Stakeholder Engagement｜Material Issues and Management Approach

Material Issues and Management Approach

Matrix of Level of Potential Positive and Negative Impact and Likelihood of Occurrence

Definition of positive impact : Refers to positive or noticeable results generated by Winbond implementing measures in response to the topic, leading to a positive economic, environmental, or social (including human rights) impact on sustainable development. Definition of Negative impact: Refers to the negative economic, environmental, or social (including human rights) impact caused by Winbond’s overall business operations due to Winbond failing to implement or poorly implementing measures in response to the topic.

Matrix of Level of Potential Positive Impact and Likelihood of Occurrence

All

Environmental (E)

Social (S)

Governance (G)

Ranking of top 10 sustainability issues with positive or negative impact and likelihood of occurring

Matrix of Potential Negative Impact and Likelihood of Occurrence

All

Environmental (E)

Social (S)

Governance (G)

Note: Ranking of top 10 sustainability issues with positive or negative impact and likelihood of occurring

Material topics and their relationship with Winbond value chain

Environmental (E)

Social (S)

Governance (G)

Material Topic	Type of impact(positive/negative)	Description of impact(description of economy, environment, and people (including human rights) impact)	Scope of Impact to Value Chain	2023 Result (Please refer to the following sections)
Green Product	Improving product functions and reducing product energy consumption can create positive benefits for the environment. Product market competitiveness.	Consistent with sustainability trends, meet customer expectations, improve product positioning and revenues, while also benefiting the environment. Failure to meet customer demands would diminish product value and reduce revenue.				2.2 Quality management for products and services 2.3 customer relationship management
Energy and Greenhouse Gas Management	Carbon emissions management, calculating and managing carbon costs. If energy consumptions and emissions go unmanaged, this may lead to severe environmental impacts and accelerate the negative impact of climate change.	Managing Winbond’s energy consumption and greenhouse gas emissions to effectively reduce costs. Mitigati the potential operational impacts caused by extreme climate conditions.				3.1 Energy and greenhouse gas management

Material Topic

Type of impact(positive/negative)

Description of impact(description of economy, environment, and people (including human rights) impact)

Scope of Impact to Value Chain

2023 Result
(Please refer to the following sections)

Winbond

Customers

Supply Chain

Green Product

Improving product functions and reducing product energy consumption can create positive benefits for the environment.
Product market competitiveness.

Consistent with sustainability trends, meet customer expectations, improve product positioning and revenues, while also benefiting the environment.
Failure to meet customer demands would diminish product value and reduce revenue.

2.2 Quality management for products and services

2.3 customer relationship management

Energy and Greenhouse Gas Management

Carbon emissions management, calculating and managing carbon costs.
If energy consumptions and emissions go unmanaged, this may lead to severe environmental impacts and accelerate the negative impact of climate change.

Managing Winbond’s energy consumption and greenhouse gas emissions to effectively reduce costs.
Mitigati the potential operational impacts caused by extreme climate conditions.

3.1 Energy and greenhouse gas management

Material Topic	Type of impact(positive/negative)	Description of impact(description of economy, environment, and people (including human rights) impact)	Scope of Impact to Value Chain	2023 Result (Please refer to the following sections)
Talent Management	Bilateral communications between employers and employees help promote smooth business operations. The safety, diversity, equality, and compliance of the workplace environment significantly impact talent retention or turnover.	By enhancing talent acquisition and retention, as well as fostering employee skills and self-worth, we promote the sustainable operation of a happy enterprise and enhance our R&D innovation capabilities. Implementing occupational safety and health management, prevent serious workplace injuries, and promote the physical and mental well-being of employees.				5.1 Human rights 5.2 Talent attraction and development 5.3 Employee communication and relations 5.4 Occupational safety and health

Material Topic

Type of impact(positive/negative)

Description of impact(description of economy, environment, and people (including human rights) impact)

Scope of Impact to Value Chain

2023 Result
(Please refer to the following sections)

Winbond

Customers

Supply Chain

Talent Management

Bilateral communications between employers and employees help promote smooth business operations.
The safety, diversity, equality, and compliance of the workplace environment significantly impact talent retention or turnover.

