2019 HTC CSR Report

CORPORATE SOCIAL RESPONSIBILITY REPORTHTC Corporation

2019

Mops.twse.com.tw / htc.com / printed on April 21, 2020

Editorial Principle
Thank you for reading the eighth Corporate Social Responsibility (CSR) Report issued by the HTC Corporation(HTC). HTC has an open and honest approach to the review and disclosure of our executive performance related
to all CSR matters and offers our stakeholders a clear picture of all the related issues. Our aim is to use our brand’s
influence to integrate our CSR strategies into the organization, and we start off with a comprehensive response to allthese issues.
As a global mobile-device brand, we are ready to confront all the challenges that might present themselves. For eachmajor CSR issue that relates to our future development, we make it clear at the beginning of each section whichchallenge we are facing, our current achievements, and our goals for future development.
By understanding and commitment to these issues, HTC will define and confirm our direction toward sustainable
development, and also let our stakeholders know everything about our performance and the results with respect to
CSR in 2019.
This report has been prepared in Chinese and English. Both versions are posted on our official website and areavailable for download (www.csr.htc.com).

HTC CSR Website
This website is updated annually to inform all stakeholders and the public about
HTC CSR activities. Please use the following link to access the HTC website: www.
csr.htc.com

Time Coverage of Disclosure
We plan to issue the HTC Corporate Social Responsibility Report annually. This report generally covers theyear 2019 from January 1 to December 31. However, in order to provide a more complete picture of all our CSR
achievements in various aspects to date, the content and information about some issues refers to work carriedout in 2018 to 2020 May, as well as the HTC CSR management policies, key issues, and performance, responses
and activities for previous years.

Report BasisThis report has been prepared in accordance with the Global Reporting Initiative (GRI) Standards Core Option
and AA1000 (2008) standards and has been confirmed by SGS-Taiwan to be in compliance with AA1000AS
Type II high-level assurance and GRI Standards Core option.

Process of Reporting Quality Management

Compile• The report information is provided by each department which is responsible for confirming
the completeness and correctness of the data. The confirmed information is thensubmitted to the Quality and Sustainability Management Department for compilation.

The HTC 2019 CSR Report is downloadable in PDF format.
Edit• The Quality and Sustainability Management Department will coordinate with all
departments to discuss the progress of planned goals and future directions.

• Internal：The information required for the report is collected by the person-in-charge ofeach department and confirmed by the corresponding supervisor.

HTC CSR Report 2019

Report Scope and Boundary

HQ & Plants

The organizational boundary, as mentioned in this annual report,
mainly covers the company office buildings and plants in Taiwan: theheadquarters in Taoyuan, two office buildings in Taipei, and the Tainan
Software R&D Center. All HTC business operations in Taiwan arewithin the boundary.

Review• External： SGS Taiwan verified this report in accordance with AA1000 AS AssuranceStandards and GRI Standards. This report is in compliance with the core options of the GRI
Standards and AA1000 Type II High Assurance.

Taipei Office 1
Taipei Office 2

Finalize• After the final version is confirmed by all internal departments, it will be submitted to the
Quality and Sustainability Management Department for review and finalization.

Geographic Coverage of the HTC CSR Report 2019
Boundary

AddressTel

HQ & Plants

No 23, Xinghua Rd., Taoyuan Dist.,
Taoyuan City 330, Taiwan+886-3-3753252

Taipei Office 1

No 88, Sec 3, Zhongxing Rd, Xindian Dist,New Taipei City, Taiwan

Taipei Office 2

1F, No 6-3, Baoqiang Rd, Xindian Dist,New Taipei City, Taiwan+886-2-89124138

Tainan Software
R&D Center

4F., No.701, Sec. 1, Ximen Rd.,
West Central Dist., Tainan City, Taiwan+886-3-3753252

001

Editorial Principle

Tainan Software R&D Center+886-2-89124138

HTC 2019 CSR Report 002

Forward-Looking Statements & Statistical Calculations
In this report, HTC makes some forward-looking statements about future CSR challenges and developments.
However, because some of these issues are uncertain and subject to variable factors (such as policies, laws,
and international regulations), it should be noted that they have been made after discussions on current
HTC status and are made as forecasts, the purpose being to give our stakeholders a picture of the HTC
understanding and realization of CSR issues. The forecasts are not promises by HTC of guaranteed financial,
operational, and business performance.
The figures shown in this report are in the metric system and are statistical and calculated results generated
according to the related international standards and bases of calculation. In the event that any special
calculation methods are implemented for particular indicators, notes are provided below the corresponding
tables or graphics. The information and data of this report were provided by the responsible departments, andwere summarized, analyzed and compiled by the CSR department. They were checked and approved by thehead of each department to ensure that the information provided meet the requirements of the CSR report.

• Financial data was checked and confirmed by Deloitte & Touche, and was calculated in NT$.
• ISO14064 greenhouse gas emissions were verified by BellCERT International Inspection andCertification Group.
• The ISO 9001: 2015, IECQ 08000: 2017, BS 10012: 2017, ISO 14001: 2015, OHSAS 18001: 2007 and ISO
50001: 2011 management systems obtained by HTC were verified by SGS Taiwan.
• The AA1000AS Standard was verified by SGS Taiwan.

Feedback
Should you have any questions about this HTC Corporate Social Responsibility Report 2019, please let us know
to help us make continuous progress.

Contact us
Quality and Sustainability Management, HTC Corporation
Contact: Simon.YK Chen +886 (0)3 375 3252 Ext 31546
E-mail: corporate_responsibility@htc.com
Address: No 23, Xinghua Rd, Taoyuan Dist., Taoyuan City, Taiwan
CSR URL: www.csr.htc.com

HTC 2019 CSR Report 004

Content
Editorial Principle001

Statement of the Management

007

GRI 103:
The management approach and its components in 2019
GRI 103: 2019 Management Approach
GRI Standards Content Index
Assurance Statement

182

184

185

189

041

009

Responsibility
Management

About HTC
Global Operation Locations

Corporate Governance012

Product and Industry Overview

Risk Management

013

Overview of Financial Performance
The Pursuit of Brilliance

111

043

023

Staff Management

047

Supplier Management

113

Talent Attraction & Retention

Innovative R&D Management

022

Friendly Workplace

054

Complete Education and Training Plan

060

Customer Management

119

A Sound Wage and Welfare System

068

025

Corporate Social Responsibility
Management

The Mechanism for Committee Operation

028

CSR Related Management Procedures and Systems
HTC 2019 Material Issues and Boundary031

The United Nation’s Sustainable Development Goals

071
Sustainable Agenda

Sustainable Design

105

109

167

Other Social Engagement Activities

092

Sustainable Packaging
Sustainable Product141

Social Investment
and Contributions

HTC Foundation

074

Sustainable Manufacturing Process
035

138

165

Sustainable Environment
029

129

Listening to the Voice of the Employee
Occupational Health and Safety

120

101

170

Statement of the Management

Thank you for taking the time to peruse the 2019 “Corporate Social Responsibility Report” issued by HTC.
We continue to follow the latest “Global Reporting Initiative Standards” and AA 1000 standards Type II
High Level of Assurance to report information disclosure to the general public and all stakeholders. The
relationship communicates with HTC’s commitment and achievements in reflecting social responsibility andmoving towards sustainable development.
In 2019, HTC’s strategy to continuously focus on innovation has achieved fruitful results, and a number ofpromising products in hardware, software, platforms and services were launched, further strengthening HTC’s
position in the global technology market. HTC will continue to promote the vision of VIVE Reality, invest in
key items of emerging technologies such as virtual and augmented reality, artificial intelligence, 5G high-speed
network, and blockchain, hoping to create a new world based on human experience through cutting-edge
technologies.
In terms of product achievement, HTC won 36 awards at the “Consumer Electronics Show (CES)” heldin Las Vegas, USA in January 2019, covering a wide variety of hardware, software and platform related
products, and was the best record we have ever achieved. Compared to the awards we won at CES 2018, theachievement was 20% more fruitful. In the “Mobile World Congress (MWC)” held month later, the first
product of our new 5G product, HTC 5G Hub, also won ten awards, and its powerful network capabilities
as well as its versatility have impressed telecommunication operators and consumers attending theevent. With such strong technical foundation and rich market experience, HTC will continue to promote
innovation in 2020 and the future ahead.
To realize the vision of VIVE Reality, HTC continues to focus on the development and implementation of coretechnologies such as virtual reality, 5G, blockchain and artificial intelligence. In recent years, besides taking
the initiative to enter the VR market and establish a VR ecosystem, HTC will also continue to enhance ourposition in the smartphone industry. In the future, our primary task is to ensure that HTC plays a key role inthe 5G ecosystem during the development of 5G fundamental products.
HTC continues to increase the operation performance of factories, R & D departments and laboratories,
improve production processes and quality, and seek to reduce greenhouse gas emissions and enhance energy
efficiency. HTC actively promotes practical measures to reduce waste, such as carrying out sorting, recycling
and management at the front end, allowing employees to reduce the generation of waste. In addition,
designated areas were set up for general waste, recycling and food waste, helping to carry out resource
recycling and reuse, reduce the production of waste, and improve the cleanliness of the environment.
In addition to the continuous launching of innovative products, HTC has long been committed to bringing
positive influence to our environment, community and employees, and strictly requires all operating units to
reduce the impact on the environment and actively give back to the society. HTC continues to work towards
the improvement of energy management. For instance, the plants in the factory area are all irrigated withrecycled water, which reduces the overall water consumption by increasing the utilization of wastewater.

007

Statement of the Management

In September 2019, HTC received the Gold Award for
Corporate Social Responsibility from EcoVadis, theinternational sustainability rating platform. Among the
55,000 companies participating in the EcoVadis Corporate
Social Responsibility (CSR) evaluation in 2019, HTC ranked
in the top 5%, highlighting HTC’s continued commitment
to various fields of sustainable development and reflecting
our efforts to become a leader in the industry.
In addition to implementing greenhouse gas inventory andverification every year, HTC voluntarily discloses our climate
risks and future development opportunities, emissions
information, and management mechanism strategies
every year based on the requirements of the International
Carbon Disclosure Project (CDP). In 2019, HTC received
the Management Level B affirmation from the CDP Climate
Change Questionnaire rating, and the Leadership Level A- in
the CDP Supplier Participation rating.
Looking ahead, HTC will continue to uphold the brandspirit of “Pursuit of Brilliance”, the right strategies, worldclass talent, innovation and a heritage of innovation thatwill drive our next stage of growth.
Throughout all of our operations and partnerships, HTC
seeks to ensure the highest standards of environmental
protection and R&D innovation, with a view to creating
a better life for people. HTC strives to become a world’s
leading brand, and you are welcome to give us support,
encouragement and suggestions on HTC’s road to asustainable future.

HTC
Chairwoman

HTC 2019 CSR Report 008

About HTC ___Name
HTC Corporation (TWSE stock symbol 2498)
Address
No 23, Xinghua Rd, Taoyuan City, Taoyuan
County, Taiwan
EstablishedMay 15, 1997
SectorTelecommunications network Industry
Main business
Smartphone/HTC phones and accessories/
Virtual reality device
Consolidated revenue
NT$ 8,188,086,350

The global leader in innovative mobile phone design – HTC

Global Operation Locations

Denmark: Heisler
United Kingdom: Slough*France: Paris

Belgium: Brussels
Germany: Frankfurt

Spain: Madrid

China: Beijing*

Asia-Pacific

Europe, Middle East, Africa

Japan: Tokyo

China: Shanghai*
Dubai

Hong Kong
India: Gurgaon

Taiwan:Taipei*, Taoyuan*,Tainan, Kaohsiung

Vietnam: Saigon
Canada: Vancouver
United States: Seattle*
United States: San Francisco

America
United States: Houston

The HTC Corporation (HTC) was established in 1997. HTC brings brilliance to life through leading innovationin smart mobile device and experience design. Beginning with a vision to put a personal computer in the palmof our customers’ hands, we have led the way in the evolution from palm PC to smartphone, and are now
applying that same innovative approach to connected devices and virtual reality. To date, our Company has
been through four major transformations that have helped us reinvent ourselves and achieve new growth.
Starting from the beginning of the company’s professional PDA design, HTC has continued to deepen
innovation in R&D technology. HTC’s first major turning point came in 1999, when the Company moved into
the telecommunications arena. HTC was the first to integrate Internet, entertainment, video and personal
assistant functions into a mobile phone with a large dimension onto high resolution and full-color display
panel. Since 2007, the launch of the HTC brand globally has committed the Company to long-term global
brand development. In 2014, HTC began to seek new fields to apply our distinguished heritage in design,
engineering and manufacturing excellence as well as innovative thinking. In 2015, we began to enter the virtual
reality industry, and explore and create a new real experience with HTC VIVE.
In 2018, HTC set a new vision: VIVE Reality, cutting-edge technology such as virtual reality (VR), augmented
reality (AR), artificial intelligence (AI), 5G high-speed connection and blockchain. Integrate humanity andhumanities to achieve a richer enjoyment of a better life.
Looking forward to 2020, we expect to launch more breakthrough software and hardware products in VR and
AR. Since VIVE Reality is the integration of VR with AR, 5G, artificial intelligence and blockchain technology,
the commercial 5G products to be launched in 2020 are expected to bring major breakthroughs to the VR and
AR industries.

011

About HTC

MexicoAustralia: Sydney

HTC is headquartered in Taiwan. Driven by effective branding, HTC
now has operations, sales, and services covering most areas in the world,
including Europe, the Americas and Asia. With the coordination andintegration of our operational HQ, HTC provides customers with a
network of professional services.
HTC stands in the immediate presence of our customers and provides
instant service. Offices have been established in all the major markets of
the world, including the USA, Canada, the UK, Germany, France, India,
Australia, China, Japan, Hong Kong, Vietnam, and UAE.
Note: The * is main operating base of HTC, of which “Important Operations Base” is Taiwan.

HTC 2019 CSR Report012

Product and Industry Overview
Since its establishment, HTC has had very strong R&D capability that has been clearly
demonstrated by producing a stream of first-class products for the international
market. HTC has persisted in a consumer-oriented approach to continuously provide
real cutting-edge smartphones and demonstrate our commitment to both users andshareholders through our growing global marketing and service network.
We believe that only a deep, sincere, innovative, and unique experience can truly standout in competition. In this regard, HTC mobile phone design extends the texture andcraftsmanship of products and integrates the design, hardware, user interface, software,
applications programs, and cloud service flawlessly.

013

About HTCHTC 2019 CSR Report014

HTC main Product: Smart Mobile

Product Sales: Smart Mobile and Others (Accessories)

Year

Capacity (thousands)

Output (thousands)

Output Value (NT$ Millions)

2017

9,600

5,015

42,760

2018

7,200

1,673

16,137

2019

6,900

563

5,527

Note: The term “Capacity” refers to the maximum number of a given product the company can produce with the normal operation of the existing manufacturing facilities after
consideration of necessary shutdown and off days.

Year

Domestic Sales

Export Sales

Quantity (Thousands)

Value (Millions)

Quantity (Thousands)

Value (Millions)

2017

1,221

6,869

23,34352,725

2018

791

3,432

14,917

19,552

2019

397

1,847

19,385

7,347

Note: The figures for the main products do not include income from maintenance and product development.

HTC VIVE™
VR (Virtual Reality) is an exciting feature of next-generation computing and entertainment. HTC VIVE
allows users to browse through the VR world and use unique hand-simulation controllers to interact
with objects.

● VIVEPORT● VIVE Cosmos

VIVE Cosmos is designedwith the aim of simple,
convenience, versatility andhigh performance as well as
quality to meet the needs ofvirtual reality users. The allnew VIVE tracking system
offers a simplified setup thatmakes getting into VR fasterand easier than ever before,
with six camera sensors forwide and accurate insideout tracking. Cosmos features a 2880 x 1700 combined pixel resolution—an 88% increase over the original
Vive—delivering crystal-clear text and graphics. All-new LCD panels reduce the distance between pixels
and combined with real RGB displays minimize screen-door effect.
A unique flip-up design allows users to jump between reality and virtual reality in seconds—all without
disrupting VR journeys. Superior ergonomics and comfort allow for longer VR experiences and integrated
on-ear headphones provide fully immersive sound. Cosmos also features completely redesigned controllers
that maximize functionality within VR and offer extended comfort during long play sessions. Cosmos is
also compatible with the Vive Wireless Adapter for those who want to enjoy moving in VR without being
tethered. Of course, a controller is also essential. Our unique controller design can maximize the versatilityof virtual reality and provide a more comfortable experience during a long-playing game. Of course, acontroller is also essential. Our unique controller design can maximize the versatility of virtual reality andprovide a more comfortable experience during a long-playing game.

015

About HTCVIVEPORT is a global virtual reality content store and subscription service platform. With operations in
63 countries, it provides 2,000 types of VR content and more in the future to users around the world, while
offering content developers with the best channel for content distribution and profit making. VIVEPORT
has more than 2,000 different types of applications and games, and supports various VR head-mounted
displays, including computer-connected head-mounted displays, standalone displays, and mobile phonedevices. In response to users' demand for more diversified content, VIVEPORT INFINITY was launched in
April 2019, which is the world’s first VR content subscription service that supports different hardware.
Through VIVEPORT INFINITY, users can enjoy diversified VR content such as education, travel, movies,
and games more efficiently. Without limiting the service to single head-mounted display not only increases
the number of users, but also attracts more content developers to join in, bringing more benefits to
independent content developers.

HTC 2019 CSR Report016

● VIVE ORIGINALSHTC VIVE ORIGINALS is a content brand and content platform under HTC VIVE, which is committed
to the development of native IP and the production as well as the distribution of original content. It also
explores the development of VR movies, art, animation, music, cultural collections, and cultural & creative
entertainment industries, actively cultivates the cross-domain content creation teams, and establishes VR
technical specifications and content production standard operating procedures, providing more diversified
VR solutions. Besides making profits through new business models such as cross-domain content broadcast
authorization, exhibition and art collection trading, we also actively seek for collaboration opportunities
with the government in film and television investment to expand the scope of content and create industrial
value, enriching people’s culture and life from content clusters in the VIVE Reality ecosystem through newtechnology and creativity.
The VIVE ORIGINALS team was established in 2017, and its production “The Deserted” was nominatedfor the VR Competition of the 74th Venice Film Festival. In 2018, the team cooperated with the Golden
Horse Awards Executive Committee to produce the VR film “5x1”, among which the “5x1-The Making Of”
and the “5x1” -“Mr. Buddha” was nominated for the 2019 South by Southwest Film Festival and the 2019
Tribeca Film Festival, respectively. Furthermore, the original works of VIVE ORIGINALS VR also shinedat the 76th Venice Film Festival, setting a record with five films being nominated at the same time for the
VR Competition of the 76th Venice Film Festival, including the “5x1-O” and the “5x1-Only the Mountain
Remains”, the VR interactive art “INORI” and VR animation, the “Gloomy Eyes”, in addition to the above
four works, the “5x1- The Making Of” also won the Best of VR – Out of Competition.
In addition to the production and distribution of original VR content, HTC VIVE ORIGINALS also
develops a VR theater management system (TMS) that meets the demand of film exhibitions. To connect
contents with commercial channels, the “Blockchain Copyright Trading Commercial System” will belaunched next year, serving as a pioneer in theater management system. This integrated platform will help
content developers, cultural & creative entrepreneurs, and offline channel operators to integrate resources,
allowing contents and commercial channels to collaborate more effectively, and maximizing the expansionof business cooperation models.
● VIVE Arts

VIVE Arts is a global initiative aimed at enhancing artistic creation and appreciation through the latest
technologies. VIVE Arts exemplifies the unity of technology, humanity, and imagination that forms thefoundation and core values of the VIVE brand. Since 2016, HTC has been actively exploring the potentials
of virtual reality in the creation, appreciation, education, and promotion of the arts. The establishmentof VIVE Arts in 2017 not only provided artists with a brand new creative medium, and platform, but also
opened a portal for humans to appreciate the humanities and arts without time-space limitations.
In 2019, VIVE Arts demonstrated a remarkable global impact through strategic partnerships andhigh-profile projects with the world’s most renowned museums, cultural institutions and artists. A
groundbreaking partnership with Musée du Louvre in Paris- the most visited museum in the world with
10.2 million visitors per year-culminated in the Museum’s first VR experience, Mona Lisa: Beyond the
Glass. The exclusive VR exhibition hall with 11 VIVE Cosmos headsets is located in the center of theretrospective exhibition of the Musée du Louvre commemorating the 500th anniversary of the death of Da

017

About HTC

Vinci in France. As the ultimate opinion leader in the museum world, the Louvre’s enthusiastic embrace of
VR technology for the exhibition and communication of art has generated extraordinary responses acrossglobal media, including The New York Times, BBC, Wall Street Journal, Financial Times, Guardian, The
Times, and Art Newspaper. These positive reviews further established VIVE Arts' position as the mostvisible industry leader in art and technology.
VIVE Arts supported the first official VR art commission by the Venice Biennale, the world’s oldest andmost authoritative contemporary art exhibition, which serves as the indicator of the future trend in art.
This commission and exhibition symbolized the mainstream art world’s official acknowledgment of virtual
reality as an important artistic medium—for the first time, VR is official written into the mainstream art
history book. In March 2019, VIVE Arts established a major partnership with the American Museum of
Natural History to present their first multi-player, interactive VR experience T. Rex: Skeleton Crew, as partof the Museum’s 150th anniversary blockbuster exhibition T. Rex: The Ultimate Predator, on view in New
York for 17 months. Also in March, for a second year as the official VR partner of the Art Basel International
Art Fair’s Hong Kong exhibition, VIVE Arts presented the Asian debut of To the Moon, the latest VR
artwork created by the esteemed American avant-garde artist Laurie Anderson and Taiwan’s leading new
media artist Hsin-Chien Huang. These important cooperation and exhibitions have been reported in great
length by major international media.
Other notable partnerships in 2019 include Museo Universitario de Arte Contemporaneo in Mexico City,
Singapore’s ArtScience Museum, The Old National Gallery in Berlin, Museum of Applied Art in Frankfurt,
London Fashion Week, Kaohsiung Museum of Fine Arts, and a major presentation of VR art at the National
Palace Museum in Taipei participated by leading international museums. VIVE Arts will continue toexpand and deepen its partnerships with the world’s top arts and cultural institutions, to bring more
beautiful, meaningful and groundbreaking VR experiences to people.
● VIVELAND

VIVELAND is the brand name of HTC VR LBE (location based entertainment) solution provider.
Launched in October 2016 on the 3rd floor of Syntrend Creative Park, VIVELAND provides users withvarious mix reality (MR) and themed experience, such as multiplayer shooting games, VR eSports games,
omnidirectional VR haunted house, room escape games, racing games, sports sections and 4D motion
seats, etc. The new VIVELAND branch ‘8D-ZONE’ located on the 8th floor of Syntrend Creative Park waslaunched in 2019, specifically designed for competitive multiplayer games. VIVELAND has accumulated
quite a lot of operating experience since its establishment. At the end of 2018, it co-founded VIVELAND
Kaohsiung with Kaohsiung City Government. Located in Taroko Park Kaohsiung, VIVELAND Kaohsiungoccupies 826.45 m² and is currently the largest VR theme park in Taiwan. After its renovation in July 2019,
VIVELAND Kaohsiung can accommodate 20-30% more visitors and provide the best VR experience tomore users. VIVELAND is also actively expanding globally. The first overseas VIVELAND franchise waslaunched in Hong Kong in early 2019, partnering with Easco Telecommunications Limited. VIVELAND
will continue to cooperate with global content providers to develop the most suitable VR content for arcade
experience. Each game available in VIVELAND has been carefully tested and optimized to ensure that thecontent is engaging enough to generate profits constantly.

HTC 2019 CSR Report018

Industry Overview
Smart phone industry overview
The smartphone industry will welcome new technologies in 2020 due to the transfer of new communication
technologies. Faster communication speeds in the 5G era will mean various services will leveragecommunication technologies to offer new applications. Changes in the specifications of the communication
chip will drive the possibility of replacement, and more opportunities for new services will drive changes in
hardware specifications of smartphones and the emergence of new requirements. Looking at the developmentof 5G in the future, HTC will continue to leverage its leadership heritage in the market and bring innovative
products to the industry.

1G

2G

3G

4G

5G

Year

1980

1991

2001

2008

2020

Technology

AMPS

GSM
CDMA

WCDMA
CAMA2000
TD-SCDMALTE(To be finalized
in2020)Call, Message,
Internet, 1080P
Video streaming
serviceCall, Message,
Internet, 4K Video
streaming service,
VR streaming, Auto
Guided Vehicle,
Teleoperation

ServiceCallCall, Message,
Text MailCall, Message,
Internet,
Streaming
service

Speed

2 Kbps

10 Kbps

3.8 Gbps

0.1-1 Gbps

1-10 Gbps

800-900 MHz

850-1900 MHz

1.6-2.5 GHz

2-8 GHz3-300 GHz

Frequency

HTC’s upstream suppliers provide components parts and operating systems. Downstream channels include
telecom service providers, distributors and retailers. HTC has continued to work closely with upstream
partners to ensure the high quality of our products, and retains good relationships with traditional telecom
partners and distributors around the world. HTC has also put emphasis on online as well as offline retail
distribution, reflecting the global trend towards omnichannel sales of consumer goods.

Upstream suppliers

Manufacturers

Downstream channels

Components suppliers

Mobile phone design

Brand

Operating systems
suppliers

Mobile phone
manufacture· Telecom service
providers

Mobile phone assembly· Distributors· Retailers

019

About HTCHTC 2019 CSR Report 020

Virtual Reality industry overview

Re-investment & Affiliated Companies

Virtual reality comes from the human pursuit of immersion. It is also the direction of technology
development accumulated by the smartphone industry in the past 10 years from various key technologies
such as displays, processors, and controllers. While fulfilling the craving in visual effect, consumers also
hope to “be on the scene personally” to experience different virtual worlds. The virtual reality industrial
chain is dominated by hardware equipment manufacturers. Brand manufacturers are mainly responsible
for R & D and specification formulation, while key component developers then assemble special motion
capturing and displaying components, into a virtual reality helmet (headset) that can be connected to acomputer operated independently.

Hardware
Semiconductor
· CPU
· GPU
· VPUs (Vision
		 Processing
		 Units)

Components· Moving captureunits· Battery· Display screen· Lens, 3D Lens
· Audio chip

VR/AR Headset· Connect to PC· Standalone· Connect to		 the mobile 		phone

PlatformContent

APIs & SDKs
· VR
		 development
		engine· AI technology· Application
		platform

Development
program· Health related
		programs· Social		platforms· 3D/VR
		Visualization
		software

At present, the major hardware manufacturers in the VR industry include Oculus created by Facebook,
VIVE created by HTC and PS headset created by Sony. Each manufacturer adopts different development
directions due to different industrial strategies. The VR industry trends are divided into three major
directions: the first one is to improve the hardware specifications of VR headset, the second one is tocooperate with software vendors to develop application services to meet consumer needs, and the third one
is to expand more optimized business applications in individual fields.
Since VR products were introduced into the consumer market in 2016, regarded as the “First Year of VR”,
hardware manufacturers began by using games to attract people’s attention. Playing games with VR not only
enhances the visual enjoyment, but also gives players the opportunity to immerse themselves in games.
Moreover, the sensory experience of players can be enhanced with new controllers. In the past, VR headset
mainly connected to a computer with powerful graphic computing capability in order to have a better visualexperience. The recent direction of development for manufacturers is the standalone VR, which allows
users to have more freedom in terms of movement. This eliminates the interference of connecting lines andoffers better user experience.
The development of VR hardware requires continuous cooperation with software developers. The wellknown game platform “Steam” is a good example. HTC collaborates with developers to independently
develop the VIVEPORT platform, enabling developers to launch their application services online. This
allows VR not only to have applications in games, but also in movies, social media, drawings, etc. As for VR,
we believe that abundant content and application support is the key to attract consumers and stimulate
VR market growth. That’s why we are building a VR ecosystem that can integrate software and hardware to
expand our penetration into consumer market.
The third major development direction of VR is to develop functions in professional fields. From thecurrently known applications, medical and architectural industries welcome VR applications. Especially the
3D imaging environment provided by VR can make training and simulation in medical related industries
more efficient. For instance, the use of VR for surgery simulation as well as training of medical instrument
operation can make virtual scene into full play. In the 5G era, due to the faster networking speed, VR in
medical application can make the transmission of real-time images possible, enabling the performance ofmulti-party diagnosis or even remote operations.

HTC’s reinvestment policy focuses on the core business of the organization and the businesses that are
beneficial to long-term future development. In addition, through appropriate financial assessments andanalyses of industry trends, market competition, team experience, businesses models, and risk assessment,
strategic investments have been carried out through equity investment or mergers and acquisitions. The
specific objectives are to continue to enhance product and service quality, strengthen the developmentof key technologies, and grasp the future market demand, thereby continuing to enhance the corecompetitiveness of HTC.
We continue to expand and deepen the virtual reality and augmented reality ecosystem. Through strategic
investment and the implementation of the VIVE X accelerator program, we work with potential virtual
reality and augmented reality startup teams around the world to jointly solve bottlenecks for the industry,
improve user experience of virtual reality and augmented reality, and promote the development of the entire
industry. VIVE X operates in six major cities around the world, including Taipei, Beijing, Shenzhen, San
Francisco, Tel Aviv and London. VIVE X cooperates with various departments of VIVE to successfully assist
the startup teams in operation, technology, product, capital, etc. In addition to VIVE X’s leading position in
the industry, VIVE X’s Demo days are also a major event for the VR/AR investment community. Throughintensive and professional trainings, VIVE X successfully led the innovation teams to showcase brand-new
VR applications for investors and companies around the world, and to demonstrate the creative power of theteams and the unlimited potential of VR. Besides the regular Beijing/Shenzhen and San Francisco events held
previously, VIVE X Demo days were held in Tokyo and London for the first time in 2019, with more than 150
investors and companies visiting each event.

Overview of Financial Performance
In 2019, the competition in global mobile phone market continued to be intense, resulting in reduced
revenue and gross profit as compared to those in 2018.
HTC’s consolidated revenue for the whole year of 2019 was NT$ 10 billion, the consolidated gross profit
was NT$ 2 billion, the consolidated gross profit margin was 20%, the operating income margin was -98%,
the net profit after tax was NT$ -9.4 billion, and the earnings per share (LPS) was NT$ -11.43. Affected by
the competition in the global smart handheld device market, shipments decreased compared with the same
period of last year, resulting in a decrease in revenue in 2019 as compared to that in 2018. In addition, due
to proper cost control in this year and changes in product combination, the gross profit in 2019 increased ascompared to that in 2018. The operating cost has been reduced as compared to that in the previous period
due to the continuous implementation of the austerity policy.
The changes in non-operating income and expenses in 2019 and 2018 are mainly due to the cooperativetransaction agreement with Google in 2018, the transfer of some personnel and assets, and the gain on
disposal of patent authorization.
Unit

2017

2018

2019

Operating Revenue

NT$ Million

62,12023,74010,015

Operating Costs & Expenses

NT$ Million

79,54537,704

19,865

Income Tax

NT$ Million

-38

5,204

-6

Employee Wages

NT$ Million

11,825

8,730

6,476

Dividends

NT$

0

0.38

0

Social Investment /Donation

NT$ Million

0

0

0

Note: 1. The related figures are those listed in the consolidated statement. 2. Final decision after annual shareholders’ meeting.

021

About HTCHTC 2019 CSR Report 022

The Pursuit of Brilliance
HTC is an innovation company, creating powerful new products, solutions, and platforms in mobile computing
and immersive technologies. Beginning with a vision to put a personal computer in the palm of our customers’
hands, we have led the way in the evolution from palm PC to smartphone, and are now applying that sameinnovative approach to connected devices and virtual reality.
At the heart of this is a bold entrepreneurial spirit of pushing new boundaries, while leveraging the capabilities
we have developed in our history in the pursuit of brilliance.
The notion of Dare to Dream is at the heart of our daily ambitions. We ask fundamental questions at theintersection of customer aspirations and our capability to delight and surprise with innovative solutions. We
challenge ourselves and our customers to achieve their full human potential. What’s your dream? Can you
visualize it? Will it shift our perspective? Will we feel it? The future belongs to the dreamers to power creationand innovation. Because our dreams power the future. Dare to Dream.

Future Goal
To increase market share
To strengthen the integrationof marketing
To deepen the penetration of
our brand

As we live this philosophy of Dare to Dream, we employ powerful technologies and combine them in creative
new ways in order to deliver this. At this time in history, mobile, VR, AR, 5G, AI, and blockchain are evolving
and coming together with the potential to deliver utility and experiences previously unavailable. We call thisVIVE Reality.
Our future is enhanced in a world where HTC innovation and VIVE experiences blend to create a new reality.
There are three important pillars to ensuring our approach is true to our intentions:

For HTC, our innovation is human-centered in the broadest sense.

Current Achievement

Humanity

We endeavor to expand our vision to impact people’s lives in ways
never before considered.

Creating a global smartphone with excellent designs
The most valuable international brand from Taiwan
The world’s first virtual reality system VIVE brings real-world interaction and experiencethrough space-based positioning technology

Technology

Through virtual reality and augmented reality, big data, and artificial intelligence
technology, with the goal of developing and providing precision personalized medical
products and services to reduce costs and improve the effectiveness of healthcare
Imagination

HTC’s
Challenge
How to enhancebrand loyalty

023

About HTC

Our history and commitment to technology excellence is the great
enabler of our pursuits.
We strive for a world in which customers, large and small, haveaccess to the most powerful hardware, platforms, tools, and services.

Imagination is one of the most powerful tools we know, and one weseek to unlock.
A world where a continuum of immersive realities is possible, andexperience is unbounded.

This Dare to Dream philosophy and approach are reflected in a steady stream of world-class innovation, as
we continue to advance new products in VR, mobile, and 5G with greater capability and convenience. We
also continue to advance our societal, environmental and cultural initiatives, and our support of education.
From our people to our products, Dare to Dream represents a guiding philosophy that energizes HTC as a
global organization.

HTC 2019 CSR Report 024

Corporate Social
Responsibility
Management ___To ensure effective discussion and treatmentof CSR issues, HTC has run a CSR Committee
since 2012, and has also set up a dedicatedteam for formulating CSR policies, drawing
up related action plans, performing crossdepartment coordination, and handlingcommunication with, and feedback from, theexternal stakeholders and our key suppliers.
We use clear organization and work breakdown,
through interdepartmental meetings, tointegrate CSR work into the managementof related departments, such as legal affairs,
compliance, environment, procurement,
human resources, and marketing, to activate
overall CSR and innovation. This ensures that
CSR policies and measures are an integral partof the daily operations of the company.

The Mechanism for Committee Operation
HTC won the 2019 EcoVadis Corporate Social
Responsibility Gold Medal
HTC was awarded the Corporate Social Responsibility Gold Medal by
EcoVadis, an international sustainability rating platform, in September 2019.
HTC has ranked in the top 5% of the 55,000 companies participating in the 2019 EcoVadis
Corporate Social Responsibility (CSR) assessment, this result earned HTC a gold medal in the thirdyear from 2016.
HTC was among the top 11% of all suppliers assessed and ranked in the top 7% of sustainableprocurement indicator by EcoVadis in the category of Manufacture of communication equipment;
Receiving this gold status once again underlines our continuous commitment to all areas ofsustainability and reflects our efforts to be a frontrunner in our industry.
The EcoVadis Supplier Sustainability Rating system assesses a wide range of CSR indicators in thecore areas environment, labor & human right, ethics, and sustainable procurement. Since 2007,
EcoVadis has been compiling sustainability scorecards for nearly 55,000 companies in around 190
different sectors and by participating in the EcoVadis CSR assessment process, HTC is part of anillustrious group of leading multinationals from 155 different countries committed to efficiently drive
CSR & sustainability performance.

The HTC CSR committee discuss each year based on the CSR goals set by each department and major annual
issues. The HTC CSR Committee convenes a monthly meeting, and each department reports the results of theimplementation of CSR related issues, and authorizes the department heads to follow up Track and control the
direction and results. Since 2013, CSR affairs and actions have been extended to the supply chain.
In addition to supplier CSR compliance audits, relevant education and training mechanisms will also be
implemented. In addition, the CSR performance results of the year will be regularly invited by the CSR
department to gather relevant departments for compilation, and a CSR report will be prepared and issued
according to the GRI guidelines.
Structure of the HTC CSR Committee
HTC CSR Committee

Employee Care

MFG

Product

Sourcing

Environment

The HTC “Corporate Social Responsibility (CSR) Policy”
HTC is committed to observing all the International and Regional laws in the countries where it
operates and to do business with honesty and integrity. We will continue to provide innovativeand quality products, protect the environment, care for the health, safety and human rights of ouremployees, and positively maintain our stakeholders’ rights and interests.
This CSR policy helps HTC maintain social responsibility and realize the vision of sustainable
development. All our related business partners advocate and share this policy with us and in thisway, we all protect and enhance the rights and interests of our internal and external stakeholders.

