Sustainable Supply Chain

Supplier Development Program

Issue Date:2023/06/29

Supplier Development program

The well-rounded supplier assessment and development mechanism is established at Chunghwa Telecom to ensure that an effective management of ESG risks of the vast army of suppliers. Also, a well-rounded supportive development system is built to assist suppliers in improving and developing their ESG competencies for them to march towards sustainable low-carbon industry transformation with Chunghwa Telecom.

Supplier Assessment Process

Chunghwa Telecom conducts a comprehensive supplier sustainability/ESG risk assessment. Through the supplier ESG questionnaire, on-site visit by employees (second-party assessment), and on-site audit to suppliers (executed by SGS-Taiwan under commission), we ensure that our partnership with suppliers achieve the best practices for the environment, society, and corporate governance, meeting the requirements of the sustainable supply chain management objectives.

Assessment Approach Description
Desk Assessment
  • Fill-out of ESG self-assessment questionnaire required for all suppliers
  • Fill-out of the ESG questionnaire in the system for suppliers with a procurement amount of NT$5 million or more, with relevant supporting materials provided, including relevant ESG policies, management system certificates, management documents, etc.
  • Review of the supporting documents of suppliers by employees and external consultants to assess the commitment, implementation status, and possible risks of suppliers on relevant ESG issues
On-site Assessment by Company Employees (Second-party Assessment)
  • On-site visit and assessment of suppliers by CHT employees on a regular basis to assess the ESG performance and risks of suppliers via on-site checks, interviews, and verification of relevant information
Assessment by Independent Third-party Entity (Third-party Assessment)
  • On-site audits to the sites of at least 40 significant suppliers selected each year by the commissioned independent third-party entity (SGS-Taiwan) to verify the implementation status and risks in accordance with the “Chunghwa Telecom Supplier Code of Conduct” and the ESG Compliance Checklist
Supplier Assessment 2022 Target for 2022
Total number of suppliers assessed via desk assessments/on-site assessments 192
% of significant suppliers assessed 100 % 100 %
Number of suppliers assessed with substantial actual/potential negative impacts 11
% of suppliers with substantial actual/potential negative impacts with agreed corrective action/improvement plan 100 %
Number of suppliers with substantial actual/potential negative impacts that were terminated 0

Corrective action plan for Suppliers
Corrective Action Plan Support 2022 Target for 2022
Total number of suppliers supported in corrective action plan implementation 9
% of suppliers supported in corrective action plan implementation 82% % of significant suppliers: 80%
Supplier Development

Chunghwa Telecom is committed to improving the ESG competencies of suppliers and assisting suppliers in implementing various ESG policies and action plans. Through corresponding training and coaching, it helps suppliers further improve ESG competencies and strengthens its partnerships with suppliers.

Category Description
ESG Program Information/Training
  • Provision of detailed information on the Supplier ESG Program in the supplier procurement system, including the code documentation, contract clauses, and ESG-related forms
  • Regular organization of supplier education and training, supplier partnership exchange conference, and provision of promotion and education on information related to the ESG Program
Provision of ESG Benchmark Information
  • Provision of ESG courses/benchmark information over the platform of Chunghwa Telecom Training Institute built by CHT
Assistance in Improvement Measures
  • External consultants commissioned to provide remote consulting support/review of the improvement measures of suppliers
  • Provision of information by internal employees in response to suppliers’ inquiries on improvement measures
In-depth Support Program
  • CDP Supply Chain Program: Joining the CDP Supply Chain Program and provision of consultation and training to help suppliers improve their carbon management/disclosure capabilities
  • Environmental Sustainability Education: Suppliers led to environmental education facilities to conduct supplier environmental education to help them build the environmental protection knowledge each year
  • Green Gold Workshop: Workshops organized to invite significant suppliers to join specific programs to jointly develop low-carbon products and services as well as green commodities

Capacity Building Programs for Suppliers
Capacity Building Programs 2022 Target for 2022
Total number of significant suppliers in capacity building programs 176                                               
% of significant suppliers in capacity building programs 82% % of significant suppliers: 80%