By enhancing talent acquisition and retention, as well as fostering employee skills and self-worth, we promote the sustainable operation of a happy enterprise and enhance our R&D innovation capabilities.
Implementing occupational safety and health management, prevent serious workplace injuries, and promote the physical and mental well-being of employees.

5.1 Human rights

5.2 Talent attraction and development

5.3 Employee communication and relations

5.4 Occupational safety and health

Material Topic	Type of impact(positive/negative)	Description of impact(description of economy, environment, and people (including human rights) impact)	Scope of Impact to Value Chain			2023 Result (Please refer to the following sections)
Material Topic	Type of impact(positive/negative)		Winbond	Customers	Supply Chain	2023 Result (Please refer to the following sections)
Business Integrity and Corporate Governance	Improve positive brand image. Corruption and anti-competitive behavior reduce the trust that stakeholders have in Winbond, negatively affecting our operating revenue.	Well-established corporate governance and regulatory compliance lead to increased investment. Avoiding illegal activities prevents financial and rights losses for Winbond and certain groups.				1. Corporate Governance 2. Business integrity
Regulatory Compliance	Elevating reputation for sustainable operations. Receiving legal or regulatory penalties may damage Winbond’s reputation, and negatively impact our financial situation and employees.	Compliance with regulatory requirements enhances reputation, leading to increased investment and revenue. Avoiding the impact on society and Winbond resulting from non-compliance with social or environmental regulations.				1.2 Business integrity 3 Environmental sustainability 5.1 Human rights governance 5.4 Occupational safety and health
Risk Management	Improve corporate resilience, reducing the impact of risk on the Winbond. Without a risk management system, potential risks that occur may damage Winbond’s reputation and lead to financial losses Information security leaks may lead to security or financial losses	Through effective corporate governance, human rights, and supply chain risk management systems, the impact and likelihood of risks from climate change and human factors can be reduced Encourage greater investment from Winbond’s stakeholders				1.4 Risk management
Research, Development and Innovation	Research and development into improving energy conservation and carbon reduction performance are able to provide both Winbond and our customers with benefits. If research, development, and innovation are unable to provide results that customers are satisfied with, Winbond’s competitiveness would decline.	The energy conservation and carbon reduction benefits provided through research and development are able to reduce environmental impact. Innovative technologies can satisfy customer requirements, leading to more competitive products and higher revenues for Winbond.				2.1 Research, development, and innovation
Productivity and Business Performance	Increased productivity, positively impacting revenues. Insufficient productivity, reducing business performance.	Increased productivity can reduce costs and waste, improving business performance and capabilities. Insufficient productivity can lead to higher costs and waste, leading to revenue losses and increased environmental burden.				1.3 Productivity and business performance
Supply Chain Management	Refine the supply chain management system, making the goods supply process more stable and smooth. Supply channels obstructed, leading to production and sales delays.	Build a comprehensive supply chain management system, ensuring that supply is stable, leading to increased business production efficiency and higher revenues. Poor management of the social and environmental aspects of the supply chain, leading to lower customer trust and sales orders.				4 Sustainable supply chain

Note:

Direct impact
Indirect impact through commercial relationship

Strategies and Goals for Material Topics

Business Integrity and Corporate Governance

Regulatory Compliance

Risk Management

Research, Development and Innovation

Productivity and Business Performance

Supply Chain Management

Green Product

Energy and Greenhouse Gas Management

Talent Management

Legal compliance is the minimum threshold to be achieved. The Winbond considers “ethical business management” to be the highest standard for business ethics, and by following these standards, the Company strives for mutual prosperity for both the Company and society.

2023 Goal

Attain top 20% ranking in TWSE Corporate Governance Evaluation.
Ensure that, from 2025 onwards, female board seats account for ≥1/3.

2023 Performance

✔ listed in top 6 -20%
3 female directors, accounting for 27%

2024 Short-Term Goal

listed in top 20%

2030 Mid- & Long-Term Goal

listed in top 20%
From 2025, female board seats will account for ≥1/3

Winbond shall fully complies with all laws and regulations on corporate governance, financial operations, trade, environmental protection, occupational safety and health, information security, intellectual property, worker rights, internal controls, and risk management relevant to our business operations.

2023 Goal

Implement and conduct 12 regulatory compliance –related courses/year.
Ensure strict compliance with relevant domestic and foreign laws and regulations, with no major violations.

