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Sustainable procurement and supplier management
Sustainable procurement and supplier management
Sustainable Procurement
FFHC introduced the 7 core themes of the ISO 20400 Sustainable Procurement Guidance in 2020 to instill the concept of sustainability into procurement practices and Collaborate with suppliers to grasp the opportunity to create value together. The Group completed ISO 20400:2017 Sustainable Procurement Guidance Performance Evaluation certification in November 2022. The green purchasing target for 2022 was NT$80 million per year. The actual purchase amount in totaled NT$150.86 million.We were recognized as Benchmark Private Businesses and Groups in Green Purchasing by Taipei City Government for the 8th consecutive year.
●○ Process for Introducing the ISO 20400:2017 Sustainable Procurement Guidance
Supplier Sustainability Management
FFHC established the "Supplier Management Guidelines" as the policy and guiding principles for the management of suppliers of the Group. We require suppliers to comply with the Guidelines when signing contracts and we require suppliers to sign the "Human Rights and Environmental Sustainability Clauses" and to increase awareness. We also require subsidiaries to use site visits and audits to encourage suppliers to implement the Guidelines. The contents include basic labor rights for suppliers, environmental protection, sustainable management, and occupational safety and health regulations.
Please refer to the Company's website for specific contents of the Company's Supplier Management Guidelines.
FFHC set up a 3-step supply chain management process in 2013,supplier management is used to select vendors that satisfy the spirit of sustainable development as long-term partners, including: purchasing of energy-saving equipment, purchasing and maintenance of IT equipment, construction and interior design, business-related OA equipment and landscape and environmental greening engineering. As a principle, the main procurement regions include suppliers of the place country of operations and those close to business locations. In 2022 100%*1 of all purchasing came from local suppliers*2 to ensure the stability and localization of the supply chain as well as reduce carbon emissions in the transportation process and create local job opportunities.

The Company has actively striven to establish a green supply chain in order to implement an operation pattern that is responsible for the environment. First Financial Holding reviewed suppliers with relatively high procurement amounts in 2022 to get an overall assessment on whether they had practiced carbon footprint verification or set targets for carbon emissions reduction. In 2022, there were 211 suppliers with more than NT$1 million in procurement and business dealings with the Company during the previous two years. Among them, 15 were publicly listed suppliers that fell into critical procurement industries while having practiced carbon footprint verification or set carbon emissions reduction targets. The Company also plans to establish a GHG inventory platform for suppliers in 2023 to continue to get a better grip on suppliers' carbon emissions, in addition to refining supply chain's low carbon management measures.
*: 1:Calculated based on the 205 suppliers with whom the Group conducted transaction in 2022.
*: 2:Local refers to countries in which various locations of operations are based.
●○ Assessed whether suppliers have violated issues related to human rights and percentage of mitigation measures that have been implemented.
*1:According to the number of vendors in the 2022 statistics, 202 out of 472 suppliers were identified as risks in violation of human rights. They included 1 clothing service companies, 3 transportation companies, 95 decoration companies, 22 air conditioning companies, 55 plumbing and electrical engineering companies, 15 fire safety engineering companies, 7 landscape companies, and 4 solar power construction companies with higher rates of musculoskeletal injuries and occupational safety risks.
*2:There were no cases where suppliers of the Company received penalties for violation of labor laws before signing contracts or within the contract duration and failed to make improvements. Therefore, there were no records of termination of partnerships with suppliers.
●○ Identification of key suppliers' potential environmental and social impacts and their improvement rates
●○ 3-step Supply Chain Management Process