Supplier Management Strategy

ASUS expects the cooperation with the supply chain to be based on long-term interests to create the win-win partnership. Therefore, we now do not focus on only traditional supply chain management models such as quality, cost, and trading procedures to choose our partners. In addition, we look for the possibility of establishing a supply chain with sustainable competitive advantage to create a new business model for sustainable development through identifying and managing risks of supply chain in governance, the environment and society.

Risk Identification and Management

According to the analysis by the latest international sustainable situation report and by Responsible Business Alliance (RBA, labor, environment, and governance are the major risks for the sustainable operation of the electronics industry. As a result, ASUS identified the most relevant risk issues with ASUS through the stakeholder engagement, the consideration of international laws, NGO organizations, and requirements of sustainability from customers, including: conflict mineral and labor protection in labor area, and the use of hazardous substance, greenhouse gas emissions, and water footprint in environment area.

At the same time, supplier risk identification procedures are established based on factors such as industry characteristics, procurement model, and geographical relationships. Through the evaluation on RBA compliance, brand reputation, brand management, continuous improvement, hazardous substances, and labor hiring, we classified our suppliers with continuous partnership by different level. Those identified as high-risk suppliers will be arrange for second and third-party audits to reduce related risks through continuous improvement tracking.

Sustainable Procurement Project

In December 2019, ASUS announced that the company received the ISO 20400:2017 certification for responsible practices in sustainable procurement from SGS, a leading global inspection, verification and certification firm. ASUS is the world's first recipient of the certification from SGS.

The certification is based on standards developed by the International Organization for Standardization, one of the world’s leading standards bodies with widely adhered-to international standards that apply to an array of global challenges, including those related to the environment. ISO 20400: 2017 standards pertaining to sustainable procurement ensure that a company’s procurement activities balance meeting its needs for products and services with minimizing environmental, social and economic impacts. Receiving this certification demonstrates the ASUS commitment to prioritizing environmental protection and sustainability in the company’s business practices.

The certification is the latest in a string of ASUS achievements related to sustainable business practices and corporate social responsibility, following wins of two Global Corporate Sustainability Awards last month at the Global Corporate Sustainability Forum (GCSF) and the release of the 2018 ASUS Environmental Profit and Loss (EP&L) Report. ASUS made the certification announcement at the company’s annual sustainable supplier event in Taipei.

For more than a decade, ASUS has proven itself to be a company that values corporate sustainability. In his speech marking the event, ASUS Co-CEO Samson Hu highlighted several of the company’s accomplishments in corporate sustainability.“ ASUS took the lead among our peers last year with the release of our Environmental Profit and Loss (EP&L) Report, thereby challenging the industry to confront a need to prioritize the environment in our business practices,” said Hu. “This year, we further implemented the concept of sustainable procurement and, as a result, obtained the world's first ISO 20400:2017 sustainable procurement certification from SGS, demonstrating that ASUS has incorporated sustainable management principles into procurement policies and practices.”

ASUS has established sustainability principles for its operations and business practices and has adopted a strategy of data-based measurement, continuous improvement, and diligent oversight of supply chains. In November, ASUS won two awards related to these efforts at the GCSF’s 2019 Global Corporate Sustainability Awards. The company earned the Best Practice Award for the introduction of quantitative measurements for sustainable supply chain management, and ASUS Chairman Jonney Shih received the Professional Award for his corporate sustainability leadership.

ASUS also actively participates in international membership organizations focused on building corporate social responsibility into global supply chains. One such organization is the Responsible Business Alliance, of which ASUS is one of only a few companies with Full Member status. Furthermore, ASUS conducts a quarterly business review of each supplier in order to ensure that suppliers meet company standards for sustainable procurement. As a forward-looking company, ASUS values product innovation while also valuing efforts to address global issues such as climate change, sustainable supply chains, digital divides and circular economies.