TOP
ESG

Sustainable Supply Chain Management

Partner Relationship Management and Sustainable Supply Chain

To enhance the overall supply chain sustainability performance, THSRC has formulated a supply chain management structure with reference to international standards and has continued the Company's implementation and optimization through a five-stage process. In 2023, THSRC launched a sustainable supply chain initiative to strengthen the Company's supplier sustainability management mechanisms, establishing a clear sustainable supply chain management policy. Through supplier risk identification, suppliers from various industries are classified and managed accordingly, with written and on-site audits conducted for medium-risk and high-risk suppliers. During the review process, THSRC actively communicates with suppliers and assists them in enhancing their practices related to environmental protection, occupational health and safety, and labor rights, ensuring that the suppliers not only comply with regulations but also advance toward shared sustainability goals with THSRC.

In 2023, THSRC optimized the "Supply Chain Management Policy" and "Supplier Code of Conduct," integrated the existing "Human Rights Policy" and expanded the scope of policy to all partners. These changes were announced to all suppliers in January 2024. We expect to strengthen domestic suppliers' sustainability through management mechanism. To align with global trends, we incorporated human rights and labor practice, safety and health, and environmental protection into the "Supply Chain Management Policy" and "Supplier Code of Conduct," especially improving suppliers' working conditions, gender equality, grievance mechanisms and labor practice issues.

In 2024, THSRC completed the revision of the supplier self-assessment questionnaire, aligning the topics with the contents of the Supplier Code of Conduct, aiming to collaboratively focus on key sustainability issues with supply chain partners. Over 100 completed questionnaires were collected. Based on the analysis of valid responses, suppliers were classified, and following documentary and on-site audits were conducted for those identified as high-risk. The 2024 on-site audits focused on ethics, human rights and labor, safety and health, and environmental protection. No supplier was found to have major deficiencies, nor was any supplier identified as posing significant potential negative social impact. Looking ahead, THSRC will continue engaging with key suppliers through communication, offering improvement suggestions, setting sustainability management goals, and formulating action plans. Through the five stages of its sustainable supply chain management framework, THSRC aims to gradually enhance the sustainability of Taiwan's rail supply industry and jointly build a sustainable supply chain with the Company's suppliers.

Sustainable Supply Chain Management

Supply Chain Management Policy

Supplier Code of Conduct

Taiwan High Speed Rail Corporation (THSRC) is committed to the highest standards of integrity, environmental and social responsibility and requires all suppliers and business partners to achieve the sustainability commitment collaboratively. The THSRC Supplier Code of Conduct (the “Code”) draws upon international standards and guidelines such as the United Nations Global Compact, Responsible Business Alliance, International Labor Organization Conventions and Global Reporting Initiative, etc. The Code applies to all suppliers/contractors/subcontractors/service providers offering products and services to act in accordance with the Code and with all applicable laws and regulation with the geographies in which they operate, and to be open and cooperative with regulators that enforce such laws. THSRC will periodically evaluate suppliers' compliance with the Code via distributing self- assessment questionnaires as well as conducting on-site audits of suppliers. Suppliers found in violation of the Code may result in suspense or termination its relationship with THSRC.

Business Integrity
  • The highest standards of integrity are to be upheld in all business interactions. Suppliers must eliminate any forms of corruption, extortion, misappropriation, fraud, bribery, insider trading, and reciprocal favors. This includes actions that directly benefit the suppliers or result in gains for their family members, friends, or partners.
  • Suppliers, in their collaboration, negotiation, transaction, and contract execution processes with THSRC, guarantee that all provided documents and information are authentic, with no falsehood, deception, forgery, or alteration.
Fair Trade
  • Suppliers should comply with all applicable law, regulations and international conventions related to fair competition and antitrust.
 
Avoid Conflicts of Interest
  • In their business interactions with THSRC, suppliers should avoid any potential conflicts of interest. Potential conflicts of interest include (but are not limited to) situations where THSRC's employees and/or their family members and associates are employed by the supplier or hold significant investment interests in the supplier (non-publicly traded companies) should be avoided to prevent misconduct.
  • Social contact must be within accepted cultural business norms, and relationships that become conflicts of interest must be reported to THSRC.
  • If a potential conflict is discovered, suppliers should report such incident immediately to THSRC and take corrective actions.
Intellectual Property
  • Intellectual property rights must be respected. Transfer of technology and know-how is to be done in a manner that protects intellectual property rights. Additionally, customers' and suppliers' data and information should be safeguarded.
 
