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Climate Risk and Opportunity Assessment

Climate Risk and Opportunity Assessment

As countries around the world strengthen their carbon reduction targets and policies, aiming for net zero emission by 2050, the pressure on business operation and customers’ demand for supply chain sustainability have intensified. Although Taiflex is not subject to the major electricity consumer clause, we have mapped out relevant investments to reduce carbon emissions in response to the low carbon transition driven by global climate changes. We will continue to focus on and implement the climate action targets after the Paris Agreement as well as the targets of stakeholders, and gradually incorporate them into our sustainable development strategy.

The Board had approved the sustainable development roadmap in January 2023 and authorized the Sustainable Development Committee to manage climate risks. Functional teams under the Committee are tasked with promoting climate action issues and goal management. This ensures the integration of sustainability strategies and climate action issues into product, operation, and value chain management.

TCFD Framework for Taiflex

  • Governance

    The Sustainable Development Committee reports to the Board twice a year, reviewing climate change-related risks and opportunities, and proposing corresponding short, medium, and long-term plans, measures, and goals. The Board regularly evaluates the effectiveness of climate response strategies based on the plan progress of functional teams summarized by the Sustainable Development Committee (Sustainability Center).

    • Sustainable Development Committee
      Being the highest climate change management body, its members are determined by the Board with over half being Independent Directors and the elected convener oversees relevant affairs. The Committee consists of six functional teams.
    • Corporate Governance and Risk Management Team
      Take inventory on the Company's risk environment, risk management priorities and response measures, and assess the financial impact of risks.
    • Environmental Sustainability Team
      Monitor international trend of environmental issues, take inventory on the risks and opportunities brought about by climate change, and set targets and implementation plans.

  • Strategy

    Conduct cross-departmental discussions to address short, medium, and long-term climate risks and opportunities identified; adopt scenario analysis to assess potential financial impacts on the Company; integrate resources to determine the allocation priority, and formulate response strategies based on the Company's technological advantages. Currently, we focus on the following two directions:

    • Introduce new processes and eco-friendly facilities to improve the recycling rate of chemicals, thereby reducing resource consumption and saving costs. Develop new green products using chemical formulas with low biological reproductive hazards to satisfy the ESG requirements of end-users, aiming to enhance the Company's reputation and increase sales.

  • Risk Management

    With reference to the risk identification/assessment model recommended by TCFD, climate risk items are incorporated into the existing risk management process, with response plans and objectives proposed for each item. The Sustainable Development Committee tracks and manages these plans and objectives on an ongoing basis and regularly reports to the Board on the implementation status in order to refine the overall strategic direction.

  • Metric and Target

    • Short-term goals (2024):
      - 4% reduction in GHG Scope 1 emissions with 2021 being the base year.
      - Use of renewable energy accounts for 1% of total electricity consumption.
      - Cumulative installed solar capacity of 1,657 kW by Taiflex Green Power (subsidiary)
    • Medium-term goals (2025-2027):
      - 12% reduction in GHG Scope 1 emissions with 2021 being the base year.
      - Use of renewable energy accounts for 6% of total electricity consumption.
      - Cumulative installed solar capacity of 2,949 kW by Taiflex Green Power (subsidiary); and biomass energy capacity of 280Kw.
    • Long-term goal (2028~):
      - >27% reduction in GHG Scope 1 emissions with 2021 being the base year.
      - Use of renewable energy accounts for 10% of total electricity consumption.
      - Cumulative installed solar capacity of 3,379 kW by Taiflex Green Power (subsidiary); and biomass energy capacity of 280kW.