TSMC Annual Report > 2016 > Corporate Social Responsibility > Overview

Overview

TSMC believes a company’s corporate social responsibility is to uplift society. As a result, in addition to actively strengthening TSMC’s competitiveness in its core business of dedicated IC foundries, the Company is also continuously active in the economic, environmental and social dimensions of corporate responsibility and attends to the rights of all stakeholders including employees, shareholders/investors, customers, suppliers, and local communities to serve as a positive force in society.

The Scope of Corporate Social Responsibility

TSMC has declared “Uplifting Society” as the Company vision and identified three primary missions: “Acting with Integrity,” “Strengthening Environmental Protection,” and “Caring for the Disadvantaged” in its Corporate Social Responsibility Policy. The CSR matrix below, set by Chairman Dr. Morris Chang, clearly defines the scope of that responsibility. The horizontal axis shows the seven areas where TSMC aims to set an example: morality, business ethics, economy, rule of law, sustainability, work/life balance and happiness, and philanthropy. On the vertical axis are actions that TSMC has taken to fulfill its responsibilities.

TSMC CSR Matrix

Society

TSMC

Morality

Business Ethics

Economy

Rule of Law

Sustainability

Work/Life Balance Happiness

Philanthropy

Integrity

V

V

Law Compliance

V

Anti-Corruption
Anti-Bribery
Anti-Cronyism

V

V

V

Environmental
 Protection
Climate Control
Energy Conservation

V

V

Corporate Governance

V

V

V

Provide Well-Paying
 Jobs

V

V

Good  Shareholder
 Return

V

Employees’ Work/Life
 Balance

V

Encourage Innovation

V

V

Good Work
 Environment

V

Volunteers Organization

V

V

V

Education and Culture
 Foundation

V

CSR Management

As the TSMC’s top-level group for corporate social responsibility, the CSR committee acts as a center for decision-making and platform for coordination throughout the Company. TSMC’s CFO (chief financial officer) serves as chairperson of the CSR committee, which is comprised of representatives from each functional organization. The committee meets each quarter to discuss developments and future directions of CSR operations. It also coordinates across all organizations based on the type and nature of issues addressed and monitors the progress and effectiveness of CSR projects.

Functions related to CSR include legal, customer service, materials management, quality and reliability, research and development, risk management, finance, investor relations, operations, human resources, the TSMC Foundation, the TSMC Volunteer Program, public relations and environment, health, and safety. These functions are responsible for addressing CSR issues of interest to employees, shareholders/investors, customers, suppliers, governments, communities, and other stakeholders to systematically and effectively fulfill the Company’s corporate social responsibilities. The CSR committee chairperson leads committee to jointly set the Company’s CSR strategy, identify key issues for the year and monitor the execution of related projects and budgets by each organization to ensure they are effectively carried out. The CSR committee chairperson also annually reports the current year’s results and submits plans for the upcoming year to the board of directors.

Stakeholder Engagement

TSMC’s approach to stakeholder relations is divided into four stages: identification, analysis, planning and engagement. In order to pursue sustainable operations, TSMC not only performs direct communications with each of its stakeholders through multiple channels established by CSR-related units but also maintains a ”Stakeholder Engagement” section on the corporate website, as well as a CSR mailbox to gather a broad range of views from the public. The CSR mailbox, set up in 2011, is managed by dedicated public relations staff, and submissions are sent to relevant departments according to the nature and range of issues addressed. In 2016, the TSMC CSR mailbox received 472 submissions, including requests for surveys, studies and visits, inquiries about daily operations, recruiting and CSR-related experience sharing, suggestions and complaints from the public, and requests for endorsement, donation and collaboration as well as event invitations. All received timely responses from the Company’s dedicated personnel.

