Environmental Protection Management Policy
Arcadyan deeply understands the limited resources of the earth and the importance of sustainable development, declares to implement environmental safety, energy and product ecological design management system, and integrates it into business activities. Arcadyan conducts risk assessments on a regular basis and establishes an emergency response system. We promises to implement environmental safety and sanitation, energy management, and product ecological design, and to continue to improve in order to achieve the goal of sustainable development. Formulate environmental safety and health energy and product ecological design policies:
- Comply with domestic environmental safety and health regulations and effectively implement the environmental safety and health management system.
- All staff participate in product ecological design, environmental protection and energy management, and promote continuous improvement for sustainability.
- Improve resource recycling and energy efficiency, and reduce the impact of carbon emissions in supply chain.
- Promote education and publicity on environmental safety, energy and product eco-design.
- Implement employee health management, proactively prevent occupational disasters, and create a safe workplace with zero disasters.
TCFD Climate-Related Financial Disclosure Executive Summary
Arcadyan cares about global environmental changes. In order to specifically present the impact of climate change on enterprises, the proposed framework issued by Task Force on Climate-related Disclosure (TCFD) is adopted, which includes four core elements of Governance, Strategy, Risk Management, Metrics and Targets.
Climate Change Risk Identification
The rise in global temperature and extreme weather caused by climate change will affect the normal operation and production activities of enterprises, resulting in impacts including property losses or threats to labor health and safety. Arcadyan has followed the Task Force on Climate- Related Financial Disclosures (TCFD) framework, which discloses information on the four core elements of governance, strategy, risk management, metrics and targets, and explains related implementation methods, strategies, and results. 2022 Arcadyan Carbon Management Committee conducted information collection and discussion in groups to identify the impact (severity) and possibility (occurrence) of potential climate risks related to climate change issues, and formulate management strategies for major climate risks. And through scenario analysis, risks and opportunities are quantified as financial impacts, which serve as the basis for planning and preparing for relevant response measures, and strengthen the Arcadyan's ability to adapt to climate change.
Arcadyan Carbon Management Committee assesses the degree of impact and the possibility of occurrence of climate change-related opportunities and risk, and screens out the eight sources with the highest risks and opportunities, namely "O1:R&D and innovation of new products (Opportunities)", "O2:Develop low-carbon products and services (opportunities), "O3: Develop new technology (opportunities)", "O4: Diversification of Business Operation Models (opportunities)", "O5: Improve Resource Usage Efficiency (opportunities)", "O6: Use Recycled Materials (opportunities)", "O8: Use low-carbon Energy (opportunity)" and "R6: Raw Material Cost Increase (risk)" and further assess its financial impact and formulate corresponding management practices and measures.
Climate Change Risks/Opportunities and Strategies
Greenhouse Gas Management
Arcadyan always concerned about global environmental changes, including relevant agreements actively promoted by various countries, such as the Kyoto Protocol, the United Nations Framework Convention on Climate Change (UNFCCC), the Paris Agreement, and Product energy-saving requirements of United Nations treaties and other regulations. Arcadyan has actively participated in the Carbon Disclosure Project (CDP*) since 2009, in order to reduce the risk and cost of business operations, and further convert various risks into circular economy business opportunities to improve the sustainability of business operations.
2022 Arcadyan joined the Science-Based Target Initiatives (SBTi), signed the SBTi Carbon Reduction Commitment Letter, joined the Business Ambition for 1.5°C campaign member, and expanded the scope of inventory of greenhouse gases. The category of scope3 emission hotspots has been included in the management, and the investigation of product carbon footprints of key suppliers has begun. In September 2022, Arcadyan and PwC Sustainability Services Company signed a carbon reduction project contract to carry out a two-year carbon management strategy course project. Referring to the carbon reduction path of the IPCC "Global Warming 1.5 Degrees Celsius Special Report", Arcadyan will set a carbon reduction plan to meet the control of temperature rise of 1.5 degrees, and submit the carbon reduction target to SBTi for validation by the end of 2023. The history of GHG-related management measures over the years is shown in the figure below:
Greenhouse Gas Management Organization
In response to the global net zero carbon emission target, and committed to controlling the global temperature rise within 1.5 degrees. Arcadyan promises to achieve net zero emissions in key operating bases by 2040~2050. In addition to joining the Science-Based Reduction Target Initiative (SBTi), Arcadyan Sustainable Development Committee established a carbon management organization, and a special team composed of relevant departments is responsible for realizing the company's commitment to greenhouse gas emission reduction, and formulating financial budgets for practicing greenhouse gas emission reduction management, and linking the team's performance compensation to emission reduction goals.