Using Responsible Business Alliance Code of Conduct as a reference for code of conduct,developing HTC as a good corporate citizen and participating in international Initiatives
Promotion of energy efficiency, carbon-reduction practices and various environmental
protection activities
Sustainable innovation from creation to development
Sustainable supply chain managementt
Be a responsible corporate citizen, with the highest ethical standards

027

Corporate Social Responsibility Management

HTC 2019 CSR Report 028

CSR Related Management Procedures
and Systems
This HTC CSR report is based on the GRI Standard with a focus on disclosing GRI material issues, mainly
concerning disclosure of material issues related to action, performance and achievement.
Based on the relevance of the industry, the stakeholders have been identified, and the issues of concern havebeen included in the major issues. In 2019, online survey questionnaires were sent out extensively and a totalof more than 40 responses were received. In 2019, questionnaires were issued to employees of HTC related
departments, and more than 40 responses were collected. The HTC CSR Committee members met to confirm
the impact of the material issues on the internal and external organization. In other words, the positive,
negative, or potential impact on the economy, environment and society, taken as a whole in accordance withinternal considerations, industrial conditions, industrial chain practice, and stakeholders’ suggestions, as wellas to confirm the impact of each issue. At the same time, HTC attaches great importance to communicationand interaction with its stakeholders. In addition to setting up various communication channels, we respondto important suggestions or opinions from stakeholders based on their concerns and impact on HTC’soperational impact. The feedback is submitted to the relevant departments for response and processing, thanregularly disclosed in the CSR report. We will gradually invite and encourage internal and external entities tojoin the CSR disclosure process in the future.
In addition, to ensure that the policies and decisions of the “CSR Committee” can be put into practice, wehave divided CSR activities into four areas, “green products, environmental protection, occupational safety &health, and social responsibility,” and have set up a dedicated management system for each. These have beenverified as aligned with the applicable international regulations and standards, and help integrate company
policy for sustainability and social responsibility into our daily operations. CSR annual performance and next
year’s operational targets will be reported to the supervisor/Audit Committee of the board of directors at least
once a year.

CSR related management system

Green ProductsManagement System

Green ProductVerification

Environment
Management System

Occupational
Safety & HealthManagement System

EnergyManagement System

Personal Information
Management System

029

Corporate Social Responsibility Management

Since the end of 2007, HTC’s HQ & Plants and the Taipei offices have regularly passed all audits
conducted by the international certification agencies, and obtained and maintained certificatesof IECQ QC080000 Hazardous Substance Process Management. In May 2017, IECQ officiallyreleased the fourth edition of the international standard (IECQ QC080000:2017 edition 4.0). In
Oct 2019, we have obtained the certificate of the latest IECQ QC080000:2017 certificates.

To comply with the Restriction of Hazardous Substances (RoHS) of EU, HTC products aresent to third-party international verification institutions for chemical analysis, ensuring thatthe products are free of concerning heavy metals, bromine-containing flame retardants andplasticizers. The verification on products’ energy consumption in compliance with the US
Department of Energy’s battery charging and energy consumption requirements is performed.
Verification on power supply’s energy efficiency is conducted to ensure that the energy
conversion efficiency of products is higher than the standards in various countries.

We strive to minimize the impact of our operation on the environment. In addition toestablishing the ISO 14001 environment management system, and make sure all our
manufacturing sites around the world obtain and maintain ISO 14001 certificates. From 2011 to
2019, there were no penalties for breach of regulations or laws.

To reduce the risks of workplace injury and reduce accidents, the Occupational Safety & Healthmanagement system has been established according to OHSAS 18001, and make sure all our
manufacturing sites around the world obtain and maintain OHSAS 18001 certificates.
It is expected to carry out the conversion in 2020 and obtain the certificate.

ISO50001 inventory the source and amount of greenhouse gas emission according toISO14064-1 Standards. The energy management system enables planned energy management
to be realized, thereby supporting sustainable operation.

HTC introduced BS 10012 PIMS (Personal Information Management System), which includes
40 management policies and guidelines, such as the HTC personal information protection
management policy, and implemented the System in employee education and training, productdevelopment and design, vendor management, and information security incident management.

HTC 2019 CSR Report 030

HTC 2019 Material Issues and Boundary
2019 HTC Material Issues Matrix

Material Issues and Boundary Identification

High
Material issueMarket Presence
Employment
Labor/Management Relations

Corresponding
page number

Within theorganization
HQ

Economic Performance

Outside the organization

R&D
Corporate
Investor
CenterCustomers

Consumers

Employee

Supplier Contractor

Local
community

Economic Standard

Customer Privacy
Compliance with
Socioeconomic Regulations

Economic
PerformanceMarket Presence

22, 130

V

129

V

V

V

V

V
Environmental Standard

Emission

Stakeholder Interest

Wastewater and Waste
Diversity and Equal
Opportunity

Impact on HTC Business● Economic● Environmental● Social

Corporate Social Responsibility ManagementVV87, 101-104

V

V

Customer Health and Safety

Social Standard

Occupational Health and Safety

Marketing and labeling

Low

031

Wastewater and
Waste

Emission

76

High

Employment

118, 131-138

V

V

V

Labor/
Management
Relations

139

V

V

V

Occupational
Health and Safety

62, 104, 141,
146, 148, 151,
155-164

V

V

V

Diversity andEqual Opportunity

44, 114-116,
119, 129

V

V

V

Customer Healthand Safety

69, 97-100

V

V

V

V

Customer Privacy

47-49, 69

V

V

V

V

Marketing andlabeling

105-107

V

V

V

Compliance with
Socioeconomic
Regulations

28, 45-46,
59, 69, 92100, 113

V

V

V

V

V

V

HTC 2019 CSR Report 032

Diversified Channels for Transparent Information Disclosure

Investors
General Shareholders

Enterprise
Customers

GeneralConsumers

Employees

Suppliers

Contractors

Corporate Shareholders

Corporate Customers

Dispatch manpower

General Employees

Raw material suppliers

Construction Contractors

Rating Agencies

Telecom Distributors

Vocational Students &Trainees(including Direct/ Indirect/
General Service & Facilities/
Staff Clinic/hospital)

Cleaning/ Maintenance
Service Providers
Waste Disposal Vendors

Foreign Labor

Significancefor HTC
Concerned Issues
Communication Channels
and Frequency033

The support of shareholders
and investors has positive
impact on HTC's sustainable
operation

The support of shareholders andinvestors has positive impact on
HTC's sustainable operation

Information disclosure(finance, business)
Compliance with laws
and regulations
Operation Status
Strengthening corporate
governance
Strengthen risk
management
Key shareholder shareholding rates

Product quality
Service quality
Price competitivenessOn-time delivery
Green products
Carbon footprint/ carbon
disclosure
Restricted substancemanagement
Corporate social
responsibility

1. Board of Directors
meeting 4/year
2. Shareholder conference
1/year
3. Annual report 1/year
4. Investor Conference
Quarterly
5. Monthly revenue
statement Monthly
6. Visiting investors
Standing
7. Investor RelationshipWebsite Standing
8. Spokesperson Standing

1. Business review with key
customers (QBR meeting)
Quarterly
2. Reply to customer inquiries
From time to time
3. Customer audit andreplies to customers
questionnaires
As required by customers
4. Meeting the customer
requirements about
environmental and social
responsibilities
As required by customers

Customers satisfying with our after-sales
service is essential to maintain customer
relationsThrough cooperation andproduct development, enhance
the company's value and pursue
growth, gradually improving
corporate sustainable operation

Corporate Social Responsibility Management

Pre-sales consulting
After-service
Product quality
Service quality

1. Local service hotlines in 22 countries
to provide customers with real-timecommunication and assistance
Daily ongoing
2. Websites in different languages forcustomers to give feedback and toaccess information in a real-timemanner (20 established) 		
Daily ongoing
3. Dedicated email boxes for different
functions (PR, Service, Copyright,
Security, etc.) to provide convenient
customer contact with HTC 		
Daily ongoing
4. Postal service survey for investigating
customer satisfaction Daily ongoing
5. Contacting customers who givenegative feedback in the satisfaction
surveys to address their concerns
Daily ongoing

HTC upholds the peopleoriented philosophy, thekey to maintaining thecompany's momentum ininnovation comes from
employees, which are thecompany's most precious
assetsLearning & growth
Working environment /labor conditions
Wage/welfare
Health & safety
Career development
Work-life balance

1. Department quarterly
meeting Quarterly
2. One-on-one interview
with supervisors
Irregularly
3. Annual performanceappraisal/ interview
2/year
4. New employee
seminar Weekly
5. Employee assistance
hotline and mailbox,
Health Center,
Employee Aid
Scheme 		
From time to time
6. Labor-management
meeting Quarterly

Local
Communities
Local Community
Associations
Local Civic Organizations
Local Governmental
Agencies
Local Media

Maintain a safe
working environment
in the company,
strengthen
the company's
cohesivenessand enhance thecompany's image

Maintain good
relations with thelocal government andneighboring communities
to enhance thecompany's image

Raw material quality
Construction safety& health
Price competitivenessContinuously stable supply
Supply chain management
Compliance with various
regulations
Technical capability
Cooperation with logistics/
transportation providers to
conduct effective packing (e.g.
packing reduction and reuse)
Raw material selection
Working environment & health
Machine/equipment safety
Carbon management training
and contests

Environmental impact(air pollution, sewage
discharge, etc.)
Compliance with laws
and regulations
Shaping the Corporate
image
conomic contribution
Social concerns
Public welfare
Cultivation of talentPartner with suppliers is anindispensable key to thecontinuous growth of business
operations

1. Supplier communication
conference Irregularly
2. Guidance and audit for
suppliers Annually
3. Cooperation project with
suppliers for addressing
CSR and greenhouse gas
issues Continuous project
improvement every year.
Projects issued in 2019
include supplier CSR audit/
GHG disclosure/ Keysupplier CDP questionnaire
replied/Banned andrestricted substances
investigation in the
manufacturing process

1. Induction training
Weekly2. Patrol inspection in
the facility Daily

1. Positive employee
engagement in public
interest activities
Irregularly
2. HTC cooperation
with governmental
agencies and nonprofit organizations ineco, environmental andother public welfare
activities Monthly

HTC 2019 CSR Report 034

The United Nation’s
Sustainable Development Goals
In 2015, the United Nations passed 17 Sustainable Development Goals (SDGs) aimed at ensuring peace andprosperity for all people. Each goal also details specific goals to be achieved in the next 15 years, thereby
establishing the guideline and blueprint of the future sustainable development direction, serving as a global
sustainable development agenda and action appeal. In order to achieve a more sustainable future, companies,
governments, and society need to fulfill their responsibility and make an effort.
As global citizens, we spare no effort to implement the goals of the United Nations. We are committed tointegrating SDGs into corporate operations and business development planning In addition to establishinggender equality in practice and empowering female employees and providing them with benefits, we also focus
on green sustainability in the manufacturing process, achieving responsible consumption and production.
Externally, the HTC team has also collaborated with external institutions on the research and development of
products and services that enhance healthcare quality, making full use of innovative technologies to promotesound health and well-being of people of all ages, while establishing multiple partnerships with teams fromdifferent fields to accelerate the implementation of goals.

VR for Impact Project
HTC believes its unique virtual reality technology can bring unprecedented change to the world. Throughthe interactive and immersive experience that HTC VIVE can provide, we hope to change developments in
education, health, medical care, art, and many other fields. In response to the United Nation’s sustainable
development goals of eradicating poverty, protecting the earth, and ensuring peaceful and prosperous life of
mankind, HTC announced the VR for Impact Plan in 2017, providing US$10 million in funding and technology
to encourage the development of more virtual reality content and technology that produce a positive impact.
Since the release of the plan, we have received much feedback from the media and the industry. So far, morethan 800 developers and organizers have expressed great concern, hoping to work with HTC to bring real
influence to the world.
In early 2018, HTC VIVE established a partnership with the World Economic Forum (WEF) to promote thedevelopment of the VR/AR for Impact initiative, help global virtual reality partners develop relevant content
that helps raise awareness of issues, and bring about a force for change in the world. And the WEF 2018
United Nations Sustainable Impact Hub in Davos showcased its latest content. We firmly believe that the
introduction of this virtual reality program will become a powerful way to raise awareness of 17 UN sustainable
development goals tool. Please read the following items for details of the 2019 plan results.
For more information on VR for Impact, please visit our website: https://vrforimpact.com

SDGs Item

Corresponding project

Description

In Jan. 2019, “Tree” launched on VIVEPORT, it allow theaudience to experience the virtual reality of deforestation intropical rain forest, hoping to raise the attention of the public
on global climate change.
HTC made a corporate donation to the Rainforest Alliance,
which works to help prevent deforestation around the world.

Journey to Kenya in 360° virtual reality, where the futuresof wildlife and people are intertwined. “My Africa: ElephantKeeper,” is a groundbreaking liveaction experience that puts
you in the shoes of a keeper at the Reteti Elephant Sanctuarycaring for the newest arrival, a “baby elephant” named Dudu.
In Apr. 2019, My Africa: Elephant Keeper launched on
VIVEPORT and debuted at EarthX film festival, in collaboration
with Conservation International. All VIVEPORT revenue fromthe sale of Elephant Keeper go to benefit the Reteti Elephant
Sanctuary in Kenya.
For more information, please visit the official website
of VIVEPORT: https://vrforimpact.com/blog/my-africaelephant-keeper
In Nov. 2019, Life-saving Instruction for Emergencies (LIFE),
a virtual reality (VR) medical training platform developedby doctors, nurses and researchers at the KEMRI-Wellcome
Trust Research Programme (KWTRP) in Kenya and Oxford
University with support from HTC, has launched. LIFE uses
HTC VIVE Focus Plus for training doctors and nurses to save
lives. HTC Focus mobile headsets were deployed to Kenya
for on-the-ground training, and VR training application was
released on the Engage VR educational distribution platform.
For more information, please visit the following website：
https://vrforimpact.com/blog/life-vr
VR for Impact sponsors the 2019 “United Nations Women
Global Voices Film Festival” to recognize female film and VR
creators from around the world, promote gender equality andempower women.
For more information, please visit the following website：
https://www.globalvoicesfilmfestival.org/

035

Corporate Social Responsibility Management

HTC 2019 CSR Report 036

HTC’s Performance in Response to the UN’s Sustainable Development Goals

Goal 3:

Good Health and Well-being

Through the integration of virtual reality technology and education and with the full range of software andhardware support, VIVE has visualized abstract knowledge, turning learning into an experiential journey
immersed in virtual space and comprehensively changing existing forms of education.

The first AI personalized caring Chat Robot in Taiwan - “Wan Xiao-Fang”

Following the collaboration of HTC DeepQ and Taipei Municipal Wanfang Hospital to launch the first artificial intelligence (AI)medical service Chat Robot Wan Xiao-Fang in 2017, HTC announced in 2018 that it will be upgraded to AI personalized caring Chat
Robot “Wan Xiao-Fang 2.0”, which is the first Chat Robot in Taiwan with complete medical care services. Its features include:

provide the vaccination information of the child, determine the date of taking vaccination, and perform pre-vaccination
health assessment. Services offered by the Disease Control Butler include searching the nearest vaccination hospitals, sending
reminders for vaccination, and answering health related questions, serving as a good helper for parents and doctors.
Important features of the “Disease Control Butler 3.0”
1. Influenza information and vaccination: Before the beginning of the influenza epidemic season, check whether the user isqualified for free vaccination, display medical institutions that offer influenza vaccination, and remind the user to take thevaccination when it is available.
2. Infant vaccination information and vaccination reminder: Based on the child’s date of birth and the date of previous
vaccinations provided by the user, the Disease Control Butler can determine the dates for subsequent vaccinations
and automatically remind the parents to take their child for vaccination. Moreover, parents can also check the stock ofvaccines in each hospital.
3. Epidemic disease information and the status in Taiwan: Users can check Taiwan’s epidemic status for the past week orsubscribe the Weekly Domestic Epidemic Report, which is issued every Wednesday to know the infectious diseases that
we need to pay attention to in life and the status of the disease. If you encounter a disease that you do not understand,you can ask the Disease Control Butler directly, it will identify common questions through medical natural language
processing and provide immediate answers within 24 hours.
4. Foreign epidemic status: Before travelling or going abroad for business trip, users can check the epidemic status andwarning level of the local area. The Disease Control Butler will also remind the user to make necessary preparation one
month before going abroad.
5. Hospitals for medical treatment: If users experience uncomfortable symptoms and suspect that they may be infected with
an epidemic disease, they can check the nearest hospital designated by the National Health Insurance and seek medical
treatment immediately.
6. Know the high-risk groups: Pregnant mothers and infants are high-risk groups of many infectious diseases. If your family
members are in these groups, you can check the key precautions for these groups from the Disease Control Butler.

As of the end of 2019, the total number of users for the Disease Control Butler has reached88,303 people.

• AI hospital division guidance: Guiding users to register appropriate division in the hospital for diagnosis and treatment,
offering caring services.
• Pre-diagnosis notes: Systematically ask questions about patients’ previous visits to the hospital, improving the efficiency ofpatient-doctor communication and the quality of diagnosis as well as treatment.
• Post-diagnosis care management: Allow user to intelligently manage personal medication records, remind them when to taketheir medication, and enable them to search for their blood testing reports. Wan Xiao-fang will also ask patients actively tofind out if their symptoms have been improved, and recorded the changes in symptoms, which will serve as reference for the
next visit.

By the end of 2019, the total number of users has reached 17,213 person.