2023 Performance

✔ 21 courses
✔ 0

2024 Short-Term Goal

>12 course/year
0

2030 Mid- & Long-Term Goal

>15 course/year
0

Adhering to the goal of sustainable business operations, establishing a risk management mechanism, integrating and managing various potential risks that may affect operations and profitability, including but not limited to financial, environmental, cybersecurity, operational, and climate risks.

2023 Goal

Strengthen climate resilience and formulate measures climate change adaptation and prevention to minimize the impact of climate risks and production disruptions caused by climate disasters.

2023 Performance

✔ 0 days

2024 Short-Term Goal

0 days

2030 Mid- & Long-Term Goal

0 days

Winbond promises to provide the most competitive products and services in our targeted markets. Winbond promises to deliver most energy efficient and power saving, as well as low carbon emission, products through our innovative technologies from R&D.

2023 Goal

Achieve over 80% customer satisfaction
Obtain approval for 350 patents worldwide

2023 Performance

✔ 85.2%
✔ 390 patents

2024 Short-Term Goal

>80%
>350 patents

2030 Mid- & Long-Term Goal

>80%
>350 patents

Winbond is committed to improving productivity and business performance, with sustainable development and the enhancement of corporate value as our guiding goals. We are actively promoting digital transformation, introducing advanced technology, and popularizing the application of data and AI. We continuously optimize our business strategy and management models to improve corporate competitiveness and market share, while also strengthening employee training and motivation.

2023 Goal

Complete at least 24 digital transformation activities and training sessions in 2023

2023 Performance

✔ 35 sessions

2024 Short-Term Goal

72 sessions

2030 Mid- & Long-Term Goal

72 sessions

Winbond is committed to ensuring the stability of our supply chains, improving supply chain transparency, and establishing and implementing polices on environmental protection and corporate social responsibility through close collaborations with our suppliers. These efforts aim to promote the overall legal compliance and continued development of the overall supply chain.

2023 Goal

Conduct an annual survey of major suppliers to assess their sustainable supply chain resource usage, with a focus on improving the survey response rate each year
Achieve a high implementation rate of sustainability risk assessment of key suppliers
Achieve a high installation and utilization rate of the outsourced product GHG emission data exchange standard module for suppliers
Plan the implementation and utilization of internal logistics operational systems and green electricity product production systems
Achieve a 37% localization rate in key raw material procurement
Complete 8 projects focus on developing multi-sources for key raw materials
Enhance the construction and utilization rates of the suppliers ESG Interactive Network
Host annual Suppliers ESG Co-Learning Workshops (cumulative sessions)
Organize annual Sustainable Supply Chain Forums (cumulative sessions)
Provide 28 hours ESG education and training for internal supply chain colleagues (per person)

2023 Performance

✔ ≧90%
✔ 100%
Installation rate 60%
Installation rate 60%
✔ 37%
✔ 8 projects
Installation Rate>90%
✔ 24 sessions
✔ 3 sessions
✔ 28 hours per person

2024 Short-Term Goal

≧91%
100%
Installation rate 100%
Installation rate 100%
38%
14 projects
Utilization rate 100%
32 sessions
5 sessions
30 hours per person

2030 Mid- & Long-Term Goal

≧93%
100%
Utilization rate 100%
Utilization rate 100%
41%
26 projects
Utilization rate 100%
80 sessions
20 sessions
40 hours per person

Winbond’s vision is to become a “hidden champion in providing sustainable semiconductors to enrich human life”, and Winbond has devoted ourselves to developing a high-efficiency, small-size, low energy-consumption, and high-quality green memory products and green manufacturing processes.

2023 Goal

1.2V HyperRAM mass production
3V Spi NOR RV series mass production

2023 Performance

✔ The 1.2V HyperRAM products were mass-produced utilizing advanced, compact packaging such as 49BGA and WLCSP. (Note 1)
✔ The RV series produced 34% less GHG emissions than the 90nm DV series

2024 Short-Term Goal

Energy savings and GHG emission reductions at the customer application end >33% (Note 2)
GHG reduction of 35,000 tCO2e (Note 4)

2030 Mid- & Long-Term Goal

20% reduction in GHG emissions throughout the products’ life cycle. (Note 3)
GHG reduction of 110,000 tCO2e (Note 4)

Combine data science and professional knowledge, and together with our plant facility systems suppliers, continue to improve energy usage efficiency, gradually increase the proportion of renewable energy used, and reduce greenhouse gas emissions.

