TSMC Supplier Transportation Management Makes Traffic Safer

Improving sustainability risk management is a key strategy for TSMC to fulfill its supply chain responsibility. In order to strengthen the transportation safety of its supply chain and ensure stable supply of materials and services, TSMC took the lead in 2021 by publishing the Taiwan semiconductor industry’s first "Supplier Transportation Management White Paper", which includes four major management measures: setting regulations, requiring signatures, conducting audits for improvement, and training. After three years, TSMC achieved a 100% signing rate for compliance by suppliers in 2023, exceeding the annual target. The accident rate decreased 67% and the violation rate decreased 45%, establishing a safer road environment and workplace.

Launch Investigation Plan to Verify Effectiveness of White Paper Implementation

Each year, trucks carrying raw materials and nine major types of potentially hazardous materials for TSMC make a total of about 400,000 trips. TSMC requires suppliers to follow the "Supplier Transportation Management White Paper" and sign a compliance statement to ensure regulations are followed. In order to assess the effectiveness of white paper implementation and set a reference for future improvement, TSMC launched the "Supplier Transportation Management Investigation Plan" in 2023 to collect data on suppliers’ violation/accident rates and trips from 2021 to the second quarter of 2023, the number of violations decreased from 87 cases in 2021 to 48 cases in 2023, and the accidents also decreased from 9 cases in 2021 to 3 cases in 2023. It can be seen that the introduction of the White Paper has indeed significantly improved road traffic safety. TSMC continues to track and verify compliance with the key items in the white paper to help suppliers enhance sustainable risk management, create a safer transportation environment for supply chain, and fulfill social responsibility together.

The Three Major Categories of On-site Audits to Strengthen Transportation Management

To help suppliers continuously improve their transportation management, TSMC's internal expert team conducts on-site audits in three major categories: vehicle hardware, transportation management, management system. The team identifies potential risks and opportunities and requires suppliers to propose improvement plans and schedules. As of 2023, TSMC has conducted 48 lorry audits, with 100% completion rate for the implementation of 169 improvement projects. The installation of driving safety equipment has included systems for monitoring distance, speed, and monitor cameras. In addition, TSMC has created an online interactive course for the "Supplier Transportation Management White Paper" through the Supply Online 360 platform. After being available online for one year, the course has accumulated over 30,000 views, encouraging suppliers to comply with regulations to maintain transportation safety by expanding promotion.

Bearing in mind our principle of improving supply chain sustainability, TSMC requires all suppliers to sign a white paper compliance statement and makes rolling updates according to traffic laws and regulations. By promoting the four major management measures to strengthen road transportation safety, we continue to decrease the violation and accident rate, and establish a responsible operating model for the environment and society.