Information Security
  • Information protection measures should be implemented, and the security of information systems and process should be secured, including unauthorized access, use, disclosure, tampering, alteration, viewing, recording, and destruction.
 
Forced Labor and Human Trafficking

Any form of forced labor and human trafficking is strictly prohibited, including using coercion, intimidation, fraud, or taking advantage of someone's vulnerable situation to subject them to slavery, similar practices, forced labor, or work with disproportionate compensation.

  • Unreasonable restrictions on the freedom of movement of workers to enter or exit the workplace are prohibited.
  • Suppliers are not allowed to hold, conceal, or destroy any government- issued identification, passports, work permits, or any other documents required for termination of employment for workers. Documents may only be retained as required by the relevant laws at the worker's location, and workers must not be denied access to their documents.
  • Suppliers are strictly prohibited from engaging in or benefiting from any form of human trafficking, including recruiting, transporting, transferring, harboring, or receiving persons.
Child Labor and Young Worker
  • Employment of children under the age of 15, or the minimum age as stipulated by local laws, is strictly prohibited.
  • Employment of young workers (under the age of 18) should not be engaged in work that is injurious to health or is hazardous, dangerous, or unsuitable, including night shifts or overtime.
Human Rights Protection, Anti-Discrimination, and Prevention of Harassment

Suppliers should uphold core values, support the United Nations Universal Declaration of Human Rights (UDHR) and related international conventions of human rights, while complying with local regulations, treating all employees with dignity and respect. Suppliers should commit to maintaining a workplace free of discrimination and harassment.

  • Discrimination based on race, class, language, thought, religion, political party, place of origin, place of birth, gender, gender orientation, age, marital status, appearance, facial features, disability, horoscope, blood type, or past membership in any labor union is strictly prohibited.
  • Workers should not be subjected to harsh or inhumane treatment, including physical, psychological, verbal, sexual violence, or any other forms of harassment and infringement, inhumane or degrading treatment, corporal punishment, or any form of oppression and bullying, whether through verbal, physical, or written means.
Wages and Benefits

Compensation paid to workers should comply with the relevant laws at the worker's location and the requirements of labor collective agreements to provide workers with minimum wages, overtime pay, and statutory benefits.

  • Deductions from wages as a disciplinary measure is prohibited.
  • Clear and comprehensible employment documents must be provided to all workers, outlining the terms of employment, including work hours, compensation, and payment dates. These documents should be written in a language that local workers can understand.
  • Compensation should be paid on time, and a clear wage statement for each pay period should be provided. These documents should be written in a language that local workers can understand.
Working Hours

Suppliers must ensure that the working hours and overtime hours of their employed workers comply with the relevant laws at the worker's location. Workers who work overtime should be given overtime payment or compensatory time in accordance with the regulations.

 
Freedom of Association and The Right to Collective Bargaining

Suppliers should respect the rights of all workers to form or to join labor or trade unions as well as the right of collective bargaining and the right of avoiding such activities in accordance with local laws.

 
Occupational Safety and Health

Suppliers must comply with the relevant laws and regulations at the worker's location to provide workers with a safe, healthy, and secure working environment, with the aim of achieving zero accidents. Suppliers should appropriately employ internationally recognized risk assessment methods in their safety and health management systems, to control and reduce hazards to the lowest achievable level within reasonable boundaries. Suppliers should make continuous efforts to improve safety performance, regularly review and update safety plans and practices to ensure compliance with legal requirements and industry standards.

Emergency Preparedness

The impact of accidents should be minimized through implementation of emergency response procedures, including training, appropriate fire detection and firefighting equipment, adequate evacuation facilities, emergency response plans, drills, emergency reporting, evacuation, and recovery plans. Suppliers should promptly report any occupational safety and health accidents or any illegal incidents of non-compliance to THSRC.