2023 Goal

Total power saving: 2~3%
YoY reduction in electricity consumption per unit product: ≥ 1%
YoY reduction in GHG emission intensity: ≥5%
The water recycling rate of the entire plants ≥ 80%
Overall waste recycling rate: ≥ 90%
Reduction rate of volatile organic compounds (VOCs): ≥ 93%

2023 Performance

✔ 4.2%
Increased 22.8% (Note 5)
Increased 17.4% (Note 5)
✔ 82.2%
✔ 90.9%
✔ 98%

2024 Short-Term Goal

2~3%
≥1%
≥5%
≥80%
≥90%
≥93%

2030 Mid- & Long-Term Goal

>2~3%
≥1%
≥5%
≥80%
≥90%
≥93%

Winbond is committed to providing a high-quality working environment, competitive compensation and benefits to attract, develop, and retain our talents, aiming to enhance employee engagement and dedication.

2023 Goal

Global human rights and labor ethics training course – achieve a 100% attendance rate
Ensure social inclusion donations > NT$10 million
Maintain total compensation within the top 25% of the industry
Attain ≥95% employee retention and willingness to contribute at Winbond for the next 5 years, based on the 2023 Employee Core Values and Engagement Survey results
(Important operating sites-WEC) Ensure the average number of learning hours per employee reaches 48 hours

2023 Performance

✔ 100%
✔ NT$18.11 million
✔ Top 25% (Note 6)
✔ ≧ 97%
✔ 50 hours per person

2024 Short-Term Goal

100%
>NT$10 million
Top 25%
≧95%
50 hours per person

2030 Mid- & Long-Term Goal

100%
>NT$10 million
Top 25%
≧95%
65 hours per person

Note: 1: The 128Mb~512Mb products were mass-produced in 49BGA package, and the 1.2V/128Mb products were mass-produced in WLCSP (Wafer-Level Chip-Scale Package). 2: This calculation was based on 25nm 1.2V/128Mb HyperRAM product.

3: Calculations were based on the entire range of dynamic random-access memory (DRAM) products including the process evolution.

4: Calculations were based on the entire range of flash memory products including the process evolution.

5: The challenge in meeting targets was linked to the global economic recession in 2023, resulting in decreased production capacity. Furthermore, the Kaohsiung fab not yet attained economies of scale, contributing to elevated average electricity consumption and emissions per unit product.

6: Data was sourced from the figures published annually in July by the Taiwan Stock Exchange Market Observation Post System for the preceding year.

Alignment of Major Topics with GRI, SASB, UN Global Compact, SDGs, and Winbond Commitments

Winbond aligns nine major issues with international standards, including the Global Reporting Initiative, (GRI), the Sustainability Accounting Standards Board, (SASB), the United Nations Global Compact, (UNGC) and the United Nations Sustainable Development Goals, (SDGs).

Environmental (E)

Social (S)

Governance (G)

Material Topic	Significance to Winbond	Commitment of Winbond	GRI	SASB	UNGC	SDGs
Green Product	Creating value, reducing risks, and developing sustainable technologies and products in order to create secure,energy-saving, and smart lifestyles	Winbond’s vision is to become a “hidden champion in providing sustainable semiconductors to enrich human life”, and Winbond has devoted ourselves to developing a high-efficiency, small-size, low energy-consumption, and high-quality green memory products and green manufacturing processes.	GRI 417 Marketing and Labeling	TC-SC-410a.1 TC-SC-410a.2 Product lifecycle management	Encourage the development and diffusion of environmentally friendly technologies.
Energy and Greenhouse Gas Management	Extreme climate conditions threaten to upset ecosystem balance. Winbond needs to do our part to save energy and reduce carbon emissions.	Combine data science and professional knowledge, and together with our plant facility systems suppliers, continue to improve energy usage efficiency, gradually increase the proportion of renewable energy used, and reduce greenhouse gas emissions.	GRI 302 Energy GRI 305 Emission	TC-SC-110a.1 TC-SC-110a.2 Greenhouse Gas Emissions TC-SC-130a.1 Energy emission	Businesses should support a precautionary approach to environmental challenges. Undertake initiatives to promote greater environmental responsibility