DeepQ Medical Encyclopedia
DeepQ Medical Encyclopedia is committed to provide general public with content
that is reliable and easy-to-understand to reduce the general public’s burden fromreading medical science related articles. From the needs and perspective of thegeneral public, an encyclopedia consisting of 1,000 articles on diseases has beencreated to enable the general public to quickly and accurately grasp the definitionof the disease, symptoms, etiology, diagnosis, treatment, and medicine references.
After the publication of DeepQ Medical Encyclopedia, it received a majority of the
public’s response. In the future, it will combine with medical artificial intelligenceand medical services to become a medical education platform for interaction between the public and medical personnel

The Upgraded Disease Control Butler LineBot-UP UP 3.0
HTC DeepQ cooperated with the CDC (Taiwan Centers for Disease Control) to develop the Disease Control Butler LineBot in 2017.
In 2019, the Disease Control Butler was upgraded to version 3.0, which is able to provide vaccination consultation and reminding
services for pregnant women and infants, becoming a good helper for mothers.
For the upgraded “Disease Control Butler 3.0”, parents simply need to enter the date of birth of the child and it will automatically037

Corporate Social Responsibility Management

Virtual Clinic to Emphasize the Doctor-Patient Shared Decision Making
HTC DeepQ is committed to creating a virtual clinic that implements Shared Decision Making (SDM). Besides the opening of
the virtual clinic in the Tri-Service General Hospital, we will also collaborate with Taipei Municipal Wanfang Hospital to create
the “VR Group Health Education Clinic” in 2019.
By adopting the VIVE Focus in the clinic and using the VR human body model to communicate diagnosis and treatment
content, doctors and family members can break the limitations of time and space. After wearing the VIVE Focus, users canenter the same virtual reality world to hear doctor explaining about organ structures and surgical methods. With this advanced
VR technology and the interactive interpretation by the doctor, the best communication and diagnostic/treatment results canbe achieved.
HTC 2019 CSR Report 038

Goal 4:

Quality Education
With quality education, virtual reality technology and education combined and a full range of software andhardware support, VIVE visualizes abstract knowledge, turning learning into an experiential journey immersed
in virtual space and fully revolutionizing existing forms of education. HTC has also applied VIVE interactive
media features in anatomy, first aid, and other medical education training, turning the human body structure
into VR content, breaking the physical constraints, and achieving half the work, twice the learning result.

DeepQ Deep Learning Competition
HTC DeepQ Health and Medical Division held the 2nd and 3rd DeepQ Deep Learning Competition in 2019. The
topics of both competitions were based on medical image analysis. The first competition was for the classificationof X-ray images when there were only X-ray images available, and the second competition was for the detection ofpneumonia lesions from X-ray images. In the first competition, a total of 9 groups, 30 students participated in theevent, and 17 students won the prizes. In the second competition, a total of 9 groups, 34 students participated in theevent, and 26 students won the prizes. The total prize for each competition was NT$ 40,000.

Goal 17:

Partnerships for the Goals
Promote partnerships that facilitate goal realization. HTC and many core strategic partners haveachieved cross-domain cooperation to further expand the VIVE ecosystem.

National Defense Medical Center
Partners with HTC DEEPQ to Create
Future Accurate Anatomy Teaching
The National Defense Medical Center and HTC DeepQ
continue to strengthen the development of new-generation
anatomy VR teaching materials, allowing students withinterest to learn independently. The teaching material can be
adjusted according to the students’ VR anatomy assessment
results, creating personalized and accurate teachingmaterials. Next year’s international symposium will share
the teaching experience of flip anatomy.

HTC DeepQ Joins Hands with Changhua Christian Hospital to Launch “Dr. Lan”,
the First Cross-Hospital AI + Blockchain Medical Care Chatbot in Taiwan
HTC DeepQ launches the “Dr. Lan Medical Care Chatbot-LINE Bot”, which is the first artificial intelligence (AI) + blockchain
medical care chatbot across 10 hospitals in Taiwan. It uses DeepQ medical blockchain technology to strengthen the information
security of inter-hospital medical care network. From AI medical department guidance, pre-consultation question to personal
health education after consultation, it combines with the medical blockchain information security to start a comprehensive
medical care in 10 hospitals in just one click, completely upgrading the medical care quality and experience before, during andafter medical treatment.

Co-produced the “Hospice Care VR Teaching Program”
with the School of Nursing, National Taiwan University
In the final journey of life, how to achieve the state ofno regrets between life and death is a challenge thatevery medical staff must face. HTC DeepQ Health Care
Division and the School of Nursing, National Taiwan
University jointly developed the Hospice Care Teaching
Program. By using 360-dgree panoramic videos as themain medium and the VIVEPAPER platform developedby HTC, the panoramic-video based interactive teaching
program was created. The objective of this project is tohelp nursing students understand the problems faced bypatients and their families at the end of life through theunique “immersion” of VR technology, allowing themto fully experience the atmosphere during the actual
clinical work. This teaching program allows students togo beyond the “knowledge and skills”, and to enhance the“attitude” of learning. Through four different scenarios, students can develop correct clinical thinking, including:humanized remain caring, saying goodbye and no regrets, death preparation and respect, psychological peace andreconciliation. The joint results with the School of Nursing of National Taiwan University participated in the 2019
Healthcare Quality Improvement Campaign (HQIC) Award (in the Smart Medical Category), which is an excellent
demonstration of cross-field cooperation between VR technology and nursing education.
039

Corporate Social Responsibility Management

Among them, the AI medical department guidance uses the “Taiwan Computing
Cloud” of the “National Center for High-Performance Computing” to accelerate
deep learning. Through accurate and warm Q & A, smart medical care reduces
the communication cost between “doctor-patient”. As for the blockchain, we
collaborated with National Taiwan University and Stanford University to codevelop the Multilayer Blockchain for Healthcare technology, which solves theconflict between the nature of traditional blockchain and the privacy of medical
data. This not only enables medical data to be shared across hospitals, but alsoenhances the protection of medical data for the public, extending medical carefrom within a single hospital to out-of-hospital medical care, and building acomplete medical care network. Such achievement is an important milestone
towards accurate medical care.

HTC 2019 CSR Report 040

Responsibility
Management ___Corporate Governance
We place great importance on corporate governance and operational transparency, and have formulated andimplemented corporate governance guided by the Company Law, Taiwan’s Securities Exchange Act, and otherrelevant laws to continue improving our management performance, and protect the interests of our investors
and other stakeholders through the comprehensive and systematic implementation of CSR.

To achieve this high standard, we formulated the HTC Corporate Governance Framework in 2014, which
has been approved by the Board of Directors and complies with the “Corporate Governance Principles for
TWSE/GTSM Listed Companies” as a basis for establishing an effective corporate governance structure . The
objectives being:
1. Protect the rights and interests of shareholders.
2. Strengthen the powers of the board of directors.
3. Fulfill the function of the Audit Committee.
4. Respect the rights and interests of stakeholders.
5. Enhance information transparency.

Organization Structure

AGM

Board of Directors
There are seven directors on the HTC Board (including three
independent directors), the group of directors includes one
female director and is primarily responsible for setting andmonitoring management goals and long-term business strategy.
They are also responsible for maintaining an internal financial
and accounting inspection system, assessing operating risks, andproposing strategies for the reduction of such risks.

Board of Directors
Chairwoman

The compositionof HTC Management (Directors)
by Age & Gender
Breakdown by Age

Male

Female Total<30 (Excluding 30)

0

0

0

30 ~ 50000>50 (Excluding 50)

6

1

7

Total

6

1

7

Independent Directors
Audit Committee
Compensation
Committee
Internal Audit

HTC believes that good corporate governance is critical if a business is to gain the long-term funding that
underlies further investment and growth. We recognize that to achieve good corporate governance, it isnecessary to widen the scope of independent viewpoints in order to win the trust of the public and theshareholders. During the re-election of board members (directors and supervisors) in 2019, During the reelection of directors in 2019, three independent directors were elected according to the provisions set forthin the Securities and Exchange Act. This action served to solidify our corporate governance, strengthen the
independence and functions of the directors, and improve the general performance of the Board of Directors.

Compensation Committee
Chief Executive
Officer

The Compensation Committee is set up under the HTC Board of Directors. The committee is comprised of an
independent director, and two independent external experts. The Compensation Committee assesses the salary
remuneration policies and system of the Company directors, supervisors, and managers from a professional andobjective viewpoint. The committee also makes suggestions to the Board of Directors for discussing. For HTC
corporate governance organization and members, please refer to Page 28 in 2019 Annual report.

Audit CommitteeCore Products
andServices

043

Responsibility Management

New Platforms
andInfrastructure

Innovation
Research andDevelopment
CenterCorporate
Functions

HTC established the “Audit Committee” to replace the Supervisors, which is composed of all independent
directors. The Audit Committee assists the Board of Directors in fulfilling the quality and integrity
requirement while carrying out the company’s supervision work in accounting, auditing, financial reporting
process and financial control. The Audit Committee has the right to conduct any appropriate audits andinvestigations, and has direct communication channels with the company’s internal auditors and independentaccountants. The Audit Committee convenes a meeting at least once a quarter. The audit supervisor andaccountants should report on audit and financial statement review results, and report important discussions
and resolutions to the Board of Directors.

HTC 2019 CSR Report 044

Complete Disclosures

Strict Mechanisms for Avoiding Conflicts of Interest

HTC is committed to improving the immediacy and transparency of information disclosure. In addition to
the timely disclosure of important financial and business-related information at the Market Observation Post
System in accordance with regulations, it also actively participates in forums and investor conferences organizedby domestic and foreign securities firms to help investors understand more about HTC’s financial and businessinformation.

To prevent potential risk of corruption and being unethical, in addition to “Anti-corruption and Bribery
Statement ” passed by the chairman of the board, HTC has established “Rules for Derivatives Transaction”,“Credit Policy & Operational Procedure”, and “Regulations for the Appointment of Directors/Supervisors
in Re-investment” and has revised the “Operational Procedures for Transactions of Specific Companies,
Business Conglomerates, and Parties”, “Regulations for Budget Management”, “Regulations for Managementof Subsidiaries”, and “Operational Procedures for Processing Internal Material Information and Preventing
Insider Trading” as bases for internal operations. Also, in its Rules of Procedure for Board of Directors Meetings,
it has duly set out a system for recusal and avoidance of conflicts of interest by directors, for compliance in theoperations of the board of directors.

We disclose our practice of corporate governance and legal compliance on the company website. For more
information about HTC governance policy and other related guidelines, please visit http://tw-investors.htc.com
Diversified Channels for Transparent Information Disclosure

Spokesperson & Deputy
Spokesperson

In accordance with the “Corporate Governance Principles for TWSE/GTSM
Listed Companies”, a spokesperson and acting spokesperson are appointed
to ensure that information that may affect the decisions of shareholders andstakeholders can be promptly disclosed.

Press Release, Press
Conference & MediaInterview

The company’s latest developments are also communicated to our investors
and the public through press releases, press conferences, and media interviews.

Website Platform

1. HTC has established an Investor Relations Website (in both Chinese and English)
through which the investors can access and download the company’s financial
statements, annual reports, other financial news, information about investor
conferences, and correspondence with shareholders. In the “Investor Service”
section, contact information and electronic forms are provided for investors tomake contact with the Investor Relations Division by phone or by email.
2. The Investor Relations Website is continuously maintained and updated withthe latest HTC Company development information.
HTC will continue maintaining and updating relevant and material company
information, so that investors can get the latest news.

Investor Conference &International/Domestic
Investor Forum045

HTC participates irregularly in international and domestic forums held by foreign
brokers. Details of these are provided to explain company operation, financial
profile, strategic development, and business policies to the investors.

Responsibility Management

After the establishment and subsequent revision of the “Operational Procedures for Processing Internal Material
Information and Preventing Insider Trading,” the company makes internal announcements to all employees
through e-mail, and also posts related information to our Intranet website. Furthermore, the latest version of therules is always accessible for immediate reference on the corporate website and on the Intranet.
In addition, as clearly set forth in the HTC Employee Manual, involvement in fraud, bribery, embezzlement,
and violation of business competition limitation may lead to a punitive dismissal. Any reports about the above
offenses may be sent to the heads of the related departments, the Human Resources Division, or the auditing
unit. The Human Resources Division is responsible for disciplinary action. A dedicated reporting channel (anticorruption@htc.com) has also been established for employees to expose any improper behavior that comes totheir attention. There were no corruption related events in 2019.
When signing procurement contract or engineering contract with the suppliers or manufacturers, HTC
will require its suppliers or manufacturers to sign the “Integrity Policy Statement” or the Letter of Integrity
Commitment which specifies that the cooperating partners should abide by the national laws and shall notacquire business or work advantages through improper conduct (such as offering kickbacks, banquets, or otherimproper interests). The contract clearly states that HTC will take the initiative to terminate any collaboration
with suppliers or manufacturers who violate the “Integrity Policy”. If damage has been occurred due to violationof the Integrity Policy, reimbursement shall be provided by the violating party to ensure that both parties are inline with the Integrity Policy.

Internal Audit System
HTC has set up our internal audit unit as subordinate to the Board of Directors. The internal unit is responsible
for assisting the Board of Directors and management in checking any defects in internal control and in theassessment of operational efficiency and performance, as well as the accuracy of the financial statements andcompliance with the related laws. The unit also addresses areas that need improvement in a timely manner toensure internal control is continuously and effectively implemented. The audit results are used as a basis for thereview and amendment of the internal control system to advance sound management in HTC. There were noanti-corruption related risks in 2019.

HTC 2019 CSR Report 046

Risk Management
HTC manages corporate risk with a focus on sustaining value for the shareholders and stakeholders. We
have established an appropriate control mechanism after careful consideration of all the various operational
uncertainties that ensures a rapid response to uncertainty, as well as to any attendant risks and opportunities.
Such careful risk management enhances our ability to create value.

Management of Operating and Financial Risks
HTC has never made high-risk, high-leverage investment, yet, as a part of our long-term business strategy, weare still positively evaluating the risks and benefits of introducing new technology. To remain responsive to thepotential risks caused by increased costs as a result rapid industrial development, we control operating costrisks by strengthening the functions of our products, reducing overall costs, and strictly controlling expenses.
Due to fast and fiercely changing global financial markets, foreign exchange movements will trigger thechallenge of business operation and thus influence shareholder’s rights. As a result, HTC has adopted relevantrisk management policies and standards for measurement of risk. In this regard, we have set up the funds
management practice, which clearly stipulates the tools and decision-making processes.
In 2019, HTC foreign exports accounted for around 73% of our total business revenues. HTC’s revenue
is mainly based on the US dollars and Euros, the manufacturing costs are also based on US dollars, so thesignificant fluctuations in the international exchange rates may affect the operating income, operating costs
and operating net profits in foreign currency denominations. In addition to strengthening the control of
quality and collection cycle of foreign currency accounts receivable, we also mainly avoid the operational riskof operations with the Foreign Exchange Forward Contract. In the future, we will strengthen the automatic
hedging effect of foreign currency claims and liabilities offset, using auxiliary tools such as derivative financial
products to conduct hedging under the appropriate risk guidelines.

Privacy protection and information security risk management
Protecting the company’s R & D achievements and customer information is the duty andresponsibility of all HTC employees. In order to ensure that information security andprivacy protection are fully integrated into the organization’s culture and the company’s
core values, HTC actively establishes and promotes information security and personal
information protection policies, ensuring that they are in compliance with relevant
information security and privacy protection regulations from various countries.
In order to fulfill privacy protection and information security requirements, HTC
organized a team dedicated for privacy protection and information security, which iscomposed of legal, product security and information security departments, ensuring thelegality and security of privacy protection.
HTC’s privacy protection system complies with Taiwan’s Personal Information Protection Act, and refers toapplicable international privacy protection regulations, such as the General Data Protection Regulation theEuropean Union, the Children’s Online Privacy Protection Act of the United States, and the California Consumer
Privacy Act. HTC also introduced the BS10012 Personal Information Management System (PIMS) developedby the British Standards Association for personal information management based on OECD, APEC and dataprotection laws, which includes 40 management policies and guidance documents, and implemented thesepolicies in areas such as employee education and training, product development and design, manufacturer
management, and security incident management. HTC passed BS 10012 PIMS certification in December 2018.

047

Responsibility Management

HTC is committed to protecting the security of user data and giving users the right to manage their personal
assets. HTC complies with data privacy engineering requirements from the product design stage, including
privacy by design/privacy by default, and introduced the privacy and security design review process, which also
includes the software security review tool created based on the Building Security In Maturity Model (BSIMM)
to ensure that products and services meet the requirements of privacy protection and information security.
In order to ensure that HTC employees comply with the policies and guidelines issued by the “HTC Personal
Information Management System”, all HTC employees must complete privacy protection and information
security education, training and test every year, while personnel responsible for product development mustcomplete product security related education, training and test every year. In addition, HTC sends privacy andinformation security monthly reports to all employees, providing up-to-date news or policy announcements
on privacy protection and information security.
HTC requires its employees to abide by the “HTC Privacy Protection System”, and also requires its outsourced
vendors as well as cooperation partners to comply with applicable privacy protection regulations and HTC
privacy protection and information security requirements to jointly protect privacy and information security.
HTC attaches great importance to maintaining the value of customer data security and privacy. It provides
customers who use our products and services with the ability to control their privacy settings. It also provides
ways for customers to exercise their rights on personal information, including acquiring or removing thepersonal information collected or stored by HTC.
Structure of HTC’s personal information management system

New personal
informationcollection

Legal basis

Personal
information
behavior inventory

Information
protection impact
analysis

Product privacy and security (PPNS) design review procedure

Privacy and information security
monthly report
Annual employee privacy andinformation security educationand training
Personal information protection
policy and related guidelines
Annual privacy protection andinformation security audit

Outsourcing
and partner
management

Product online

Procedures forthe exercise ofindividual rights

Information
security accident
management

HTC 2019 CSR Report 048

For information security, HTC follows the ISO 27001 information security standards, establishes andpromotes various information security management systems, and is committed to passing on the importanceof “information security” to all employees, allowing employees to truly understand the company’s information
security policies and various security related solutions, especially in mobile application management, accountmulti-factor authentication, business collaboration, cloud services, etc., making “security” a part of employees’
daily life.
HTC sorts and classifies information assets according to information asset management standards, anddetermines the level of authorization required for issuing information. In addition, the company provides
approved data exchange channels as a way to transmit information within or out of the company.
HTC deploys multiple layers of network security mechanisms to protect the company’s e-networks andservices, including application firewalls, intrusion detection and defense systems, spam filtering mechanisms,
VPN access control management, and more.
In order to reduce the risk of operation management and ensure the continuous operation of businesses, HTC
has moved the core basic systems to the cloud and introduced various cloud services to create a cloud working
environment that advances with time. By utilizing the flexibility and high availability of the cloud, deploy anddisaster recovery can be performed quickly when failure occurs, effectively improving work efficiency.