Stakeholders and Communication Channels in 2016

Stakeholders

Communication Channels

Employees

  • Corporate intranet, internal emails and other announcement channels (such as promotion posters at facilities)
  • Human resource representatives
  • Regular and ad-hoc communication meetings
  • Employee voice channels, such as immediate response system, employee opinion box, wellness center, wellness website, etc.
  • Ombudsman System
  • Audit Committee Whistleblower System

Shareholders & Investors

  • Annual shareholder meeting
  • Quarterly earnings conference call
  • Investor conferences and meetings
  • Telephone and email responses to investors' questions and feedback collection
  • Annual reports, CSR reports, 20-F filings to US SEC, material announcements to Taiwan Stock Exchange, and corporate news on the Company's website

Customers

  • Annual customer satisfaction survey
  • Customer quarterly business review meetings
  • Customer audits

Suppliers

  • Supplier quarterly business review meetings
  • Supplier questionnaire survey
  • Supplier onsite audits
  • Annual supply chain management forum
  • Supplier ethics code awareness training

Government

  • Official correspondence
  • Meetings (such as communication meetings or public hearings)
  • Communication with government authorities through industry organizations, including the Association of Science Park Industries, Taiwan Semiconductor Industry Association, World Semiconductor Council, and Chinese National Federation of Industries

Society

  • Arts events in the communities
  • Sponsorship of non-profit organizations to support educational projects
  • Professorship endowments and student scholarships at universities
  • Support of non-profit organizations and institutions via monetary and in-kind donation, as well as providing necessary manpower for a good cause
  • Regular visits to National Museum of Science, Hsinchu Veterans Home, St. Teresa Children Center, Hsinchu Gaofeng Botanical Garden, Jacana Ecology Education Park, and other remote schools to provide volunteer services
  • Annual volunteer activities in collaboration with TSMC fabs and divisions

In April, 2016, the Company launched its first Facebook fan page, a newly established two-way communication channel to introduce a variety of CSR activities provided by the TSMC Education and Culture Foundation, TSMC Volunteer Program and 17 fab/division volunteer initiatives on a weekly basis. This enables further understanding of the Company's social contribution to society.

TSMC believes that maintaining good communication with stakeholders not only helps the Company better understand economic, social and environmental challenges, but also creates value for the Company and society and promotes sustainable growth.

Responsibilities of TSMC CSR Committee Members

Committee Members

Responsibilities

Stakeholders

Legal

Corporate Governance, Code of Conduct, Legal Compliance, Intellectual Property, Protection of Confidential Information

Government
Employees
Society

Customer Service

Customers Service and Satisfaction, Customer Trust, Customer Confidentiality

Customers

Materials Management

Materials and Supply Chain Risk Management, Supplier Management, Conflict Minerals, EICC

Suppliers

Quality and Reliability

Product Quality and Reliability, Product Recall Mechanism.

Customers

Research and Development

Innovation Management, Green Products

Employees
Customers

Risk Management

Risk Management, Crisis Management, Emergency Response and Action Plan

Customers
Employees
Government
Society
Investors

Finance

Financial Disclosure, Dividend Policy, Tax Strategy

Government
Investors

Investor Relations

Resolving Issues of Stakeholder Concern, Establishing Trusting Long-term Relationships, Effective Two-way
Communication, Annual Report Production

Investors

Operations

Operational Eco-efficiency, Pollution Prevention, Water Resource Risk Management, Green Manufacturing

Customers
Investors

Environment, Health, and Safety

Environmental Policy and Management System, Climate Change Mitigation and Adaption, Pollution Prevention, Energy Consumption Efficiency, Carbon Emissions and Carbon Rights Management, Product Environmental Responsibility, Response Mechanism for Environmental Issues, Environmental Spending, Green Supply Chain, Policy and Management Systems for Occupational Health and Safety, Workplace Health and Safety, Occupational Disease Prevention and Health Promotion, Communication of ESH Regulations

Employees
Customers
Government
Society
Suppliers
Investors

Human Resources

Talent Recruitment and Retention, Employee Health and Safety, Employee Training and Development, Compensation and Benefits, Freedom of Association and Collective Bargaining, Labor Relations and Whistleblower Procedures, Labor Rights Violations and Reporting Procedures, Management of Working Hours, Child Labor