Material Topic	Significance to Winbond	Commitment of Winbond	GRI	SASB	UNGC	SDGs
Talent Management	Talent is the key to Winbond’s success. Recruiting talent, using talent, cultivating talent, and retaining talent are all long-term operational tasks.	Winbond is committed to providing a high-quality working environment, competitive compensation and benefits to attract, develop, and retain our talents, aiming to enhance employee engagement and dedication.	GRI 401 Employment GRI 403 Occupational Health and Safety GRI 404 Training and Education GRI 405 Diversity and Equal Opportunity GRI 406 Non-discrimination GRI 408 Child Labor	TC-SC-320a.1 TC-SC-320a.2 Workforce Health & Safety TC-SC-330a.1 Recruiting & Managing a Global & Skilled Workforce	Businesses should support and respect the protection of internationally proclaimed human rights. Make sure that they are not complicit in human rights abuses. Businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining. The elimination of all forms of forced and compulsory labour. The effective abolition of child labour. The elimination of discrimination in respect of employment and occupation.

Material Topic	Significance to Winbond	Commitment of Winbond	GRI	SASB	UNGC
Business Integrity and Corporate Governance	In the knowledge economy, business integrity and corporate governance are vital for high-tech firms such as Winbond.	Adherence to legal regulations is the fundamental baseline; "business integrity" represents Winbond's highest ethical standard. Based on this principle, we strive for the mutual prosperity of both the company and society.	GRI 205 Anti-Corruption GRI 206 Anti-competitive Behavior	TC-SC-520a.1 Intellectual Property Protection & Competitive Behaviour	Businesses should work against corruption in all its forms, including extortion and bribery.
Regulatory Compliance	Winbond is committed to a corporate philosophy of sustainable development, and to doing our part as a responsible corporation. Winbond has complied with all laws and regulations throughout our overall business operations.	Winbond shall fully complies with all laws and regulations on corporate governance, financial operations, trade, environmental protection, occupational safety and health, information security, intellectual property, worker rights, internal controls, and risk management relevant to our business operations.	Regulatory compliance (self-defined topic)
Risk Management	A sound and well-implemented risk management system is the foundation of Winbond’s sustainable business operations.	Adhering to the goal of sustainable business operations, establishing a risk management mechanism, integrating and managing various potential risks that may affect operations and profitability, including but not limited to financial, environmental, cybersecurity, operational, and climate risks.	Risk management (Self-defined topic)
Research, Development and Innovation	Research, development and innovation into our products, technologies, and business model are the sources of our competitiveness and value. They are also one of the most effective ways to conserve energy and reduce carbon emissions.	Winbond promises to deliver most competitive, energy-efficient, power-saving, and low-carbon-emission products through our innovative technologies developed in R&D.	Research & Development and Innovation (Self-defined topics)
Productivity and Business Performance	Productivity and business performance are critical to Winbond’s continued development. Improving productivity can lead to lower costs and less waste while increasing income at the same time, further increasing corporate profits and improving business performance.	Winbond is committed to improving productivity and business performance, with sustainable development and the enhancement of corporate value as our guiding goals. We are actively promoting digital transformation, introducing advanced technology, and popularizing the application of data and AI. We continuously optimize our business strategy and management models to improve corporate competitiveness and market share, while also strengthening employee training and motivation.	GRI 201 Economic Performance
Supply Chain Management	Building a sustainable and resilient supply chain system, coordinating and integrating logistics, production, procurement, and other sales-related activities, achieving high production and service efficiency and maximizing value.	Winbond is committed to ensuring the stability of our supply chains, improving supply chain transparency, and establishing and implementing polices on environmental protection and corporate social responsibility through close collaborations with our suppliers. These efforts aim to promote the overall legal compliance and continued development of the overall supply chain.	GRI 308 Supplier Environmental Assessment GRI 414 Supplier Social Assessment	TC-SC-440a.1 Material sourcing	Make sure that they are not complicit in human rights abuses.