Management of Climate Change Risk
As an answer to requests from customers, HTC joined the Carbon Disclosure Project (CDP)
in 2008. We voluntarily disclose information about our climate risks, future development
opportunities, emissions, and strategic management mechanisms. In 2019, HTC’s rating on the
CDP climate change questionnaire reached B level (the international average level is C).
In the 2019 CDP Supplier Engagement Rating (SER), HTC was rated as level A- (international
average is level C). The Supplier Engagement Rating uses the responses of the company’s CDP
climate change questionnaire in terms of governance, objectives, scope 3 emissions, and value
chain participation to evaluate the performance of supplier engagement.
In 2019, HTC continued to join CDP supply chain program members, and has required its major suppliers to
respond to the CDP questionnaire, actively contributing its corporate influence, and calling on its supply chain
partners to work together in carrying out further assessments and actions for climate change. The supplier
response rate in 2019 reached 61%, an increase of 13% compared to 2018.
Climate-related Financial Disclosure
Framework

Governance

HTC Action Plan
HTC currently does not have an independent group to discuss climate change related issues.
The Quality and Sustainability Management Department convenes HTC CSR committee
members based on industrial relevance to determine the potential impact of various issues on
the organization internally and externally, including the identification and assessment of climatechange related risks, and the responses to climate impact.
The manager of the Quality and Sustainability Management Department reports to the Audit
Committee under the Board of Directors every year on the annual CSR performance and goals
for the next year, including issues related to climate change.

Strategy

The smart mobile devices and virtual reality products produced by HTC, combined with a new
way of operation, life, work, learning and travel, will help users to achieve the goals of energy
saving and carbon reduction. Through continuous performance demonstration, management
mechanism promotion and system establishment, as well as planning at different stages ofenvironmental protection cooperation between society and enterprises, short-, medium- andlong-term goals of sustainable development can be achieved gradually.

RiskManagement

In order to identify and evaluate current and future activities related to sustainable operations,and products and services that may cause significant impacts or risks, the HTC risk assessment
team will conduct regular organizational risk assessments, including climate change status,
serving as a basis for formulating policies and goals. In the future, the risk assessment mechanism
recommended by TCFD will be introduced to assess specific issues of climate change and tounderstand potential financial impact.
The mid-to-long-term plan is to reduce carbon emissions by 5 ~ 8% in 2025 (2020 is selected as
the basis). For details, please refer to the “Green Management Vision and Short-, Medium- andLong-Term Plan” in P.62 of this Report.

Indicators and
Goals

Since 2009, ISO 14064-1 verification statement has been introduced and continuously acquiredin order to fully grasp the energy use. Therefore, energy-saving strategies and actions can be
determined and planed in response to international greenhouse gas and global warming issues.
Since 2011, ISO 50001 energy management system has been introduced so that energy
management can be implemented more effectively, achieving the goal of sustainable business
operations.

049

Responsibility Management

HTC 2019 CSR Report 050

Policy andLegal• Laws and standards of energy-saving products (i.e., California Energy Law, Energy Star,
ErP, etc.)

HTC climate-related risks and financial impact
Type• Regulations (i.e., Greenhouse Gas Reduction and Management Act in Taiwan)• Cost for low-carbon technology transformation• Replace existing products and services with low-carbon products

Resource
efficiency

Energysource• Long-term risk: Changes in rainfall (precipitation) patterns and climate patterns• Laws and standards of energy-saving products (i.e., California Energy Law, Energy Star,
ErP, etc.)• Regulations (i.e., Greenhouse Gas Reduction and Management Act in Taiwan)• Use low-carbon energy• Develop or increase low-carbon products and services, develop climate adaptation solutions• R & D and innovation to new products and services• Diversified business activities• Enter new market

MarketResilience051• Make good use of public sector
incentives

Riks• Participate in renewable energy projects and adopt
energy-saving measures

Responsibility Management

Strategy
Planning
Risk
Management

Opportunity

Physical risks

Product
and Service• Immediate risk: Increased severity of extreme weather events such as typhoons and floods

Transition risks

Physical
Risks

Potential financial impact

Responding actions in 2019

1. Increase of operating costs (i.e.,
increase of compliance costs andcosts for raw materials and parts)
2. Writing-off and advance retirementof the existing assets due to policychanges
3. Increased costs and/or reduced
demand for products and services
due to fines and court decision

The options for alternative
materials were increased to reduce
the risk of selecting materials
from single source. On the other
hand, through large number ofpurchases, the purchase cost of
related components was reduced
to achieve optimum cost structure
24 energy-saving projects were
implemented in 2019, which saved
419,895 kWh of electricity

1. Unsuccessful
investment in newtechnologies
2. Transitioning to lower
emissions technology
3. Substitution ofexisting products andservices with lower
emissions options

1. Capital investment for technology
development
2. New and alternative technology R& D expenditure
3. Decreased revenues due to reduced
demand for products and services
4. The cost for adopting/building newpractical operations and processes

Sustainable design of products,
such as improving energy efficiency,
recycling and reducing harmful
substances, was implemented toenhance the green competitivenessof products

Acute risk
Increased severity andfrequency of extreme
weather events such as
typhoons and floods

1. Decreased revenues due toreduced production capacity(such as production line shutdown,transportation difficulties, andsupply chain interruption)
2. Labor power of employees isaffected, resulting in reduced
profits and increased costs (i.e.,
health, safety, absence from work)
3. Unstable room temperature, which
affects the lifetime of instrument
and equipment. Decreased asset
value or asset useful life leading towrite-offs, asset impairment or early
retirement of existing assets, which
increases the infrastructure cost

Continued to acquire the ISO
14064-1 verification statement tofully grasp the energy use, andimplemented energy management
systematically in accordance with
the ISO50001 energy management
systemPolicy and Legal• New technology investment failure

Technology

Climate related risks

1. Laws and standardsof energy-saving
products
2. Local regulations(i.e., Greenhouse
Gas Reduction andManagement Act in
Taiwan)Technology

Chronic risk
Changes in precipitation
patterns and extreme
variability in weather
patterns

Financial
impact

HTC 2019 CSR Report 052

HTC climate-related opportunities and financial impact
Type Climate related opportunities

Resource efficiency

1. Use of recycling
2. Move to more efficientbuildings
3. Reduced water usage andconsumption

Energy source

1. Use lower-emission sourcesof energy

Potential financial impact

Reduce operating costs (i.e.,
reduced costs through the useof solar energy and recycling)
Increase the value of fixed
assets (i.e., high-efficiency
green buildings)

Waste reduction strategy was
adopted; continue to reduce waste
generation from the source throughclassification and waste-reduction
promotion, and take recycling as
the first consideration to increase
the reutilization of resources

Benefits to labor
management and planning(i.e., improved health andsafety, employee satisfaction),
which reduces costs

Continued to promote themanagement of energy
performance through various
energy-saving improvement andmanagement programs such as
improvement of building lightings
and air-conditioning systems

Reduce operating costs(i.e., reduced costs throughthe use of solar energy)

Continued to use green energy,
including the use of lowpolluting energy sources andequipment such as solar panelsand heat pump systems. Building
a low-carbon life through theimplementation of various
energy-saving measures such as
improvement of lightings and airconditioning systems, and theoffering of shuttle buses for work

Products and services

1. Develop or expansion
low emission goods andservices

Increase revenue throughthe demand for low-carbon
products and services

2. Development of climate
adaptation, resilience andinsurance risk solutions

Increase revenue by
developing new solutions
that meet the needs ofclimate adaptation (i.e.,
VIVE virtual reality productapplications and services)

3. Development of new
products and services
through R & D andinnovation

Responding actions in 2019

The use of VIVE virtual reality
product applications and services;
Use of digital technology canshorten time and distance, which
in turn saves transportation
time and costs. VIVE enterprisesolutions help enterprise users to
expand their businesses, creating aframework for enterprise users toreach customers, develop products
and train employees in the future
For enterprise users, we publishedcontents for applications that are
related to training, health care,sports and education

1. Access to new markets
Markets
Resilience053

2. Use of Public-sector
incentives
3. Access to new assets
and locations needing
insurance coverage

1. Participation in renewableenergy programs andadoption energy-efficiency
measures
2. Resource substitutes/
diversification

Responsibility Management

Increased revenues throughaccess to new and emerging
markets (i.e., cooperate withgovernment, public agencies,
hospitals)

Improve market valuation
through resilience planning(i.e., infrastructure, land,buildings)

VIVE ORIGINALS- combines films,
cultural entertainment and art
industries, and is committed to the
production of original content. We
continue to receive subsidies from
the Ministry of Culture
VIVE Arts- uses cutting-edge
technology to create unique art
and cultural experiences that canbe enjoyed all over the world. We
continue to cooperate with theworld’s top art galleries, museums
and artists
Build solar power generation
systems, and connect the powerlines of the systems to the grid tosell the generated electricity backto Taipower, alleviating the power
loading burden in Taiwan andreducing carbon dioxide emissions

Innovative R&D Management

Future Goal
People-oriented:
Combining cutting-edge technologies such as VR, AR, AI, 5G, andBlockchain with arts and humanities to unleash people’s imagination.
Changing the way people interact, and the technology around the world.

Current Achievement
VIVE Pro Eye eyeball tracking upgraded; set a new standard for highend VR HMD(Head-Mounted display).
The subscribed VIVEPORT Infinity contents and services are unlimited;the contents to be experienced can be selected freely anytime.
The VIVE COSMOS and the VIVE Reality System has unleashed theunlimited imagination of the VR world.
HTC collaborated with content developing partners to create a newpattern of VR content.
VIVE FOCUS won the gold medal of IDEA 2018 (2018 International
Design Excellence Awards).
In January 2019, the HTC VIVE team won 36 global awards at theConsumer Electronics Show (CES) in the United States, an increase of
14 awards from last year.

HTC’s
Challenge
Expediting patent layout
Strengthening
advertising of productinnovation

HTC 2019 CSR Report 054

HTC VIVE selected as the world’s most innovative company in 2019

HTC was selected as the 2019 World’s Most Innovative Companies by the US business technology
magazine, the “Fast Company”, and won the 3rd place in VR/AR category.
HTC’s core mission is to create the most innovative VR experience for the public. The editor of the “FastCompany” magazine mentioned in the forward that: “Since the launch of VIVE in 2016, it immediately
became the benchmark for the quality and features (for VR devices)”. This achievement of being
selected as the most innovative companies in the world in 2019 affirms HTC’s continuous effort as wellas the latest development in high-end VR. It not only demonstrates HTC’s top technological capability
and content, but also its hard work in the ecosystem with different hardware/software platforms,
continuing to lead the innovation of top VR experience in design and technology.
HTC’s award record in “Fast Company”
2019: Virtual/Augmented Reality
2017: Augmented Reality/Virtual Reality
2010: Top 50, Consumer Electronics, Mobile055

Responsibility Management

Engaging Diversified R&D Talent
In 2019, a total of 1,789 R&D workers
Investment in Innovative R&D
joined HTC globally. In addition to thosein Taiwan, we have many R&D employees
Unit
2017
coming from, or based in, other countries,
Fixed R&D Investment
Million(NT)10,440such as Europe, America, and Asia.
We expect that the different cultural
Total Revenue
Million(NT)62,120backgrounds of our diverse employees will
Percentage%
17
fuse and fuel innovative thinking, so as
to support HTC in the development andNote: The related figures are those listed in the consolidated statement.
launch of products that meet consumer
needs in different regions and with different cultural characteristics.

2018

2019

7,070

5,652

23,741

10,01530

56

Since our establishment, HTC has invested heavily in cultivating R&D talent and developing technicalinnovation. Currently, our in-house R&D employees make up 45.81% of all HTC’s global employees, theinvestment of which is about 56% of the total operating revenue. With this strength of innovation, HTC has
special insight into industry trends and the outstanding capability for meeting consumer demand. This puts
HTC always in the lead.

TaiwanOthers2019
R&D
Personnel
1,789

Taiwan Others

Taiwan Others

2018
R&D
Personnel
1,821

2017
R&D
Personnel
3,865

HTC 2019 CSR Report 056

Smart Innovative Products
With this strength of innovation, HTC has special insight into industry trends and the outstanding capability
for meeting consumer demand. This puts HTC always in the lead. In October 2019, HTC launched EXODUS
1S, the world’s first smartphone that natively supports Bitcoin full nodes, continuing the integration of HTC
EXODUS 1’s revolutionary blockchain with innovative smartphone technology, and offering mobile encryption
and reliable blockchain application to new customers.

THE FIRST SMARTPHONE TO PUT A FULL BITCOIN NODEIN YOUR POCKET-EXODUS 1S“EXODUS is about empowering the user”- HTC gave users
the ability to own their own keys, and now HTC had gone
one step further to allow users to run their own full Bitcoinnode. Full nodes are the most important ingredient in theresilience of the Bitcoin network and HTC had lowered thebarrier to entry for any person to run a node, which is simply
a mobile phone, participating in the global Bitcoin networkthat propagates transactions and blocks everywhere, whichis the foundation and fundamental definition of a eer-to-peer
cash system.
EXODUS 1S is the first smartphone with full node function,
which contains a complete Bitcoin blockchain to provide atruly decentralized experience. Having a complete node is
the only way to realize the full privacy of using Bitcoin andfull nodes are the key to ensure the future development of
Bitcoin. EXODUS 1S can make users from the emerging
economies or those who want to explore the encryption
world to enter this field more easily, helping promote mobile
encryption technology and blockchain applications to the
public, and increase their popularization and usage around the world.
Phil Chen, HTC Blockchain Chief, said: “EXODUS is about empowering the user. We gave users theability to own their own keys, and now we’ve gone one step further to allow users to run their own
full Bitcoin node. We are providing the tools for access to universal basic finance; the tools to have ametaphorical Swiss bank in your pocket. Full nodes are the most important ingredient in the resilienceof the Bitcoin network and we have lowered the barrier to entry for any person to run a node, which
is simply a computer, mobile in our case, participating in the global Bitcoin network that propagatestransactions and blocks everywhere, which is the foundation and fundamental definition of a peer-topeer cash system.”.
EXODUS 1 is the first smartphone ever built for the new Web 3.0 Internet. HTC EXODUS 1s will make iteasier for users to explore and use key blockchain technologies.

057

Responsibility Management

HTC joined the newly created blockchain venture capital“PROOF OF CAPITAL”
In April 2019, HTC joined the newly created blockchain venture capital, “PROOF OF CAPITAL”,
and it is the most important investment partner. Proof of Capital is a venture capital that focuses onblockchain and has a fund of 50 million US dollars. It aims to build an Internet ecosystem for everyone
and lead the global users to adopt blockchain technology, indicating that HTC has made efforts tobringing better privacy and security protection for global users, and is committed to the development ofblockchain technologies and applications.
In 2019, the cooperation between MWC Barcelona and Opera further simplified the originally
cumbersome steps, and opened more convenient and friendly interface, allowing more interested
consumers to enjoy blockchain applications together with EXODUS.

Furthermore, HTC also devotes to the wisdom of the medical field by creating HTC Healthcare business unit
through virtual reality / augmented reality, big data and artificial intelligence technology, with the goal ofdeveloping and providing precision personalized medical products and services to reduce costs and improvethe effectiveness of healthcare.

HTC Launched the DeepQ AI Platform
In May 2018, HTC’s Health and Medicare Division, DeepQ, released theartificial intelligence (AI) platform – DeepQ AI Platform, which provides a fast,easy and efficient solution for problems encountered during the deploymentof artificial intelligence (AI), stimulating more innovative AI applications.
The DeepQ AI Platform can dramatically reduce the learning thresholds and the cost of AI training
models through optimized training environment, built-in multiple AI models, fully automatedparameter adjustments, and simple user interface. Different from the AI training platforms and services
available on the market, the users of DeepQ AI Platform can quickly convert their own tagged data into
deployable AI models without having to write and design deep learning programs.
The DeepQ AI Platform not only allows general users and business users to operate easily, but also
effectively reduces the labor and time costs for developers who have AI related expertise and experience.
In September 2019, the medical application DeepQ AI Platform was launched. It is composed of DeepQ
AIP workstation and NVIDIA DGX-1 device, and is designed to operate in the hospital IT environment.
Doctors can quickly convert their marking data into deployable AI model training without the needof writing and designing deep learning programs. It is a new design concept in medical artificial
intelligence model training application-“UaaD (User as a Developer)”.

HTC 2019 CSR Report 058

Supplier Management
Protection of IP Rights
HTC regards R&D and innovation as an essential force needed for the company to remain sustainable andcompetitive. In particular, the protection of intellectual property rights is a key to maintaining our brandvalue. The protection we put on our intellectual property rights covers four areas: patents, trademarks,
copyright, and trade secrets. Of these, patent protection is particularly valued and is realized at two levels:

Positive filing of patent applications to protect the results of our various product R&D andtechnical innovation.

Internal

Setting up a dedicated unit under the Legal Affairs Division for the protection and dispute
resolution of intangible assets such as patents, trademarks, copyrights and business secrets.

Engaging in technical cooperation with leading domestic and foreign research institutions,providing top talents with the opportunity to receive practical training in HTC, thereby fueling
our R&D with innovative thinking.
Mergers and acquisitions company to obtain key technologies and patents to speed up
research and development.

In terms of patents, HTC has not only actively defended patent lawsuits against patent trolls, as well as filingan infringement lawsuit against HTC in courts in America, China and countries in Europe in order to protect
the rights of HTC. In order to strengthen the competitive advantage of products, HTC has also obtained patentauthorization from major international companies in order to rule out obstacles of patents.
In terms of trademarks, HTC has actively applied for trademark registration in various countries in order toacquire important trademark rights. HTC has also actively and closely worked with customs and local police
agencies in various countries to crack down on counterfeited goods and protect HTC’s business reputation.
HTC has also actively investigated the situation of HTC’s registered trademark abuse in various countries, andactively took legal actions with law enforcement agencies in various countries to protect the company’s rights
and interests.
Additionally, in terms of copyrights and business secrets, HTC clearly stipulates employees’ intellectual
property rights in the employment contract and demands employees to comply with HTC’s intellectual
property related regulations. The Ministry of Justice also collaborated with the Information Center, strictly
restricting employees’ internal data access authorization, such as software program codes, R&D data, unlisted
product business information, etc. In addition, in order to prevent leakage of business secrets, program codes,
or confidential Information, HTC has also set up relevant regulations for the management and has signed aconfidentiality contract with specific persons in order to protect business secrets.

059

In 2019, HTC continued to be a member of the Responsible Business Alliance (RBA) and has formulated an “HTC
Supplier Code of Conduct” according to Responsible Business Alliance Code of Conduct, with the aim of working
with our supply chain partners to protect the environment, uphold the human rights of our workers, their ethics,
safety and health, and extend this social responsibility to the supply chain system.

Holding regular training courses for R&D staff about IP management.
Encouraging our employees to invent and create.

External

Suppliers are a vital factor for the continued success of HTC, we were founded in Taiwan and are a Taiwanesecompany whose operations and procurement drives the development of the related sectors. Besides key
components, we try to purchase local raw materials and related equipment. The amount of local raw materials
purchased accounted for 53.33%. While demanding high-quality services and products, we also use high ethicaland environmental standards to manage our supply chain.

