New Supplier Assessment
Compal’s PCBG Procurement Department required all suppliers to complete the “Supplier Profile”, “Supplier Internal Management Questionnaire”, “Supplier Environmental Management Questionnaire”, and “Supplier RBA Self-assessment Worksheet” and provided documentary proof for ISO certification. Each supplier was assessed for performance on a number of aspects including environment, safety, product liability, human rights, social involvement, etc.
The Procurement Department distinguished suppliers between Type A and Type B. Type A suppliers consisted of foreign manufacturers, locally renowned companies, IC design companies, and suppliers designated by customers, whereas Type B suppliers consisted of local manufacturers.
Type A suppliers were surveyed by way of documentary review. The Procurement Department first consolidates the “Supplier Internal Management Evaluation Worksheet” and then informs R&D, SQE(Supplier Quality Engineer), Quality System/Green Product and Environmental Assessment Departments to verify and approve the worksheet. The approved document was forwarded to the Engineering IT Department, where suppliers were assigned an official ID and included in the “Qualified Suppliers List”.

The suppliers of SDBG needed to pass the economic, social, and environmental evaluation. In accordance with the standards of ISO 9001 suppliers approval or disapproval management procedure, the suppliers in supplier evaluation were distinguished into four types: Type A, B, C, and D. 

A

Foreign Renowned Companies (If having any technical, quality or other problems for type A suppliers, we still can arrange on-site auditing).

B

1. IC Active and Passive Component Manufacturers (need ISO certification) 2. Dealers 3. Plants Located Outside of Taiwan and China

C

1. Taiwan and China Manufacturers 2.Plants Located in Taiwan and China

D

OEM Models Manufacturers Designated by Customer

 The suppliers’ recognition was verified through the “Quality Agreement” and the environmental management assessment was arranged in accordance with “third party management regulations”. The investigation scope was based on ISO 14001 environmental management system and will evaluate suppliers’ environmental policy and implementation. Due to the location, the “Supplier Ethics Management and Green Management Assessment Sheet,” including items of the prohibition of child labor, the prohibition of forced labor, employment policy, ethics management, conflict minerals, and green management system were also added to Type C manufacturers.
 
Supplier Online Assessment and On-site Auditing
For qualified suppliers, Compal continued to introduce green product policies and requirements and recovered supplier product quality introspection questionnaires for first step auditing. Meanwhile, Compal production centers have assembled CSR audit teams since 2009. Using transaction sums and locations to sample different suppliers for factory on-site auditing, the auditing ensured the suppliers correspond to CSR issues in accordance with RBA code of conduct regulations aspect. If the supplier violates any related articles, we will require immediate improvement and trace its improvement condition. If related laws or contract arrangements are touched, the supplier will be responsible for the subscribed items on the contract.
In 2017, Compal’s audit efforts were mainly focused on its production center in Kunshan. 14 suppliers that presented higher transaction sums and higher risks of supply disruption were chosen for the audit; 14 (100%) of which were completed during the year. Each audit finding was classified into 1 of 4 levels: Priority, Major, Minor, and Obs (observation). Priority findings presented a significant and immediate impact on factory operation, which was why Compal requires all suppliers to rectify Priority findings first, in addition to making improvement plans on all other levels of audit findings. The audit found 7 suppliers had Priority defects in the “Labor” and “Safety and Health” aspects, which aim at excessive work hours in a week, the absence of 1 day's break in a 7-day period, and social insurance. Aiming at the defects, Compal required the supplier to improve in time and deliver an improvement report. Every year the Company randomly sampled the high-risk suppliers to be audited to avert labor defects.