Employees

TSMC Education and Culture Foundation, TSMC
Volunteer Society

Corporate Citizenship, Philanthropy, Community Relations

Society

Public Relations

Stakeholder Engagement, Mechanism for Reflecting Issues of Social Concern, Media Relations

Society

As the only semiconductor company chosen for the Dow Jones Sustainability World Indices for the past 16 consecutive years, TSMC believes that integrity is fundamental to any company’s sustainability. From a CSR perspective, TSMC also believes that customer trust is enhanced if the Company follows the law, insists on transparency and shows good corporate governance. These practices, along with outstanding business results, mean investors will be more willing to invest in the Company over the long term and employees will be more likely to make a mutual commitment to the Company to fulfill its core values, leading to stronger coherence within the Company. At TSMC’s urging, suppliers – both upstream and downstream – have been working together to strengthen environmental protection by building a green supply chain. With the engagement of all stakeholders, the Company’s resources can be amplified to create even more value for society. In summary, carrying out TSMC’s social responsibilities gives the Company greater competitive advantage and benefits all stakeholders.

2016 CSR Awards and Recognitions

Category

Organization

Awards and Recognitions

Overall CSR

Dow Jones
 Sustainability Indices
 (DJSI)

  • Membership in the Dow Jones Sustainability World Index for the 16th consecutive year
  • RobecoSAM Sustainability Award - Gold Class

MSCI Global
 Sustainability Indexes

  • Selected as MSCI Global Sustainability Indexes component

FTSE4Good Index

  • Selected as FTSE4Good Emerging Index component

Goldman Sachs, GS
 Sustain

  • Selected as GS SUSTAIN Focus List companies, which incorporates global industry leaders

R.O.C. Presidential
 Office

  • R.O.C. Presidential Innovation Award

Taiwan Institute of
 Sustainable Energy

  • Taiwan Corporate Sustainability Awards:
  • Taiwan Corporate Sustainability Awards No.1 for Domestic Corporates
  • Taiwan Top 50 Corporate Responsibility Report Awards – Electronics Industry – Gold Class
  • Sustainable Water Management Award
  • Climate Leader Award

Barron's

  • Selected as Top100 World’s Most Admired Companies

FORTUNE

  • Selected as one of The World’s Most Admired Companies

Newsweek

  • Selected as Newsweek Green Rankings Top Green Companies in the World

Channel NewsAsia

  • Selected as one of the most sustainable corporations in Channel NewsAsia Sustainability Ranking

CommonWealth
 Magazine

  • Excellence in Corporate Social Responsibility Award – Large cap – 2nd Place
  • Most Admired Company in Taiwan for the 21st consecutive year
  • Most admired entrepreneur in Taiwan

Global Views Magazine

Corporate Social Responsibility Award:
  • Technology Industry Group- Model Award

