Environment

Climate change and energy management are vital for PHIHONG's sustainable development. We analyze, control, and reduce greenhouse gas emissions annually by 4.2%, striving for net zero emissions by 2050 to actively combat climate change.

Climate Change Risks and Opportunities

PHIHONG follows the Climate Related Financial Disclosures (TCFD) proposal and conducts comprehensive climate risk management from four perspectives: governance, strategy, risk management, and indicators and targets. Firstly, we identify potential significant risks, evaluate the financial impact path and impact scale under different scenarios for each risk factor, take stock of countermeasures, and set targets for regular monitoring and tracking.

We have listed the main climate change transformation risks, physical risks, opportunities, financial impacts and responses in 2023 as follows:

Impact events / Regulatory or agreement requirements
Risk TypePotential Financial RiskOpportunity TypePotential Financial Opportunities
Transformation Risk
- Compulsory Acts, Agreements
- Technology risk
Laws, policies, reduction targets:
-2050 net zero emission
-Corporate governance 3.0
Improve corporate resilienceImprove the company's ESG performance and market investment value
Management Measures and Actions
- Introduce energy management system and construct solar power generation facilities. Self-owned factory roofs to build solar power generation facilities, the onstructing solar power facilities on the rooftops of our own factories, with Dongguan Phihong's 2,000KWp facility officially operational in 2023.
- Construct TCFD system and continuously manages short, medium & long-term ESG performance (ESG report) on a rolling basis.
- Actively cooperate with the FSC to strengthen corporate governance.
- Response and disclosure of sustainability disclosure indicators in "Taiwan Stock Exchange Corporation Rules Governing the Preparation and Filing of Sustainability Reports by TWSE Listed Companies".
Impact events / Supply disruption
Risk TypePotential Financial RiskOpportunity TypePotential Financial Opportunities
Physical risk
- Immediate / longterm
Supply Chain Management: Suspension of Raw Material Supplies, Increased Sustainable Energy Costs in the Supply Chain
Resilience - supply chain risk reduction
Improve supply chain reliability and response resilience
Management Measures and Actions
Introduce BCM Management
Impact events / Changing market preferences
Risk TypePotential Financial RiskOpportunity TypePotential Financial Opportunities
Transformation Risk
- Market
- Technology
Changing Market Preferences:
Customer Demands for Green Design
- Increase revenue
- Increase market
share
Raise customer trust,
competitiveness and operating income
Management Measures and Actions
Raise the cost of green product development.
Impact events / Increased severity of extreme weather events such as typhoons and floods
Risk TypePotential Financial RiskOpportunity TypeManagement Measures and Actions
Physical risk
- Immediate / longterm
Impact of extreme weather events: extreme weather, heavy rainfall, typhoons, etc. cause flooding
Improving the resilience of our own and the supply chain
Insure against related disasters.
Impact events / Average temperature rise
Risk TypePotential Financial RiskManagement Measures and Actions
Physical risk
- Immediate / longterm
Impact of high temperature: Due to high temperature, the demand for air conditioning in offices and factories increases, which increases power consumption
- Introduce an energy management system, namely energy monitoring system, to improve electricity consumption efficiency.
- Update energy equipment to improve energy efficiency.
Impact events / Rainfall (water) pattern changes and climate patterns
Risk TypePotential Financial RiskManagement Measures and Actions
Physical risk
- Immediate / longterm
Extreme weather causes drought
No production process uses water, minimal impact. Purchase of drinking water and air conditioning water supply
Impact events / Sea level rise
Risk TypePotential Financial RiskManagement Measures and Actions
physical risk
- Immediate / longterm
Flooding caused by sea level riseInsure again related disaster risks