Occupational Injuries and Occupational Diseases

Procedures and systems should be established to prevent, manage, track, and report occupational injuries and occupational diseases, including provisions to encourage workers to report, classify and record cases of occupational injuries and diseases; provide necessary medical treatment; investigate cases and implement corrective actions to eliminate their causes; facilitate smooth return to work and encourage workers to raise any health and safety concerns, ensuring that they are not subject to retaliation.

Education and Training

Suppliers should provide workers with necessary training and information related to safety and health, including but not limited to mechanical, electrical, chemical, fire, and physical hazards, to ensure that they can perform their daily tasks correctly and safely, and possess an awareness and concern for safety in their work.

Environmental Permits

Suppliers should obtain and maintain all necessary environmental permits, licenses, and registration documents as well as follow the operational and reporting requirements in order to comply with related standards.

Environmental Protection Mechanisms

Effective environmental protection mechanisms should be established to manage environmental issues, plan, and implement programs with environmental improvement performance, conduct inspections of environmental measures, and supervise personnel to ensure that they carry out their work in accordance with the relevant requirements. The inspection results, improvement measures, and effectiveness should be recorded and submitted to THSRC for reference.

Toxic and Concerned Chemical Substances

Toxic and Concerned Chemical Substances should be identified and managed to ensure their safe handling, movement, storage, use, recycling or reuse and disposal. All suppliers should comply with the Toxic and Concerned Chemical Substances Control Act.

Waste and Emissions

During the operational process, compliance with environmental laws and regulations is mandatory. Any wastewater, emissions, and waste generated during the operation must undergo lawful treatment procedures, with consideration for achieving the goal of resource recycling. Responsible disposal or recycling should be practiced.

Enhancing Environmental Performance

In the process of material production and service provision, optimizing resource utilization and efficiency through appropriate processes and resources (such as process enhancements, maintenance and facility procedures, material substitution, reusing, conserving, recycling, or other methods) is essential. This helps to prevent and reduce environmental impacts and minimize energy consumption and greenhouse gas emissions to the utmost.

  • Implementation of Supply Chain Management

  • Additionally, since 2019, bidders have been required to commit to cooperating with THSRC's CSR regulations and sign a CSR commitment. Regular project group meetings are held to review the self-assessment forms of contractors. In 2024, all companies participating in public tenders were required to meet THSRC's CSR commitments, and we collected 116 sustainable supply chain self-assessment questionnaires. Furthermore, a total of 1,176 procurement announcement cases complied with THSRC's anti-corruption regulations. From 2022 to 2024, a total of 17 suppliers were inspected on-site, and the results of the on-site inspections all complied with the inspection item regulations, with no missing records.

  • Ethical Management and Anti-Corruption

  • In view of the fact that suppliers are THSRC's important partners, THSRC introduces the "Supply Chain Management Policy," "Principles of Handling Unusual Conduct Among Manufacturers," "Procurement Regulations" and related specifications with reference to international industrial standards to strengthen sustainable supply chain management, and indicates anti-corruption policies and procedures in the tender instructions to achieve bidding behavior complies with the principles of fairness, justice and openness. Suppliers may require to explain if there is any violation case found and particularly serious thereof may be listed as a prohibited supplier. In 2024, THSRC announced the Supplier Code of Conduct which has incorporated ethics (including business Integrity, fair trade, avoid conflicts of interest and intellectual property and etc.) into the code. There are 1,176 public procurement cases related to anti-corruption policies this year and there are no cases of suppliers' violation of ethical management.

  • Security Management and Training

  • To ensure a highly secure riding environment for both customers and service personnel, THSRC annually commissions security companies to provide professional training for their security staff. The company has also established a security management framework and defined the scope of duties for security personnel. In addition, we have increased communication with these security firms by holding regular bi-monthly meetings to ensure that security personnel comply with THSRC's security management regulations while delivering customer-first service.

    Since 2020, THSRC has recruited individuals with prior experience in military or police special task forces, or those holding certified martial arts licenses, to serve as Train-elite security guards after undergoing professional training—strengthening passenger safety on board. Annual professional training for security staff includes operation of security equipment/systems, emergency notification drills, auxiliary security response training, traffic control command, patrolling techniques, integrated combat/self-defense techniques, and basic recognition of suspicious packages and explosives. In 2024, 100% of security personnel received professional training.