Responsibility Management

HTC Supplier Code of Conduct
The HTC Supplier Code of Conduct details the responsibilities and regulations that have to be followedby all suppliers doing business with HTC. In addition, HTC also conducts a regular assessment of theimplementation of the Code as the basis for our further selection of business partners. At the end of
2019, there were a total of 197 suppliers signed the Supplier Code of Conduct, with the rate of signing
reached 100%. Five new ODM suppliers were added in 2020. They are expected to sign and return the
Supplier Code of Conduct by the end of March 2020.
The provisions about labor issues, health and safety, and ethics were framed with reference to
Responsible Business Alliance Code of Conduct and the related documents issued by the United
Nations Universal Declaration of Human Rights. For more information about the “HTC Supplier Codeof Conduct,” please visit http://www.csr.htc.com
Mid- and Long-term Goals for Supplier Management2019
1. First-tier suppliers sign the“Supplier Code of Conduct”,
with a signing rate of 100%
2. The Tier 1 suppliers response
rate for the investigationof banned and restricted
substances- 100%
3. The Tier 1 suppliers response
rate for the GHG Emission
Disclosure survey form -100%
4. 100% no conflict minerals(3TG)

2020-2021

2025

1. First-tier suppliers sign the“Supplier Code of Conduct”,
with a signing rate of 100%
2. The Tier 1 suppliers response
rate for the GHG Emission
Disclosure survey form -100%
3.		100% no conflict minerals(3TG)
4.		The Tier 1 suppliers response
rate for investigation withnew conflict mineral, cobalt-100%2019 Supplier Management

1. First-tier suppliers sign and abide by
the “Supplier Code of Conduct”, witha signing rate of 100%
2. Promote the implementation of
power saving measures for first-tiersuppliers:• The Tier 1 suppliers response rate
for the GHG Emission Disclosure
survey form -100%• The Tier 1 suppliers implementationof power saving measures
accounts for 50%

Amount (NT million)

Percentage of Total
Purchase Amount (%)

Interests with HTC’s
stockholders

Others

5,399

100

-

Total Purchase Amount

5,399

100

-

HTC 2019 CSR Report 060

The green supply chain management system

The HTC Supplier CSR Assessment and Audit

HTC has had a green supply chain management
platform since 2006 to assist R&D engineers to
select green materials from the product databasethat comply with both International regulations
and customer requirements. Green materials
are used from the start of design to significantly
enhance the reliability and related validation
process and schedule of green products.

In addition to implementing corporate social responsibility of our own brand, HTC also delivers the concept
and requirements of CSR to the supply chain. We established the CSR unit in 2010 and then initiatedinvestigations of those suppliers who had implemented CSR. This was not only to verify their compliance ofthe HTC Supplier Code of Conduct, but also to provide supplier consulting and coaching functions to build andenhance CSR concepts and actions with.

The survey of new suppliers shall comply with
the HSF scoring standard. As for the existing
suppliers, the HSF performance evaluation wasadded to the Supplier Performance Management
System since 2016. Improvements are reviewed
and checked via the implementation of thequarterly supplier meeting. Two of these
suppliers have HSF issues in 2019 and both havebeen improved.

Owing to differences of industry characteristics and supplier category, HTC
identifies critical supplier and major audit for reference by following two
principles:
1 Suppliers’ annual amount of transaction representing more than 10% of
total purchase.
2. According to the components which vary based on technology, markets
and purchase annually, CSR and sourcing departments define criticalsuppliers of current year based on different situations every year.

A Quick Look at the HTC Supply Chain Management

Definition of HTC
Critical SupplierSelf-assessment
SurveyAll candidate suppliers are required to fill in the Self-assessment. Since
2016, the weight of CSR-related questions in the Self-assessment survey
for new suppliers was increased. During each quarterly supplier review
meeting, the CSR-related performance of major suppliers will be checkand the results will act as the reference for the supplier screening process.
For new suppliers, the CSR self-assessment questionnaire must be filled
and returned. The content of the questionnaire is designed based on thefive major aspects of HTC’s Supplier Code of Conduct: labor, environment,
health and safety, ethics and management system. Supporting information
is provided for inspection.

On-site Audit“Supply Chain CSR Compliance Audit“ has been implemented since2011. 20 major component suppliers will be chosen every year to accept“Supply Chain CSR Compliance Audit“ based on initial risk determination(including geographic, location, products, news, etc.)
In 2017, an addition was made in the manufacturing process. According
to the RoHS and REACH directives, hazardous substances subject tocontrol are required to be audited.
On-site audit for 15 suppliers had been completed in 2019, and 3
suppliers were submitted RBA-VAP audit reports. The 2020 Supply
Chain CSR Compliance Audit will be kick off in the 4th quarterly 2020.

Management
Mechanism

On-site Audit Results(Total of 287
Noncompliance
Items in 2019)061

Responsibility Management

Labor Rights

72 cases, mainly about overtime.

Health and
Safety138 cases, mainly on insufficient occupational safety measures in theoperating environment.

Environment

60 cases, mainly about Inadequate hazardous waste management
measures, followed by energy consumption and greenhouse gas emission,and production material control issues.

Ethics

17 cases, mainly for the failing of establishing management proceduresfor employees to accept inappropriate payments and gifts, followed byresponsible sourcing of minerals.

Treatment andResponses

In response to the above findings, besides requesting the suppliers to
respond with improvement measures, HTC also provided management
system and implementation experience to suppliers for reference and put
them in the priority list for on-site audit in 2020 in order to prevent similar
incidents from happening.

HTC 2019 CSR Report 062

Audit Result of 2019
Water Management
Non-Discrimination

4%

3%

Solid Waste

Product Content Restrictions

Environmental permits

Freedom of Association

6%

and Reporting3%

Humane Treatment

6%

Air Emissions

5%

2%

Hazardous

Wages and Beneﬁts

11%

2%

36%

Substances

Labor Rights
Working Hours

49%

Environment

Pollution Prevention
and Resource

22%

Freely Chosen
Employment

11%Child Labor Avoidance

13%

Energy Consumption andGreenhouse Gas Emission

27%

4%
Occupational Injury and Illness 4%
Physically Demanding Work

Industrial Hygiene

Machine Safeguarding1%

6%

Privacy

6%

Protection of Intellectual Property

6%

Business Integrity

Emergency
Preparedness

20%

Food, Sanitationand Housing

063

21%

Responsibility Management

Health and Safety

Occupational Safety

Protection of Identity

6%

12%

44%

Fair Business,
Advertising
and Competition

18%

No Improper
Advantage

29%

EthicsResponsible Sourcing ofMinerals23%

HTC 2019 CSR Report 064

No conflictminerals productused at HTC in

2019

Result as follows:

Responsible Procurement of Minerals
HTC has responded to the global boycott of conflict minerals, supports the Conflict-Free Smelter Program ,has promised not to use conflict minerals, and refuses to accept primary ore material from the Congo and theneighboring Central African countries in conflict.
In addition, through a responsible procurement practice, our suppliers and we shall comply with the “HTC
Conflict Minerals Procurement Policy” and reply the “CMRT” and “Conflict-Free Material Assurance Letter”
in a concerted effort to avoid all use of conflict minerals. HTC has not only monitored and managed its supply
chain and prohibited the use of electronic parts produced with the minerals but also supports the audit andcertification process of the minerals to ensure all the minerals HTC uses are conflict-free.
Based on Conflict Minerals Reporting Template, HTC set up KPI, tracking the progress of sign-back, in order
to effectively manage the supply chain and reduce the risk of breaching the contract. We have completed thedevelopment of products using conflict-free minerals in 2016. All minerals used in HTC products from the endof 2017 are CFSI qualified smelters. At the end of 2019, all suppliers also signed an agreement to ban the use of
conflict minerals, which will be updated annually. In response to international trends, HTC expects to conduct
a source survey of “cobalt” metal mines in 2020.

SWITZERLAND

RUSSIAN FEDERATION

5.5%

OF AMERICA

6.4%

GERMANY

7.3%

KOREA

The intended use of conflict minerals

Au

Intended use:
As circuit board contacts toensure proper connection

Sn

8.3%

20.2%

Gold

9.2%

OTHERS

37.6%

Point of use:
Soldering in the circuit boards
Intended use:
Solder to mount circuit board
electronic components
BRAZILW

JAPAN

UNITED STATESCHINAPoint of use:
Contact in the circuit boards

5.5%

8.5%

Point of use:
Tungsten Alloy used in Vibrator
Intended use:
Tungsten alloy used in the phone vibration motor

INDONESIAOTHERS

45.1%

22.0%

Tin

Ta

065

Point of use:
Tantalum-Capacitor
Intended use:
An element usedin tantalum capacitors

Responsibility Management

Co

Point of use:
Used on lithium batteries
Intended use:
As electrode material
for lithium battery

CHINA

24.4%

HTC 2019 CSR Report 066

Customer Relations
VIETNAM

7.0%

RUSSIAN FEDERATION

7.0%

While HTC makes mobile phones bearing our own brand, we also work with the world’s leading ICT dealers in
the development of customized handheld devices for them, or in the launching of ‘co-brand’ handheld devices
to further present our products to mass market around the world.

Protection of Customer Confidentiality
UNITED STATESOF AMERICA

9.3%

OTHERS

Tungsten

CHINA

53.5%

HTC makes a promise of “Strict observation of contractual obligations and confidentiality commitment” toall customers. All information we provide to our customers is subject to clear policies and a system of strict
internal control. In addition to technical data, hardware and software, information related to patents andother intellectual property rights of customers may be incorporated into our controlling system. We complete
confidentiality agreements with all customers and suppliers in advance to maintain the absolute security of all
the confidential information belonging to our corporate customers.
The HTC privacy policy is also incorporated in the orientation training of new employees. Every employee istrained in all aspects of maintaining confidentiality when working with customers. Under our solid control
mechanism, there was no damage to the rights or interests of any customer caused by a breach of privacy orfrom lost data in 2019.

23.3%

In response to the EU General Data Protection Regulations (GDPR) requirements that came into effect in May
2018, HTC promoted the Personal Information Management System within the organization to achieve goal ofprotecting personal information set for products and internal management processes.
GERMANY

7.5%

BRAZIL

7.5%

JAPAN

CHINA

12.5%

37.5%

Tantalum

OTHERS

17.5%
UNITED STATESOF AMERICA

17.5%

Note: In the smelter country display graph, the Others category is countries with a percentage value of less than 5%. The countries of conflict mineral smelters in this category are
as follows:
1. smelter countries of Gold include: Italy, Brazil, Canada, India, South Africa, Taiwan, Turkey, United Arab Emirates, United States, Andorra , Australia, Austria, Belgium, Chile,
France, Indonesia, Kazakhstan, Kyrgyzstan, Mexico, Netherlands, Philippines, Poland, Singapore, Spain, Sweden, Uzbekistan
2. smelter countries of Tantalum include: Estonia, India, Kazakhstan, Macedonia, Mexico, Russian Federation, Thailand
3. smelter countries of Tin include: United States Of America, Bolivia, Japan, Malaysia, Thailand, Belgium, Peru, Philippines, Poland, Spain, Taiwan, Viet Nam
4. smelter countries of Tungsten include Germany, Japan, Korea, Austria, Brazil, Philippines, Taiwan

067

Responsibility Management

HTC 2019 CSR Report 068

Global brand, local touch- A complete service for virtual reality ecosystem,
VIVE Leasing program

HTC VIVE
Production

Online Rental

Corporate Customer Satisfaction Management
HTC has established “Customer Satisfaction Management Procedure” to meet the specific needs of all ourcustomers and to respond to customer expectations and requests. A Quarterly Business Review is made to
determine customer satisfaction. Each Business Unit proposes corrective action for any nonconforming
project and regularly track any action taken to ensure that the customer has been perfectly satisfied.
The HTC customer satisfaction management index, in addition to product quality, delivery, and after-sales
service, includes evaluation of corporate social responsibility. We have designated a department to regularly
aggregate HTC CSR information for communication and response.

Participation in CSR Program Offered by the Client
In 2015 to 2018, we took part in the CSR program that Deutschen Telekom AG provided to suppliers. The
program, aimed at enhancing supplier social responsibility, includes 10 principles: corporate governance, anticorruption, supply chain management, environmental protection, production operation, safety and sanitation,
salary and benefits, employee satisfaction and turnover rate, improvement of the working environment,
and employee relations. After persistent effort over the past year, HTC won the Gold Award of the Deutsche
Telekom Supplier Development Program for two consecutive years in 2016-2017.

Process order

Arrangement

RepairGood Unit

Inspection

Broken

Waste
Delivery

ReturnProfessional
Installation

User Experience

Reuse

Disassembly

Scrapped

Scrapped

In September 2019, the “VIVE Leasing program” of HTC was nominated for the CSR Supplier Circular
Economy Best Practice Award organized by the Joint Audit Cooperation (JAC) in Europe. This Award aims toidentify the best practical cases and leadership of supply chain in the issue of circular economy. The actions wehave taken and the results achieved have been highly affirmed by the judges.
HTC VIVE is the best virtual reality brand, dedicated to creating high-quality VR software andhardware, and taking human imagination to places without the limits of reality. As the leading VR brandin Taiwan, we feel responsible for making VR experience easy and convenient for the public. Therefore,
since 2017, in order to make VR experience easy for everyone, HTC has released a VIVE rental plan in
Taiwan, providing installation services at an affordable price. Until now, the VIVE rental service has
attracted more than 50,000 users.
The VR rental service cooperates with professional logistics companies through an online rental
platform. Users can easily experience VR even in remote areas. Users can experience 15 types of VR
contents for free. The contents are not only fun but also including art and education. For example,
through the Lifelique VR Museum, users can observe cell, join ancient dinosaurs for a walk, or visit a
prehistoric settlement that dates back to the seventh millennium B.C.
After the user finishes the VR experience, HTC collects and inspects the VIVE product to see if it can berented again. If the product is damage, it will be repaired. The available parts in the scrapped productwill be given priority for repairing the damaged product. Through recycling, reuse and maintenance, therental service forms a small circular economy. So far, the VIVE products in the rental service have beenused for more than two years.
The courage to pursue dreams is our core philosophy. From the interconnection between customer
expectation and our capabilities, we look for core issues and propose astonishing innovative solutions.
For details of VIVE rental, please refer to: https://discover.vive.com/tw/rental/

069

Responsibility Management

HTC 2019 CSR Report 070

Sustainable
Agenda ___HTC
Sustainable
AgendaSustainable
Environment

Sustainable
DesignEnergy and climate change
Energy management system
Green facility
Water resource management

As a global leader in the innovative designof mobile phones, HTC recognizes that byminimizing the environmental impact of ourmanufacturing processes we, and our vast
number of consumers, can make a contribution
to the well-being of our planet. To this end, HTC
has set up a “Sustainable Agenda” from fiveaspects: “a sustainable environment, design,
processes, packing, and product”, we have put
this concept of environmental sustainability
into action, have positive control, and are
reducing the impact of our operations on thenatural environment.

Eco-design
Eliminating the use ofhazardous substances

Sustainable
Processes

Sustainable
Packaging

Sustainable
Product

Environment safety and healthManagement of hazardous
substances
Management of waste andchemicals

Green packaging material

Product Carbon
Footprint

Sustainable Environment
HTC provides and maintains a safe and healthy working environment as part of our environmental protection,
safety and health, and energy management efforts. In order to achieve our commitment to protect thesafety and health of our employees, HTC has established the exclusively responsible unit for environmental
issues and the occupational safety dept. (OSH Dept.) in accordance with the law, and are responsible for the
implementation of the entire safety, health and energy management system. It also assists the various factories
in continuing to promote occupational safety and health management and environmental management
systems and promotes environmental protection in an all-around way, the fundamental work of safety andhealth management and pollution prevention.
Every year, we also formulate an occupational safety and health management plan based on the state of safety
and health management. The implementation focuses include: compliance with safety and health regulations;hazard identification to reduce risks; standardization of hazardous chemical labeling and general rules;
the promotion of occupational safety and health information; and the establishment of a system to manage
contractors. All these measures are aimed at reducing risks.
We have emergency response plans that will be implemented in the event of an emergency caused by humanerror or natural disasters, such as fire, explosion, typhoon, an accidental leak, mechanical injury, infectious
disease, or an earthquake. As identification of the nature of the emergency, taking the necessary measures andexamination of standard operating procedures. We hold fire all measures impact on the health and safety of theworkers and also try to least damage or company property.
HTC has introduced the ISO 14001 Environment Management System and verified by third-party authorities.
To implement and be in accordance with environmental policy, relevant targets are set up and the systematic
measure of environment management in the daily management.

HTC Environment Protection,
Occupational Safety, Health, and Energy Policy

HTC smart mobile devices help reduce the transportation and travel previously needed forcommunication, and consequently the carbon footprint of the user as well. New combinations and new
patterns of operation, livelihood, work, study, and travel involving smart mobile devices help users saveenergy and reduce carbon emission.
To this end, we have devised a dual-aspect strategy composed of “adopting an energy management
system” and “performing energy-saving practice.” On one hand, we strive for optimizing our management
system to reduce energy consumption, and on the other, we use energy-saving technology to improve theenergy efficiency of our products.

A quick look at HTC management of energy and climate change

HTC strives to provide a safe and healthy working atmosphere for all of our employees while adhering
to sustainability best practices which protect our environment. HTC follows the guidelines below toachieve sustainable development and to ensure a better quality working environment for our employees,
customers, suppliers, and contractors.

As a response to the issue of greenhouse gases and global warming, HTC implemented the ISO
14064-1 Greenhouse Gases Emissions Inventory Program and has an ISO 14064-1 Greenhouse Gases
Emissions Verification Opinion Statement for the planning of energy strategy and action.

1. We regard environment, safety, health, productivity, quality, and effective energy management withequal importance.

All the HTC plants have been included in the Taiwan organizational boundary area and have been
subject to inspection since 2009.

2. We regard the safety and health of employees, customers, suppliers, and contractors with equal
importance.
3. We require our employees to observe all guideline regarding safety, operating procedures,
environmental protection, hygiene, health and energy management.
4. We are committed to preventing foreseeable dangers and loss control.
5. We follow required laws and regulations.
6. We are committed to give priority to the purchase of green products.
7. We will continue to practice and improve on our environment, safety, health and energy management
systems.

073

Sustainable Agenda

Between 2010 and 2015, the HTC plants in China were also included in the scope of inspection
and disclosure and external verification was launched. Electric power was found to be the main
source of emission.
The ISO 50001 Energy Management System, based on ISO 14064-1 standards, is used to check thegreenhouse gas emissions and emissions source of a company. With the help of energy management
systems, the ISO 50001 can achieve energy management according to plan. HTC has implemented
the system since 2011 in an effort to reach the goal of sustainable management.
After joining the Carbon Disclosure Project (CDP), HTC is obliged to regularly report its plans,
systems, and achievements regarding carbon risk and carbon management. Participate in CDP
Supply Chain program members and invite suppliers to participate in the carbon disclosure.

HTC 2019 CSR Report 074

Sustainability Management Vision

GHG Emission and Reduction

HTC will reach their short-, medium-, and long-term goals of sustainable development by the performance,
management mechanism promotion and system establishment, as well as by cooperation with society andother enterprises in environmental protection.

Total greenhouse gas emission by HTC was 14,812.288 t-CO2e in 2019. 2013 continues to be the base year,
and the greenhouse gases inventory in 2019 didn’t exceed over 3% of significance threshold. The majorityof emitted gas was CO2. It is notable that HTC’s GHG emissions contained little percentage of CH4, N2O and
HFCs. PFCs, SF6 and NF3 emissions were maintained at zero.

Green Management Vision and Mid-term and Long-term Planning

Besides, we have extended greenhouse gas emission investigation and external verification scope 3 to include
control over subsidiaries, including comprehensive statistics, and the monitoring of greenhouse gas emissions
to improve the overall energy use efficiency and create better energy revenue since 2014. HTC’s emissions
contained no Sulfur oxides or other waste gases, and HTC does not use any substances that might endanger
the ozonosphere. Moreover, the cooling and air-conditioning systems in HTC’s buildings all use environmentfriendly coolant R-134a to further preserve the ozonosphere.

2012-20152016-20202014 Taoyuan TY5 LEEDAwards—Gold Award
2014 Enterprise
Environmental Protection
Awards—Silver Award
2014 Taoyuan Energy
Conservation and Carbon
Reduction Action Label2015 Taiwan Corporate
Sustainability Awards
2015 UL Environment
Certificate—PlatinumAward2015 Helped safety andhealth program members
pass ISO 14001-related
verification

2021-2025

2016 Applied for clean production2016 Cooperated with government
agencies or schools to promote
environmental protection2016 Continued helping safety andhealth program members obtain ISO
14001-related verification
2016 Continued participation inEnterprise Environmental Protection
Awards

To create low-carbon
living circles throughcorporate environmental
protection concepts
based on HTC experience
To help contractors
obtain energy
conservation and carbon
reduction action labels

2016 Received Customer Sustainable
Development Award
2017 To apply for Energy Conservation
and Carbon Reduction Action Label2018 To receive Water Footprint ThirdParty Verification2018 the HQ & Plants solar photovoltaic
power generation system

2021
l
2025

Reduce power consumption (carbon emissions) by 5-8%.

HTC GHG Emissions
Total Emission

Unit

2017

2018

2019

Total Emission Scope 1

t-CO2e3,409.3880

2,711.7527

552.461

Total Emission Scope 2

t-CO2e29,972.2841

21,027.7191

12,601.900

Eco-Efficiency Value

NT$

1.78

1.00

0.76

Total Emission Scope 3

t-CO2e1,425.3491

699.0291

1,657.927

Emission:CO2

t-CO2e30,636.6878

21,421.7374

14,417.127

Emission:CH4

t-CO2e882.4375

494.8250

353.032

Emission:N20

t-CO2e1.25160.6854

0.186

Emission:HFCs

t-CO2e1,861.2952

1,822.2240

41.943Emission coefficients

1. Power Conversion CO2 equivalent emissions are calculated in accordance withthe power emission coefficient of the year announced by the Bureau of Energy
2. GHG Emission Coefficient Table, version 6.0.4
3. The scope includes HTC Headquarters & Plant, Taipei Offices and Tainan
Software R&D Center

Global Warming Potential(GWP value)

2017-2019 based on IPCC 2014 5th Assessment Report.

Water recycling rate reaches 75%.
Waste recycling rate reaches 80%.

2016
l
2020
2012
l
2015

075

Reduce electricity consumption (carbon emissions) by 5%.
Water recycling rate reaches 70%.

Note : Eco-efficiency value (revenue generated from each unit of greenhouse gas emission) = Operating revenue (in millions) / greenhouse gas emission (Scope 1+Scope 2).

Waste recycling rate reaches 72%.
Scope 3

Unit

Shuttle Bus

Reduce paper consumption by 3%.
Waste recycling rate reaches 70%

Reduce power consumption (carbon emissions) by 1.5%
Water recycling rate reaches 70%.

Sustainable Agenda

2017

2018

2019

t-CO2e212.630

170.486

149.197

Rubbish Truck

t-CO2e30.70350.87320.932Business Travelt-CO2e1,182.016

477.670

1,487.798

HTC 2019 CSR Report 076

Energy Saving and Carbon Reduction Results in 2019
HQ & Plants

Program

Energy Consumption Analysis

The exterior wall mercury street lamps
replaced by LED lights in TY3 building

3,888

3,888

11,664

2,072

2,072 100%

Air conditioning energy saving in TY3- 2F Building

3,391

3,391

10,173

1,807

1,807 100%

Lighting change from T8 to LED
in TY3- 2F, 3F, 4F back Building

28,51228,51285,53615,197

15,197 100%

IT computer facility air conditioning energy savingin H- 6F Building

4,296

4,296

12,8882,290

2,290 100%

Exhaust System update of toilet in H- B2F Building

528

528

1,584

281

281 100%

Exhaust System energy saving of male toilet
in TY3-1F Building

92

92

276

49

49 100%Total Use of Electricity (GJ)

Exhaust System energy saving of female toilet
in TY3-1F Building

92

92

276

49

49 100%TY3 Building

34,404

C stairs air handlind unit energy saving in H-1F

13,575

13,57540,7257,235

7,235 100%

H Building

18,276

B stairs air handlind unit energy saving in H-1F

33,97733,977

101,931

18,11018,110 100%

Lighting change from PL to LED of meeting room in H-6F

5,040

5,040

15,1202,686

2,686 100%

Lamps change from T8 to LED
in TY3- 4F&5F Front Building

158,717

158,717476,151

84,596

84,596 100%Wharf mercury lamps
replaced by LED cast energy-saving lamps in TY3

3,024

3,024

9,072

1,612

1,612 100%

534

Lighting change from T8 to LED in H-B1F & 7F Building

28,22428,224

84,672

15,043

15,043 100%

85,116

Lighting change from T8 to LED in H-7F Building

61,53861,538

184,61432,80032,800 100%

Energy saving solution of FFU fan in maintenance room
in TY3 building

4,095

4,095

12,2852,183

2,183 100%

C stairs air handling unit energy-saving solution in H-2F

6,129

6,129

18,387

3,267

3,267 100%

A stairs Fan Coil Unit energy-saving solution of toilet in H-1F

264

264

792

141

141 100%

Lobby Fan Coil Unit energy-saving solution in H-1F

2,916

2,916

8,748

1,554

1,554 100%

432

432

1,296

230

230 100%

The power used by HTC is mainly electricity. To decrease the use of electricity, we persistently promotevarious kinds of energy efficiency management. We achieve energy savings through the improvement of thelighting and air conditioning systems, and the installation of renewable energy equipment. In2019, the designon energy efficiency contributed to 419,895kWh (1,512 GJ) of reduction, and the total amount of reduction incarbon emission was 224 ton of CO2e which translates into a saving of NT$1,259,685.
Energy Saving and Carbon Reduction Results ofOffice buildings and Plants
2019

HQ & Plants

Carbon Emission
Energy Savings Amount
Reduction Saving
in kWh of Money
Saved in in Kg-CO2e/kWhRate
NT$ Projected Actual
Projected Actual

Xinghua 18

2,523

Taipei office 1

23,999Taipei office 2

5,380

Tainan Software R&D Center
Total

The Eco-efficiency Value of HTC
Environmental Indicators

Unit

2017

2018

2019

Electricity

1,000 kWh/Year

56,65837,95623,495

Operating revenue

Million(NT$)

62,12023,741

10,015

A stairs Fan Coil Unit
Power consumption and energy saving in H-1F

Eco-efficiency value

NT$

1.11

0.63

0.43

Exhaust System energy saving of male toilet
in TY3-5F Building

537

537

1,611

286

286 100%

Exhaust System energy saving of female toilet
in TY3-5F Building

537

537

1,611

286

286 100%

2,880

2,880

8,640

1,535

1,535 100%

Note: 1. The eco-efficiency value (revenue generated from each electricity consumption unit) = Operating revenue (millions) / electricity consumption.
2. The scope of electricity usage in 2019 is the HQ & Plants and Taipei Offices.

TargetEnergy-saving and carbon reduction Actions
HTC introduced an energy management system as per ISO 50001 to
gain a full picture of internal energy use. The applicable regulatory
requirements and energy benchmarks were implemented and HTC
set energy performance indicators, and short-, middle-, and longterm improvement goals. And gradually develop and implement
energy-saving action plans with the target of “conserving electricity
and reducing carbon emissions” was set up to eliminate the waste ofenergy caused by bad habits or incorrect information.

077

Sustainable Agenda

Conserving
Electricity
Reducing
carbon emissions

Achievement Rate

1%

100%

Lighting change from T8 to LED of toilet in TY3 Building

Taipei Office 1
Infrared switch added to safety ladder lighting

13,245

13,24539,7357,060

7,060 100%

Separate air conditioners in elevator machine room
are replaced by VRV in B Building

43,966 43,966

131,898

23,43423,434 100%

Total

419,895 419,895 1,259,685

223,804 223,804 100%

Note : 1. The money saved through energy conservation is calculated on a basis of the industrial electricity price announced by the Taiwan Power Company in 2019: NT$3/kWh.
2. The CO2 carbon emission coefficient is calculated on a basis of the 0.533 kg/kWh standard announced by the Bureau of Energy.
3. The effects achieved through the replacement or removal of lamps are figured out through power conversion.
4. The effects achieved by switching off lights at night and in the holidays is calculated through power conversion.
5. The effects achieved by reducing power consumed by water fountains are calculated through time control and power conversion.
6. The effects achieved through controlling air conditioning system temperature is calculated on the basis of saving ration and power conversion standard announced by the
Bureau of Energy.
7. The effects achieved through process optimization and two plants merged is calculated on a base of the actual used amount in the same period of 2013.

HTC 2019 CSR Report 078

Since large manufacturing centers are where the employees and the equipment consume energy most, we
focus our energy-saving efforts on the energy management of the large manufacturing centers, and carry out
different energy-saving strategies and measures according to the individual states of our respective facilities.
Targeting the HQ & Plants area, HTC plans to build a new energy management system. Through theadditional monitoring system, the energy-consuming equipment inside buildings can be monitored. Throughmonitoring, control, management, analysis, and other steps, an insight is gained into equipment operations
and energy consumption situations. Then, based on the judgment made through the comparative analysisof the monitoring system big data, continuous energy conservation improvement can be made. In addition,according to the equipment deployment and operation time during factory working hours and off-workhours, the equipment is turned on and off according to the automatic scheduling. This project was completedin August 2019, and energy-consuming equipment was included in the centralized management of themonitoring system to achieve the goal of continuous energy saving.

The Use of Green Energy
To create a low carbon life, we use only green energy, which includes the use of solar panels, eco-cooler air
conditioners, and other low carbon emission sources like electric cars.
Energy-saving program

Descriptions
1. Taipei Office 1 has solar panels that generate electricity used for lighting thestaircases and basement in 2012. The cumulative total number of solar panels
since it was built has reached 102,313 kWh, including 13,806 kWh in 2017, 13,918
kWh in 2018 and 11,418 kWh in 2019.

Solar panels

2. HQ & Plants has installed solar panels on the rooftop of Hsinhua Dormitory for
the water heating system. Heat generated in this way can be stored in tanks toprovide hot water for washing facilities, which reduces the use of natural gas andcarbon emission. The solar-powered equipment that HTC uses saved 19,274 cubic
meters of natural gas in 2019, this translates into an equivalent of NT$250,556
cost saving and a reduction of 37 t-CO2e.
Note: 1. One cubic meter of natural gas costs NT$13.
2. The carbon emission coefficients of natural gas is calculated in accordance with Version 6.0.4 of the Greenhouse Gases Emissions
Management Chart (1.888 kg-CO2e/M3).

Real-time information
monitoring system

ACsystemAir supply
andexhaustSingle line
diagramPower
resources
Ice water
systemMeter
overview

Cooling
water system

Details

Small fans

UPS

Air conditioning
boxes

Electricity
reportLighting
systemTwo-wire
control

Water
resources

Exhaust gas

Gas system

PublicsystemHeat pumps
for air conditioning

Taipei office are equipped with cold air heat pump systems for shower water forthe employees and other uses. The design concept is to absorb heat from theatmosphere or water and store it in water through a heat exchanger. The water,
after absorbing the heat, raises the temperature of a hot water tank to provide agreat amount of highly efficient and low-cost hot water. The air released during theprocess becomes the dry cool wind of an air conditioner. The system can generate
hot water, cool air, and cold water at the same time.

Electric vehicles
and bicycles

Taipei office has installed an ample number of power-charging sockets for electricvehicles and bicycles to encourage employees to use low pollution and high-energy
efficient means of transport.

Air pressure
systemNetworksystemEnergyanalysis
Generator

Tap water

Parameter
setting

SewageHot spot
analysis

AlarmsystemReal-time
alert
Alarm record
Power charging sockets forelectric vehicles

Boiling watercollecting

Building
H079

Sustainable Agenda

Building
P

Building
TY3

Free bicycles for rides

Solar panels at Taipei headquarters

Infrared switch of safety ladderlighting

HTC 2019 CSR Report 080

Setup of Renewable Energy Devices
Targeting the construction of a new parking shed in the
Headquarter, HTC used its roof to build a solar power
generation system, replacing the metal roof of the parking
shed with solar panels, a total generating capacity of 180KW.
By means of internal line parallel series, the power was soldin bulk and included in Taiwan Power Company’s power
supply system, thereby relieving Taiwan’s power load andsupply constraints and reducing carbon dioxide emissions.
This project was completed in September 2018 and put
into parallel trial operation, and started electrical energy
in in bulk. From the trial operation to January 2020, thecumulative total power generation has reached 198,760 kWh.

Resource Consumption Statistics in 2019

Solar Power Generation System

180kW Solar Power Generation System
Parking
shed 130kW

solar power
array

Inverter1

Sunlight / thermometer

R5485

Parking
shed 230kW

solar power
array

Inverter2
R5485

Parking
shed 330kW

solar power
array

30kW

solar power
array

30kW

solar powerarray

Parking
shed 6

solar power
array

R5485

degree/year

WastewaterRiver

Total city water discharge

Metric Tons

The amount of rainwater recycled

Metric Tons/year

1,654

Total amount of water recycled/reused

Metric Tons/year

27,913

The ratio of water recycled/reused to total amountof water consumed%/year

13.09

Total amount of waste recycled

Kg/year958,273

Total amount of waste reused

Kg/year0

Total amount of waste incinerated

Kg/year170,510

Waste disposal expense

NT$ thousand /year

1,414,308

Environmental management and recycling amount

NT$ thousand /year

3,061,345

213,237
Taipei Office- City dedicated sewer
HQ & Plants- Dongmen Creek
104,259

Note : 1. Since the consumption of Tainan Software R&D Centers is not significant, it is not included in the calculation
2. In 2018, since the P Building in HQ & Plants was rented, the amount of rainwater recovered was zero. Therefore, the overall amount of rainwater recovery was reduced.
3. Domestic garbage at Taipei Office consists partly of recycled cartons that are unquantifiable. A recycling company has been commissioned for handling.
4. Waste materials, as put into statistical data, are divided into categories ranging from plastic, paper, scrap iron, scrap aluminum, scrap galvanized iron, waste edge board, scrap
computer products, waste wood (pallets), miscellaneous types of plastic, scrap parts, disused desktop computers, disused screens, disused laptops ,kitchen refuse, recycled
domestic material and general rubbish.

AC boxWholesale
electric
meter

PM5350multimeter

Inverter5
R5485

30kW

City water consumption

Inverter4
R5485

Parking
shed 5

Unit

Inverter3
R5485

Parking
shed 4

Taipower system

2019

Environmental Indicator

R5485

Inverter6

R5485
Real-time solar information
monitoring system081

Sustainable Agenda

HTC 2019 CSR Report 082

Green Plant
The factories and offices disclosed in the boundary organization report this year
have been established in industrial and commercial areas after environmental
consideration and evaluation. The relevant environmental protection has been
implemented in compliance with local regulations and internal environmental policies
and specifications that have no significant impact on the local ecosystem and animaland plant species.
However, we still encourage all our plants and offices to go on with their efforts tobeautify the environment. As for the new buildings, we aim to improve the employee
working environment through the introduction of green building design.

An Office Environment with Plants and Green Landscaping
We uphold the concept of environmental sustainability and we regularly increase our green space in HQ & Plants
and Taipei Office. The HTC outdoors green area now totals 30,700 m2 and the Taipei Office building horticulture
planning adhered to the concept of environmental protection and open parks. The planting area on the first floor
reached 41% of the total base area. According to the topographic planning, large trees totaling 260 were planted,
including camphor trees, Liquidambar, Podocarpus, Taxodium distichum, and cherry trees. Additionally, the plan
designated eight shrub planting areas and one ecological pool area to plant about 3,200 plants. In HQ & Plants
area, there are around 131 tree species native to Taiwan on the grounds, such as Camphor and the Taiwan Goldenrain Tree. Our employees can enjoy the lush green surroundings of their work environment.
Taipei Office planning covers B1 to 17F. In every floor, the indoor foliage was widely planted, totaling 450 pots.
Different plants added for different festive holidays in order to enhance different festive atmospheres. In
addition, we also planted beautiful green plants, such as the round pepper, the tiger-tail orchid, the lime pothos,
the philodendron, etc., in the lobby of H Building and TY3 Building in Taoyuan. The 2019 annual management
fees for our green environment maintenance amounts to NT$ 2.15 million which is used to provide a fresh andgreen office environment for HTC employees.

HTC’s Taipei Headquarters, The Golden LEED Certified Green Building
In 2013, HTC’s Taipei office received the green building mark from Ministryof the Interior and the golden LEED (Leadership in Energy & Environmental
Design) certification from the U.S. Green Building Council (USGBC), offering its
employees an excellent and comfortable low-carbon and take the responsibilityof environmental sustainability. The fully-integrated energy management system
was utilized to attain a full real-time management and enhance the efficiency ofenergy use. The total amount cumulated for the reduction in carbon emission
since the inauguration of the building has reached 14,372 t- CO2e.
The fully-integrated energy management system is constructed in the Taipei
Office, which covers over 7,000 spots of on-site monitoring, total monitored spots
amounted to 20,000. Under the effective control and analysis, the EUI (Energy
Usage Intensity) of Taipei offices amounted to only 114 kWh/m2 annually in 2019,
which was quite a marvelous result.

