ownership and legal form 5G4-8 Markets served 5G4-9 Scale of the organization 5-6G4-10 Composition of the workforce 19G4-11 Collective bargaining agreements 19-22G4-12 Organization's supply chain 24, 25G4-13 Significant changes during the reporting period 5G4-14 Precautionary approach 14-15G4-15 External charters 26G4-16 Memberships and partnerships 6
G4-17 List of all entities 3G4-18 Process for defining the report content and the aspect boundaries 11G4-22 Effect of any restatements of information provided in previous reports No ChangeG4-23 Significant reporting changes No Change
G4-24 List of stakeholder groups 12G4-25 Report the basis for identification and selection of stakeholders 12G4-26 Approach to s takeholder engagement 13G4-27 Key topics and concerns that have been raised 13
G4-28 Reporting period 3G4-29 Date of previous report 3G4-30 Reporting cycle 3G4-31 Contact point for questions regarding the report 3G4-32 Content index and in accordance 2
G4-34 Governance structure 9G4-35 Process for delegating authority for economic, environmental and social topics 9,10
G4-36Report whether the organizaiton has appointed positions with responsibility for economic,environmental and social topics, and whether post holders report directly to the highest governancebody
9,10
G4-37 Process for consultation between stakeholders and the highest governmance body 9,10G4-38 Composition of the highest governance body and its committees 10G4-39 Report whether the Chair of the highest governance body an executive officer 10G4-40 Nomination and selection processes for the highest governance body and its committees 10
G4-41 Processes for the highest governance body to ensure conflicts of interest are avoided and managed 11
G4-48 Highest committee or position that formally reviews and approves the organization's sustainabilityreport
10
G4-51 Remueration policies for the highest governance body and senior executives 11G4-52 Process for determining remuneration 11
G4-56 Organzation's values, principles, standards and norms of behavior such as codes of conduct andcodes of ethics
16
G4-57 Internal and external mechanisms for seeking avice on ethical and lawful behavior 11G4-58 Internal and external mechanisms for reporting concerns about unethical or unlawful behavior 11
Governance
Ethics And Integrity
Report Profile
General Standard Disclosures
Strategy and Analysis
Organizational Profile
Identified Material Aspects and Boundaries
Stakeholder Engagement
Appendix GRI G4 Guidelines Content Index
** Indicators that were voluntarily disclosed by Yageo but not included in the material aspects.
33
Report Release Date
Current Issue: June 2017
Previous Issue: June 2016
Report Issuance
This report can be accessed online at the Yageo corporate website. For any questions or
suggestions related to this report, please contact us.
Contact Details
Joanna Chiang, Corporate Marketing Department
Yageo Corporation
Address: 3F., No. 233-1, Baoqiao Rd.,
Xindian Dist., New Taipei City 23145, Taiwan
Tel. +886.2.6629.9999 Ext. 3762
CSR mailbox: csr@yageo.com
Official website: http://www.yageo.com/exep/pages/download/CSR2016.pdf
Aspect Page Number
G4-EC1 Direct economic value generated and disributed 8
G4-EC3 Coverage of the organization's defined benefit plan obligations 20
G4-EN3 Energy consumption within the organization 30
G4-EN6 Reduction of energy consumption 30
G4-EN15 Direct greenhouse gas (GHG) emission (scope 1) 30
G4-EN23 Total weight of waste by type and disposal method 29
Products andServices
G4-EN27 Extend of impact mitigation of environmental impacts of products and services 27
G4-LA2 Benefits provided to full-time employees 20, 21
G4-LA5Percentage of total workforce represented in formal joint management - wokerhealth and safety committees 20
G4-LA9 Average hours of training per year per employee 20
G4-LA11Percentage of employees receiving regular performance and careerdevelopment reviews 20
Child Labor G4-HR5Operations and suppliers identified as having significant risk for incidents ofchild labor, and measures taken to contribute to the effective abolition of childlabor
20
Indicators
EconomicPerformance
Economic Category
Labor Practices and Decent Work
Training andEducation
Human Rights
Environmental Category
Energy**
Emissions
Effluents and Waste
Social Category
Employment
OccupationalHealth and Safety
top related