Materiality Analysis
Materiality Analysis
A materiality analysis is conducted by Compal every year, in accordance with the GRI Standards and the AA 1000 standards. This process includes four key stages: organizational context assessment, identification of actual and potential impacts, ranking of significant impacts, and definition of impact scope. Through this complete evaluation mechanism, we can effectively identify the Company's material sustainability topics and determine the scope of information disclosure.
The Headquarters ultimately identified nine material sustainability topics for the 2024 ESG report and the basis for the setting of long-term targets including:
1.Customer Relationship
2.Sustainable Supply Chain
3.Occupational Safety and Health
4.Sustainable Products
5.Privacy and Information Security
6.Talent Attraction and Retention
7.Talent Development
8.Climate Strategy
9.Diversity and Inclusion
Compal's materiality analysis process was independently verified by SGS Taiwan Ltd. using the AA 1000 ASv3 standard to ensure its reliability and completeness.
Compal collects sustainability issues through multiple channel. Industry-specific sustainability topics with the potential for financial materiality through the TDCC IR Platform of the Taiwan Depository & Clearing Corporation (TDCC). International sustainability rankings including but not limited to S&P CSA (DJSI), CDP, FTSES, Sustainalytics, and MSCI were also used as a reference. Internal analysis is conducted through regular or ad hoc sustainability meetings that combine the Company’s sustainability strategy and targets with stakeholder interactions. After referring to the practices of domestic and foreign peers, a total of 22 key sustainability topics were ultimately identified.
Materiality Analysis Steps
(The complete steps and procedures can be found on pages 28–30 of the Sustainability Report.)
Material Topics and Value Chain Impact & Material Sustainability Issue Analysis Matrix
Material Sustainability Issue Analysis Matrix and Ranking
Material Issues and Risk Management
(For the complete risk assessment and mitigation measures, please refer to pages 34–39 of the Sustainability Report.)
Sustainability Impact
In 2024, Compal adopted the “Impact Measurement and Valuation (IMV)” methodology for the first time. Through an “outside-in” perspective, it comprehensively examines the impact of the value chain on human well-being, from upstream supply chains and production operations to downstream products and services. The causality-driven “Sustainability Impact Pathway” analysis covers the intersection of economic, environmental, and social issues. Based on the “Profit and Loss (P&L)” management perspective, the externalities of costs (negative) or benefits (positive) are incorporated and converted into a consistent monetary language, and a sustainability impact management framework is established, grounded in the “Triple Bottom Line (TBL)”. The analysis results show that in 2024, Compal’s value chain activities generated NT$2.2 trillion in positive benefits and NT$32.9 billion in negative costs. The impacts of management effectiveness are the most significant in the following areas: sustainable supply chains, customer relationships, sustainable products, climate strategy, energy management, talent attraction and retention, and talent development.
As for company operations, Compal generated NT$910.3 billion in operating revenue, with taxes paid, dividends distributed, employee compensation, R&D investment, interest expenses, depreciation, and amortization, totaling NT$57.8 billion. This not only brings positive impacts to stakeholders but also promotes socioeconomic growth. While focusing on core operations, resource consumption and pollutant outputs result in NT$310 million in external costs to socioeconomic systems, human health, and ecosystems. However, investments in renewable energy create NT$210 million in environmental benefits. Additionally, robust training programs facilitate employee skill development and employability, generating NT$120 million in future career benefits. Occupational accidents cause physical/mental impacts and medical expenses, incurring NT$4.95 million in social costs. Health risks from work overload may lead to NT$14.27 million in social costs, but diverse health education activities and long-term tracking help manage employee health, yielding NT$3.69 million in positive benefits. Investments in social care programs and volunteer activities create NT$45.57 million in social value.
In the supply chain, Compal’s procurement needs lead to NT$5.163 trillion in supply chain output, creating over 45,000 jobs and NT$15.6 billion in wage income for supply chain workers. However, the environmental footprint and resource consumption from raw material and service supply processes generate NT$6.5 billion in environmental external costs. In products and services, Compal’s personal computers and smart devices contribute NT$1.6 trillion in output value for customer industries. Energy consumption during product use and disposal creates NT$26 billion in social cost of carbon, but energy-efficient designs and recycled material use create NT$1.5 billion in environmental benefits, helping customers achieve goals, thus fostering mutual growth.
Through an impact-focused mindset, Compal recognizes that while pursuing business growth brings financial gains and enhances well-being, it may negatively impact society and the environment. This approach helps the Company consider broader, long-term impacts in decision-making, thereby identifying risks and opportunities in sustainability management for future development. Compal is taking more sustainable, innovative, and ambitious actions, striving to achieve a positive impact through corporate sustainability. By leveraging our core technologies and collaborating with stakeholders, we aim to forge a mutually beneficial partnership between the Company and society.
Material Issues and metrics for Enterprise Value Creation
To understand the impact of Compal's material issues on business operations and long-term value, the following presents the material issues of "Privacy and Information Security," " Sustainable Products," and "Supply Chain Management" in terms of their business significance, strategies, and an explanation of target setting and progress.
Material Issues for External Stakeholders
To understand the positive and negative impacts of Compal's material topics on external stakeholders, the following analyzes the impact of the two material topics, " Sustainable Products" and "Supply Chain Management," on external stakeholders and conducts an impact valuation.