Supply Chain Management Performance

Hazardous Substance Free Audit

ASUS identified high-risk suppliers based on risk factors such as hazardous substance free test in finished products and components, daily management, and high risk in material and production process, and then performed audits according to ASUS GreenASUS HSF Standards. A total of 29 onsite audits were conducted in 2017, with an average approved rate of 93%. The audit results showed that the dimensions of QPA contributed the most findings. The average approved ratio was shown as below:

In order to assist suppliers in correcting the findings, ASUS holds corrective action counselling to share industrial cases, enhancing supplier management awareness and improvement capabilities. The findings in 2017 were completed. The details of the findings and corrective actions were shown below:

Corporate Social Responsibility (CSR) Assessment

In 2017, ASUS and the third party completed CSR onsite audits on 20 OEM providers and key component suppliers. The result showed that 45% (9) of them were approved, 25% (5) were conditionally approved, and 30% (6) was rejected; the average approved rate was 70%.The audit results showed that the dimensions of Health and Safety and of Ethics contributed the most findings. The average approved ratio was shown as below:

The findings in 2017 were completed. The details of the findings and corrective actions were shown below:

Per the statistics of 2015~2017 CSR audit findings, the dimension with the worst performance was still health and safety management as some of the suppliers have not introduced Occupational Health and Safety Management Systems (OHSAS 180001) or developed the similar management procedures. In order to improve those findings, ASUS shared the benefits and management cases of the establishment of the management system during the onsite auditing. At the same time, ASUS shared technical information and industrial cases of various management systems through the quarterly forum, the supplier workshop, and the corrective action counselling.

Milestone and Achievements:

More safety mechanism needed for those specific employments, ASUS established additional management procedures for child labor, underage labor, female labor:

Prohibition of Child Labor

Many children lose their chances to receive education, are deprived of childhood, and are forced to enter workplace in advance in order to solve the family economic problems. Therefore, most countries around the world consider the employment of child labor is illegal. ASUS strictly requires suppliers not to employ child labor and conducts onsite audits to ensure that suppliers have implemented proper measures to prevent child labor. Audit criteria include: review the management mechanism of suppliers and human resources intermediaries, the effectiveness of forged identity prevention mechanism (such as: face identification system, identity authentication system, family background information check), and sampling interviews with workers onsite. ASUS pays serious attention to child labor issue and formulate the following management approaches:

  1. ASUS reports to both ASUS’ and supplier’ sales management teams, and supplier shall immediately remove the children from the position as well as send them home.
  2. Supplier shall arrange health examination for the children, and bear the medical expenses for any affected health from the work.
  3. Supplier shall monitor the return home of children and their school attendance to legal age of employment.
  4. Supplier shall propose improvement plans in child labor management mechanism.
  5. ASUS arranges onsite audit and confirm the corrective action.

According to 2017 CSR audit results, no case of child labor was identified in the supply chain.

Management of Underage Labors

According to China legislation, employees of at least 16 but less than 18 years of age are underage employees. Specific protective measures have to be taken for these individuals still in puberty. ASUS requires suppliers to take the following measures when hiring underage employees to ensure their proper physical and mental developments:

  1. Underage employees must not be assigned to duties requiring intensive labor and exposing to extreme temperature operation or to hazardous substance such as lead, benzene or formalin.
  2. Conduct annual health examination on underage employees. ASUS will ensure the compliance by random interviews with underage employees and by reviewing their annual physical examinations.

According to 2017 CSR audit results, no case of overtime and night shift for underage employees.

Safeguarding the Rights of Female Employees

Female employees may experience pregnancy and breastfeeding while pursuing their careers, and ASUS pays great attention to the impacts of working environment on their health and thus proactively formulate protective measures for these future mothers. We include clauses that protect female employees from the voluntary social responsibility standard (Social Accountability 8000 International Standard, SA8000) into ASUS Supplier Code of Conduct and require our suppliers to take the following measures:

  1. For pregnant and nursing employees, the risk assessment of the operating environment to health
  2. Change their job positions when any risk exists
  3. No overtime and night shift for pregnant and nursing employees

According to 2017 CSR audits, no case in which the working environment had significant impacts on the health of female employees, and no pregnant and nursing employee was found to work overtime and night shift.