Greenhouse Gas Management Strategy and Targets
Arcadyan has joined the Science-Based Reduction Targets Initiative (SBTi) in 2022 to assess the impact of future climate change with reference to the 1.5-degree warming scenario released by the International Energy Agency, and formulate the corresponding SBT scientific-based greenhouse gas reduction targets. Sets 2022 as the base year, declaring that the organization's greenhouse gas (Scope 1+2) will achieve net zero by 2040. Other indirect emissions of greenhouse gases (scope 3) are planned to achieve net zero by 2050.
Arcadyan’s climate change response strategy includes the introduction of ISO 50001 energy management system, strengthening the utilization rate of renewable energy, developing low-carbon products, introducing low-carbon transportation routes, and low-carbon supply chains to implement greenhouse gas reduction and mitigate the impact of climate change.
2022 Arcadyan’s carbon emission intensity (per unit product weight) is 0.538 CO2e/Kg, which is about 18% lower than the carbon emission intensity of 0.657 CO2e/Kg in 2021, better than the 1% reduction target set in 2021. Arcadyan greatly shortened the timetable for low-carbon introduction planning. First, we introduced the ISO 50001 energy management system at headquarters in Hsinchu to improve the energy efficiency and serve as an ISO 50001 energy management demonstration plant. AVC Vietnam Production Center is expected to complete the ISO 50001 management system setup and obtain external certification in 2023. In June 2022, the Vietnam production center has launched the solar photovoltaic system, which has obtained external verification from SGS. At the same time, we have also evaluated the purchase of renewable energy certificates to increase the utilization rate of renewable energy, and is committed to continuously reducing energy consumption and improving energy efficiency.
2022 Greenhouse Gas Inventory
The greenhouse gas emissions in 2022 have been inventory according to the ISO 14064-1:2018 standard, and Arcadyan adopts the operational control approach to conduct greenhouse gas inventory on important operating locations. In addition to the greenhouse gas emissions from our own operations, starting from 2022 we will carry out a comprehensive inventory of 15 categories in Scope 3 and third-party verification every year, and extending Arcadyan's carbon management to value chain partners hotspots emissions.
For Scope 3 other indirect emissions in 2022, Arcadyan has conducted an inventory based on the all 15 categories. The three major emissions of "Category 1: Purchased Goods and Services", "Category 3: Fuel and Energy-related Activities", "Category 9: Downstream transportation & distribution" and "Category 11: Use of Sold Product". These four major emissions have accounted for more than 90% of the total greenhouse gas emissions of Arcadyan Group. Therefore third-party verification agency will verify the previous three major emission categories, and set corresponding carbon reduction targets. The other scope 3 categories are not activities that belong to the emission hotspots of Arcadyan Group, and external verification will not be conducted for the time being.
Biodiversity
Arcayan uses a green roof design concept to place vegetation on the top floor to reduce solar radiation heat and carbon dioxide, lowering the indoor temperature on the roof by 3 to 5 degrees, thereby reducing the use of air conditioning.
The COP15 United Nations Biodiversity Conference to be held in 2022 pointed out that companies must begin to measure the biodiversity risks they face in order to promote sustainable development. In response to customer requirements, Arcadyan conducts life cycle assessment (LCA) for products through evaluation software, covering climate change, human toxicity, freshwater eco-toxicity, and the impact of 28 biodiversity categories such as minerals, fossils, and resource depletion etc., to minimize the impact in the product life cycle.
2022 Arcadyan with the national agricultural science subsidy project to adopt 40 hectares of soil and apply "Straw Decomposition Bacteria Organic Fertilizer". After harvesting the adopted fields, instead of burning straw in the traditional way, use organic fertilizer mixed with decomposition bacteria to decompose the straw, maintain the biodiversity of microorganisms in the soil, and prevent soil acidification. There is no need to apply base fertilizer for the next farming, and keep the soil healthy and resilient, hoping to contribute to the society by promoting sustainable farming. In the future, Arcadyan will also continue to invest in climate action, pay attention to the development of carbon sink technology, conduct carbon swap related assessments, devote more efforts to achieve the goal of carbon neutrality, and support the implementation of sustainable development goals with actions.
Production Center Waste Heat Recovery Device
The waste heat recovery device has been installed in the production center of Arcadyan Vietnam since 2022. The high-temperature and high-pressure gaseous refrigerant is passed through the heat recovery device of the chilled water host, and the normal temperature water is sent to the heat recovery device by a circulating water pump, and the heat exchange with the high-temperature refrigerant steam is sent to air-conditioning box circulates dehumidification to ensure that the constant temperature and humidity of the process are within the monitoring range. It's also expected that after the completion of the staff dormitory in 2023, the air compressor heat recovery mechanism will be introduced, and the waste heat will be used by the dormitory staff for bathing with the same heat exchange principle.
EV Charging Piles Installation
Electric vehicles are an important climate solution, as they have lower lifetime emissons. Arcadyan Taiwan Headquarters installed 4 EV charging piles in 2021. By offering convenient parking and charging, Arcadyan encourages employees to commute with environmentally friendly vehicles thereby reduces scope 3 emissions.