Cheers Magazine

  • Most Admired Company for the New Generation

Economy,
Governance

Taiwan Stock Exchange

  • Ranked in top 5% in Second Corporate Governance Evaluation of Listed Companies

R.O.C. Ministry of
 Economic Affairs
Bureau of Foreign Trade

  • Outstanding Trade Contribution Award

R.O.C. Ministry of
 Economic Affairs Intellectual Property
 Office

  • Ranked No. 1 in Top 100 Patent Filers

PricewaterhouseCoopers

  • Ranked No. 1 in Taiwan by PricewaterhouseCoopers Global Innovation 1000 Study

China Credit Information
 Service

  • Ranked No. 1 in Profitability of large Taiwan Companies

Institutional Investor
 Magazine

  • Best CEO (Technology/Semiconductor) - 1st Place (buy-side and sell-side)- All-Asia
  • Best CEO (Technology/Semiconductor) - 1st Place (buy-side)- All-Asia
  • Best CEO (Technology/Semiconductor) - 1st Place (sell-side)- All-Asia
  • Best CFO (Technology/Semiconductor) - 1st Place (buy-side and sell-side)- All-Asia
  • Best CFO (Technology/Semiconductor) - 1st Place (buy-side)- All-Asia
  • Best CFO (Technology/Semiconductor) - 2nd Place (sell-side)- All-Asia
  • Best Investor Relations (Technology/Semiconductor) - 1st Place (buy-side and sell-side)- All-Asia
  • Best Investor Relations (Technology/Semiconductor) - 1st Place (buy-side)- All-Asia
  • Best Investor Relations (Technology/Semiconductor) - 1st Place (sell-side)- All-Asia
  • Best Investor Relations Professional (Technology/Semiconductor) - 1st Place (buy-side and sell-side)- All-Asia
  • Best Investor Relations Professional (Technology/Semiconductor) - 1st Place (buy-side)- All-Asia
  • Best Investor Relations Professional (Technology/Semiconductor) - 1st Place (sell-side)- All-Asia
  • Best Analyst Days (Technology/Semiconductor) - 1st Place (buy-side and sell-side)- All-Asia
  • Best Website (Technology/Semiconductor) - 1st Place (buy-side and sell-side)- All-Asia

IR Magazine

  • Global Top 50 Gold Rank No. 1
  • Global Top IRO - Five Winning IROs
  • Global Top Corporate Governance - Five Winning Companies
  • Best Use of Technology - Greater Asia
  • Best Corporate Governance - Greater Asia
  • Best in Sector: Technology - Greater Asia

Asiamoney

  • Best Managed Company Large Cap in Taiwan

FinanceAsia

  •   FinanceAsia20th Anniversary Platinum Awards: Best Company – in Taiwan

FORTUNE

  • Selected as member of Fortune Global 500

Forbes

  • Forbes Global 2000

Forbes Asia

  • Fabulous 50

Nikkei

  • Nikkei Asia 300 Indexes

World Export Controls
 Review (WorldECR
 Journal)

  •  Best Export Controls Compliance Team of the Year - Rest of the World

Environment,
 Safety and
 Health

U.S. Green Building
 Council Leadership in
 Energy and
 Environmental Design
 (LEED) certification

  • "Gold" class certification–Fab 14B Manufacturing Facility and Office Building

R.O.C. Ministry of the
 Interior “Ecology,
 Energy Saving, Waste
 Reduction and Health
 (EEWH)” certification

  • "Diamond" class certification–Fab 12A Manufacturing Facility, Fab 12 Phase 6 Manufacturing Facility,  Fab 14B Manufacturing Facility

R.O.C. Environmental
 Protection
 Administration

  • Excellence in Toxic Substance Management Award–Fab 2 and Fab 5
  • Enterprise Green Procurement Award–Fab 2 and Fab 5, Fab 3, Fab 8, Fab 12A, Fab 14A, Fab 14B
  • Environmental Education Award–Fab 6、Fab 15A

R.O.C. Ministry of
 Economic Affairs

  • Excellence in Energy Conservation–Fab 12 Phase 6
  • Excellence in Carbon Reduction Award–Fab 2 and Fab 5, Fab 8
  • Green Factory Label–Fab 15A
  • Water Conservation Award–Fab 14B for two consecutive years

R.O.C. Ministry of Labor

  • Excellence in Labor Safety and Hygiene Award–Fab 12A

Hsinchu Science Park
 Administration

  • Water Conservation Award–Fab 2 and Fab 5
  • Excellence in Energy Conservation–Fab 2 and Fab 5, Fab 3
  • Excellence in Labor Safety and Hygiene Award–Fab 2 and Fab 5
  • Excellence in Ammonia Nitrogen Reduction in Wastewater–Fab 12A, Fab 12 Phase 7

Central Taiwan Science
 Park Administration

  • Excellence in Labor Safety and Hygiene Award–Fab 15A

Southern Taiwan
 Science Park
 Administration

  • Excellence in Environmental Protection–Fab 6

Hsinchu County
 Environmental
 Protection Bureau

  • Enterprise Environmental Protection Evaluation–Fab 12 Phase 6

Hsinchu City
 Environmental
 Protection Bureau

  • Enterprise Green Procurement Award– Fab8, Fab 12A

Tainan City
 Environmental
 Protection Bureau

  • Enterprise Green Procurement Award– Fab 14A