Faced with an ever-changing industry and technology, businesses must seek active innovation in order sustain operation over the long term. We have come to realize that greater consumption and exploitation of resources does not provide long-term competitive advantage. When the society, market and nature impose additional costs on every bit of energy and natural resource we use, we must seek green solutions in everything we do and find ways to use green to our advantage. For this reason, we actively respond to risks arising from climate change and try to prevent it from affecting our operations or causing losses.
◆ Environmental Management System
In order to develop control over operational challenges caused by climate change, Compal has been taking steps toward establishment and implementation of an environmental management system, starting with quantitative measurements. Standards including ISO 14001, ISO 14064-1, OHSAS 18001 and IECQ QC080000 have been adopted to facilitate effective tracking of environmental performance.
Impact, adjustment, and mitigation of climate change have become one of the most important environmental issues around the world. In order to build up Compal's green practices, it is necessary to first understand the adequacy of the Company's existing environmental actions before taking steps to improve from the inside out and achieve sustainability.
◆ Greenhouse Gas Management Goals and Progress
Compal has set its greenhouse gas management target to reduce emissions per million dollars of revenues (NTD) by 10%, as compared to the baseline year (2014), before 2030. Compal conducts greenhouse gas surveys on a yearly basis, and strives to reduce greenhouse gas emissions by achieving lower energy usage and higher energy efficiency, as compared to the previous year.
We began greenhouse gas surveys (scopes 1 and 2) and carbon footprint assessments as early as 2010, ahead of all industry peers. The scope of greenhouse gas survey has since been expanded to scope 3. In 2016, Compal became an official participant of "Science-Based Target," a new initiative proposed by members of CDP and United Nations Global Compact, WWF (World Wide Fund for Nature), and WRI (World Resources Institute). The purpose of "Science-Based Target" is to set emission reduction goals based on scientific methods in hope of preventing the Earth's temperature from rising 2 degrees Celsius. This initiative has so far gained the support of 224 businesses from around the world.
The following table shows the progress that Compal has made with respect to greenhouse gas survey:
Validation of Greenhouse Gas Survey
Scope 1 and Scope 2 Emission
Compal has been conducting greenhouse gas surveys in accordance with ISO14064 and seeking external assurance for Taiwanese and Chinese plants since 2010.
Greenhouse gas emission trend (2014~2016)
Founded voluntarily by private institutional investors, CDP (Carbon Disclosure Project) is a UK organization that aims to help publicly listed companies worldwide manage and respond to climate change through the use of systematic questionnaires. Since it was first founded in 2003, the CDP has gathered signed commitment and support from 827 institutional investors worldwide, representing US$100 trillion of assets under management. In 2016, 115 Taiwanese businesses were invited to complete the questionnaire, of which 64 (56%) had replied.
CDP exists mainly to help companies address climate changes. It does so by assessing a company's carbon emission, reduction progress, compliance risks, and exposure to physical risks such as: supply disruption, shortage of resources, extreme weather, rising sea levels, diseases etc. Once identified, risks can then be mitigated or even turned into opportunities to ensure a company's sustainability.
Before 2016, the CDP scoring system comprised two main parts: Disclosure and Performance. Climate Disclosure Leadership Index (CDLI) and Climate Performance Leadership Index (CPLI) were created to identify businesses that deliver outstanding questionnaire replies. Disclosure score is rated within the range of 0-100, while performance score is graded from A to E. Only businesses with grade A rating can be selected for CPLI. From 2016, CDP no longer distinguishes score between disclosure and performance, but simply awards an overall rating from A to D-. Businesses that refuse to complete the questionnaire or disclose too little information are given an F rating.
In 2016, Compal attained an overall grade of B and was rated Management, which is a good representation of Compal's continuous efforts on this issue.
CDP exists mainly to help companies address climate changes. It does so by assessing a company's carbon emissions, reduction progress, compliance risks, and exposure to physical risks such as: supply disruption, shortage of resources, extreme weather, rising sea levels, diseases etc. Once identified, risks can then be mitigated or even turned into opportunities to ensure a company's sustainability.
Greenhouse Gas Reduction
Scope 1 and scope 2 reduction
Compal is devoted to reducing greenhouse gas emissions, for which it has actively implemented energy-saving solutions at all plant sites. Due to a series of production line and operational adjustments undertaken in 2016, the Company experienced a 3.09% decrease in the energy intensity of electricity (million joules/per NT$100-million revenue), a 13.31% increase in the energy intensity of diesel, an 81.24% increase in the energy intensity of gasoline, a 24.24% increase in the energy intensity of LPG, and a 12.04% increase in the energy intensity of natural gas. We will continue to manage and track usage for all types of energy, and implement goals and measures to ensure effective control and reduction of greenhouse gases.
There are two main focuses to the energy conservation plans adopted by our plants: equipment improvement and process enhancement. Each plant has been assigned dedicated personnel to perform duties such as plan execution, estimation of energy savings, and promotion of employee awareness. Below is a list of projects executed in 2016 and energy performance achieved:
Scope 3 reduction
With reference to GHG Protocol Corporate Value Chain (Scope 3), Compal has identified scope 3 emissions based on its operational characteristics and product features, and devised corresponding reduction solutions.
Extreme weather conditions caused by global warming and climate change have caused significant impact to the world and Taiwan and posed unprecedented challenges to mankind. One of the solutions to climate change is "Mitigation," which involves reducing energy, carbon and greenhouse gases from a personal capacity to adopting low-carbon economy and energy transformation. Apart from "Mitigation," we must also begin "Adaptation" since climate change is inevitable. Adaptation applies not only to individuals, but to corporations as well, for it is important for companies to minimize business risks caused by extreme weather, which would require extensive and thorough risk assessments.
Increasing intensity and frequency of extreme weather combined with the melting of ice caps and rising sea level may cause impacts such as: drought, heat wave, excessive rain, tidal wave, landslide, Typhoon, change of ecosystem, change of terrain, land subsidence, coastal flood, degraded air and water quality etc. Should any of the above extreme weathers occur, Compal may be rendered unable to ship products in time or at all, and suffer severe losses as a result. In view of the potential impacts, Compal has devised the following adaptation strategies based on the characteristics of its operations located throughout the world: