Identification of Material Issues

       In 2016, Compal made significant changes to the materiality questionnaire used for the 2015 CSR report. These changes marked a turning point in the Company's CSR practice, because not only did we broaden the issues discussed, we also set sustainable goals to guide our efforts. We know that these changes cannot be completed over a short term, which is why we have carried forward the changes made in 2016 and adopted the same material issues identified in the previous year, hoping to make further improvements in the next 2 years. An editorial team assembled by CSR Office (consisting of representatives from CSR Office, green task force, sales, procurement, human resource, and factory affairs) was assigned to review last year's materials one by one, and to determine the level of stakeholders' concern from 4 different perspectives: local/foreign trends, common issue of the electronics industry, Compal's operating focus, and our CSR goals and policies. An issue would be given one point if it is currently discussed by a local/foreign organization or media, or is part of a government policy. These underscored issues are then reviewed for commonality in the electronics industry, relevance to Compal's operations, and congruency with Compal's CSR goals. Issues are chosen for the report based on the sum of scores and levels of stakeholders' concern (maximum 4 points). Based on discussions with each stakeholder group, the core team once again verified whether the identified issues were a comprehensive representation of stakeholders' concerns and after a series of discussions and confirmation, a total of 27 issues were considered material to Compal in 2016.
        After ranking them by levels of stakeholders' concern, the core team then discussed the level of impact each issue has on Compal (low, medium or high), and plotted them on a materiality matrix against levels of stakeholders' concern. The materiality matrix was then discussed among the core team and a decision was made to include all issues with stakeholders' level of concern at 4 or are of high impact to Compal as material issues of the 2016 report.
        These material issues were presented to Compal's CSR Committee for review and after approval was given by the chief committee, they officially became the material issues discussed in Compal's 2016 CSR report. The Company plans to organize a new round of stakeholder surveys in 2018.