LEED gold certification

Unit: EUI (per year)

Building

HTC Cherry Tree Garden
To allow people passing by to see some common plants, HTC has planted themost popular cherry trees in recent years. In addition to providing a beautiful
view at the beginning of the year, cherry blossoms can also feed butterflies.
Whether the flying butterflies nearby the cherry trees, or caterpillars that attract
birds for foraging, they have increased the richness of ecosystem around HTC.
HTC’s cherry tree garden is located on the right side of the Taipei Office 1
Building. There are 5 Yae Sakura near Zhongxing Road, and 8 Yoshino Sakura
and 5 maple trees near the ecological pool at the back. Rock slabs are laid on thegrass. When the blossom season arrives, visitors can walk on the cherry blossom
trail to enjoy the breath of spring.

083

Sustainable Agenda

Year

2017

2018

Taipei office 1

93.98

102.91

114

Taipei office 2

223.14170

172

HQ & Plants(P, H, TY3)

262.53187.06

97.20

2019

Green Building Label

Green Procurement
Our strategy is to buy environmentally friendly products to substantiate our environmental protection concept of“recyclable, low pollution, and resource-saving”. We express the purchase of environmentally friendly products
as a priority in our procurement specifications to firmly integrate the concept into our daily operations.
In 2019, the amount of green procurement reached NT$ 3.71 million. From 2012 to 2019, the accumulated
expenditure for products with green-product stamp was about NT$ 30.80 million.

HTC 2019 CSR Report 084

Water Resource Management

Sewage Treatment

The water source at the HTC facilities is tap water. The production line processes at our facilities do not use
any water, so there is no industrial wastewater generated. The wastewater generated by our facilities is mainly
domestic sewage from the washroom and for other cleaning uses and restaurant wastewater that contains
no process wastewater. Domestic wastewater is discharged into the sewage system, which will not have thenegative impact on any neighboring water body.
Office/Facility Water Use and Water
Plant

Usage in 2019(Metric Tons)

HQ & Plants

Taipei offices

We invested NT$ 27,760,000 in building sewage treatment equipment in 2010 and spent NT$ 1,628,748 on
operation and maintenance in 2019.

Description of Sewage Treatment Unit Facilities

Water Saving Measures

139,983

Reached 46.56% recovery rate

73,254The Taipei building selected water-saving water equipment,using air conditioning condensate and recovered rainwater. The
overall daily water-saving rate was 66% (including toilets, urinals,
faucets and showerheads).

Domestic
SewageFine sieve pumpUnit: ton

Fine sievemachineSewageadjustment tank

Fine sieve after
degreasing

Upper liquid
refluxOil slicktreatment slot

Surfacedegreaser

Aeration tank
Scum
Greaseintercepting tank

Quick mixing
tank
Slow mixing
tank
Sedimentation
tank
Recyclestorage slot

Activatedcarbon filter

SludgePump

Sludgestorage tank

EntrustedcleanupMid slot

Discharge slot

Watering
Discharge

SludgeSludge belt
filterSludgeEntrustedcleanup085

Sustainable Agenda

HTC 2019 CSR Report 086

To substantiate sewage control, we have implemented daily maintenance and inspection in accordancewith the “Procedures for Sewage System Operation, Repair, and Maintenance.” We abide by all the laws andregulations and the sewage is tested every six months by an institution authorized by the Environmental
Protection Administration. The final test results are published on the Internet and show that the effluent andrecycled water are in full compliance with all the standards.

Rainwater Storage and Recycling System
HTC has established a rainwater storage and recycling system to collect rainwater for flushing toilets andwatering plants. A total of 1,896 metric tons of rainwater was recycled from the Taipei office Building,effectively saving water resources.

Domestic sewage is discharged into the sewage sewer. Based on the average concentration of effluent BOD and
COD from 2016 to 2019, there will be no adverse effects on the nearby water bodies. Since 2017, a self-initiatedtest of effluent heavy metals has shown ND or lower than the test value. Starting January 2013, the average
daily treatment capacity of the sewage treatment plant reached 600 metric tons, sufficient to replace the use of
tap water for park landscape irrigation and for toilet water use.
The Amount of Water Discharge and Recycled Water, and the Average Concentration of BOD
Average
The Suspended Test of Effluent
Concentration
Solids(mg/l)
Heavy Metals
of COD(mg/l)

YearAmount of
Water Discharge(Metric Tons)

Amount of
Recycled Water(Metric Tons)

Average
Concentrationof BOD(mg/l)

2017

63,988

182,002

16.6

50.85

22.35

N.D.

2018

108,459

53,593

7.15

32.2

12.7

N.D.

2019

46,903

26,259

3.38

10.55

<2.5

N.D.

Note : 1. Tested items of heavy metals: Cd. Cr. Cr+6. Cu. Zn. Ni.
2. In 2018, due to the large reduction in the area of vegetation that needs to be watered, the amount of recovered water decreased and the amount of discharged water increased.
3. The scope of statistical data is HQ & Plants

Sewage Recycling

Rainwater monitoring system

The domestic wastewater is discharged into the sewer system and delivered to the wastewater treatment plant.
The treated wastewater is discharged into the Dongmen River, which eventually flows into the Nankan River.
In 2019, the total domestic wastewater treatment volume was 4,196 metric tons, and the recovered volume
from the treatment of domestic wastewater was 1,865 metric tons.
The green fields and planted areas inside the factories are irrigated with recycled sewage water without
increasing the total amount of water consumed. Starting from 2012, HTC drafted and implemented water
conservation plans. We examine results
each year to examine whether or not
Effectiveness of domestic sewage recycling in 2019to adjust the goals. From 2014 to 2019,the amount of recycled water used for
Strategy and EffectivenessSewage Recycling
irrigation was 938,235 metric tons. It’s
Sewage water output (Metric Tons)
73,162bout 375 standard swimming pools (eachRecycled
waterfor
irrigation(Metric
Tons)
26,259standard swimming pool is calculated at2,500 tons)
Amount saved (NT$)
341,367
Actual wastewater recycling rate

087

Sustainable Agenda

Water-saving Sanitation Equipment
HTC gives top priority to the use of sanitary equipment with a water-saving label.
The faucet device installed with water-saving spiral allows the faucet to reduce theamount of water outflow and each faucet can save 77 liters of water a day. More than
11,434,500 liters of water have been saved since installation in October 2012. All the
toilets and urinals in the bathrooms should be energy efficient and have the Water
Sense Label of the United States Environmental Protection Agency and Water
Label of water resource agency, MOEA.
Note: For a total of 500 faucets have been installed and each faucet can save 231 liters of water per month. Since the installation, it has been
99 months up to the end of 2019. Therefore, it is calculated as: 99 months × 231 liters × 500 = 11,434,500 liters.

45.56

HTC 2019 CSR Report 088

Environmental Protection Education and Promotion

Photocopying Paper Management
HTC aims to reduce photocopying paper consumption by 1% per year and bring the use of paper down to an
absolute minimum.
By the end of 2019, the total number of paper saved was 982,500 sheets, achieving the best paper saving
management. Compared with 2018, NT$ 127,005 was saved, which is equivalent to a saving rate of 45.39%.

Print

Use photocopying papers with carbon footprint labels to support green, low-carbon products
Link the computer with the employee number, the employee card must be sensed in front of thebusiness machine before printing, effectively reduces the unclaimed printed documents

Fax

Unified management in the entire factory area, select fax function to send faxes with the employee's
computer to eliminate the paper waste with paper fax in the past

ScreenDocuments can be scanned after the employee card is sensed and reply to the employee's email
immediately after the scan is completed

HTC continues to promote and enhance environmental protection consciousness and awarenessin employees using a diversified interface. Through the new employee educational training andthe provided training materials, the idea of environmental protection is promoted within theorganization. Moreover, corporate policy posters are displayed on important bulletin boards todeliver continuously the information on environmental sustainability, allowing employees to feel
HTC’s efforts in environmental protection and give their full support through actions as well as
everyday life habits.

HTC Paper-Saving Performance
Year

2017

2018

2019

Paper Use (Piece)

5,027,500

2,010,000

1,027,500

Paper saving (Piece)

75,0003,017,500

982,500

Paper saving target

1%

1%

1%

Achievement rate

1%

60%

48.88%

12,125

340,460

127,005

Amount saved (NT$)

Picture Environmental Policy Poster

Environmental Protection and Safety and Health Education
New employees and on-the-job staff education training

Note: In response to the company’s boundary merging and department downsizing, the paper-saving rate in 2018 has increased significantly.

Course089

Sustainable Agenda

2017
2018
2019
Responsible
Unit Person Total Person Total Person Total
hours
hours
hours

Hour

Frequency

Environmental protection
and safety and healtheducation training

3

On board

OSH Dept.

1,813 5,439

1,499 4,497

00Hazardous substance use

3

On board

OSH Dept.

1,813 5,439

1,499 4,497

00Operational equipment
hazard notifications

3

After arriving at
the departmentof work

Equipment
Dept.

54

162

General labor safety andhealth in-service
education training

1

Annual(On-job training)

On-Site4,724 4,724

3,601 3,601

Hazardous chemical
use notice1

Annual(On-job training)

On-Site1,265 1,265

1,538 1,538

779

Prevent illegal violationsof duties

0.5

Annual(On-job training)

On-Site

-

-

1,978

989

1,583 791.5

Environmental education

1

Annual(On-job training)

On-Site6,986 6,986

-

-

93

279

89

267

1,694 1,694

-

779

-

HTC 2019 CSR Report 090

Sustainable Design
Encourage Employees to Carpool
HTC runs a shuttle bus service on many commuting
routes with a daily capacity of 319 passengers. Thistransportation arrangement together with carpooling makes it easy for employees to move toand from work. By cutting down on the number ofvehicles travelling to and from the plant the amountof greenhouse gas emitted, in the form of vehicle
exhaust, can be significantly reduced.

2018

2019

308,525km

294,523km

Shuttle bus
total gas
consumption

51,421L

49,087L

Total carbon
emissionvolume177,402.45
KgCO2e169,350.44
KgCO2eShuttle bus total
driving distance

Annual gasoline consumption and carbon emissions of shuttle buses in 2019
Bus

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Wenn-chin 26,355 14,430 24,050 24,050 26,455 22,848 27,728 25,288 22,743 25,253 25,253 25,253
Miles (km)Taoyuan Bus
total
Wenn-chin

440

240

400

400

440

Wenn-chin
Taoyuan Bus
total

460

420

380

420

420

420

26,795 14,670 24,450 24,450 26,895 23,228 28,188 25,708 23,123 25,673 25,673 25,673
4,393 2,405 4,008 4,008 4,409 3,808

4,621

63

77

Oil
consumption Taoyuan Bus
73
40
67
67
73
(liters)
total
4,466 2,445 4,075 4,075 4,483
Carbonemissions(KgCO2e)380

4,215 3,790 4,209 4,209 4,209
70

63

70

70

70

3,871 4,698 4,285 3,854 4,279 4,279 4,279

HTC starts from the product life cycle, analyzes the product process in detail, and adopts different measures atvarious stages through innovative thinking, especially in the product design and development stage, it uses theconcept of The Precautionary Principle to carefully select the ones with lower environmental risks. The material
confirms that it complies with the internationally Restriction of Hazardous Substances Directive, reduces theenvironmental impact of products, and develops sustainable products that are more environmentally friendly.

15,154 8,297 13,829 13,829 15,212 13,137 15,943 14,540 13,077 14,520 14,520 14,520
253

138

230

230

253

219

265

242

219

242

242

242

Green Marks Obtained by HTC

15,407 8,435 14,059 14,059 15,465 13,356 16,208 14,782 13,295 14,762 14,762 14,762

Note : 1. Kilometers per month=kilometers per ride* total rides per month.
2. Fuel consumption calculated as 6km per liter (km per month/6km).
3. Carbon emissions per km calculated using the coefficient of diesel fuel of 3.45 L/Kg CO2e (mobile source) according to “information disclosure on the carbon footprint
calculation service platform”.
4. Round-trip distance from Taipei to HQ & Plants is 35km/trip and HQ & Plants to Taoyuan Train Station is 2.5km/trip.

Green Mark

Description

Applicable Area

Verified by a third-party verification company (UL)
as meeting North American (US and Canada) energy
efficiency requirements.

Power supply units

Verified by a third-party verification company, throughthe US Department of Energy (DOE) and the Canadian
Department of Natural Resources (NRCan), the energy
consumption requirements for battery products

Mobile phones, virtual
reality(VR) device, including

Accessories with rechargeable batteries, etc.

Batteries

We work diligently to reduce the use of environmentally harmful substances, to increase recyclability, improve
the reuse of resources, and reduce the adverse effects our products have on the environment. HTC’s sustainable
design concept is reflected in three areas including: increased energy efficiency, recyclability and reducing
hazardous substances with the serious intention of making our products really green and competitive.

091

Sustainable Agenda

HTC 2019 CSR Report 092

Enhancement of Energy Efficiency

Energy efficiency regulations for battery charging products by the US
Department of Energy(DOE) and Natural Resources Canada(NRCan).

We concentrate on energy saving from the early design and research and development
phase. All power supply devices used for HTC products must comply with the relevantinternational energy consumption specifications: Energy Star (U.S.), California Energy
Commission (U.S.), Energy-related Products and are approved with energy efficiency
verification by third-party verification companies, and the energy efficiency has reachedthe highest level of Level VI requirements, of which the Level VI standard requires
standby power of less than 0.1W, and the currently used chargers are lower than 0.075W
or 0.03W, which has greatly exceeded the standard requirements.
Type
TC P5000

Product

Energy Efficiency

Standby energy consumption(115V)

Smartphone(U11, U11+, U12, U19e)

Level VI<= 0.03W

Level VI<= 0.03W

Level VI<= 0.075W

Level VI<= 0.03W

TC NE5W
TC NE18W

The US Department of Energy (DOE) issued the energy efficiency regulations for battery charging (BC)products in 2016, which was implemented in June 2018. All BC products sold in the US market mustcomply with the DOE regulations and be registered. Natural Resources Canada (NRCan) enforced thesame regulations in June 2019.

VR(VIVE, VIVE Pro, Cosmos)

TC NE30W

Prior to this, the California Energy Commission (CEC) began implementing energy efficiency
regulations for battery charging systems in February 2013. These requirements cover almost allelectronic products that use rechargeable batteries, including mobile phones and notebook computers.
Nevertheless, the DOE regulation focuses on the unit energy consumption (UEC), that is, the amount ofelectricity consumed during the charging process must not exceed the limit.

The HTC R&D team has developed excellent power management modes that allow the phone (depending onuser habit) to automatically enter Standby mode to extend battery life. Some of our phones have an ambient
light sensing function that controls the LCD backlight according to the ambient light level in order to provide a
comfortable reading environment and also to save power. For the energy consumption during battery charging,
we use the regulations of the US Department of Energy (DOE) and Natural Resources Canada (NRCan) as
standards to try our best to improve the efficiency of charging and reduce the loss of energy consumption when
the battery is fully charged to minimize the overall energy consumption.

Type

5G HubVIVE Focus

VIVE Mobile locator

Unit energy consumption(Represented value of UEC)

6.06

4.17

2.02

Regulatory limits

6.98

4.84

3.36

Unit

kWh/year

Note: The unit of energy consumption (Represented value of UEC) is tested and calculated according to the regulations of the US Department of Energy. It represents the additionalenergy consumption in addition to the power obtained by the battery during the charging process. The lower the number represents the charging process; there is Better power
conversion efficiency and lower standby power.

093

Sustainable Agenda

HTC 2019 CSR Report 094

Recyclability
We start a full evaluation of a product for recyclability at an early stage of the R&D process. To dothis we conduct a simulation of disassembly and analyze the material composition of the productand relative recycling rate. In addition, we carry out a series of strategies such as material marking(as per the standards of ISO 11469 and ISO 1043) and component simplification and degree of easeof disassembly. Then feedback is given to the R&D team about any useful and valuable strategies.
Currently, HTC product could meet the present and future requirements for recycling.
We consider material recyclability in the selection of all materials and product disassembly andanalysis is carried out by an impartial third-party. All current products such as 5G Hub、VIVE
Focus、VIVE Cosmos and VIVE Cosmos Controller. This significantly exceeds the EU WEEE
Directive on the mobile phone material recovery standard which is 55%.

5G HubVIVE Focus

Material recovery rate

Material recovery rate

82.0%

EU
WEEE
Standard

76.3%

Phone and Battery Recycling>ABS+PC<To properly fulfill their responsibilities as a manufacturer, HTC, which is 100% in line with EU WEEE
requirements, has also promoted the US and Canadian mobile phone recycling program. Old mobile
phones, up to a value of US$499.99, can be traded in to reduce the undue disposal or handling of old mobile
phones and the impact of this upon the environmen
1. HTC promotes cell phone trade-in program(http://www.htctradeup.com/), through online platform toallow the customer to receive the old cell phone recycling offer without limitations in cell phone brand,
and acceptable as long as the old cell phone is still operable. The check will be mailed to the customer
after the new cell phone is purchased and the old cell phone is mailed back. In 2019, the total cumulative
units of devices were 41 units with the value of US$ 615.

2. HTC also participates in the industrial management program Call2Recycle that is currently
implemented in the United States. The program provides for the collection and recycling of batteries,
including cell phone lithium-ion batteries, as well as the recycling of cell phones in Canada. We pay
a fee to Call2Recycle for every mobile sold in the United States and Canada. In 2019, the project
recycled 3.402 million kilograms of batteries and mobile phones in the United States and Canada,
among which more than 75,296 kilograms of disposable batteries were recycled in Vermont in
2019, an increase of 13% compared to 2018. Due to the gradual increase in customer awareness andrecyclability, more than 55.792 million batteries have been collected and recycled in the United Statessince the project was launched in 1994.

55%

095

VIVE Cosmos

VIVE Cosmos Controller

Material recovery rate

Material recovery rate

74.9%

75.3%

Sustainable Agenda

3. HTC takes part in the state-owned e-waste programs of more than 20 states in the US, responsible forrecycling Nexus-9 Tablet PC. Due to different recycle mechanism of life cycle termination determinedby each state, many states establish the weight of the Company’s annual recyclable electronic products
by market share, some states charge the cost to the manufacturer based on the price of unit weightof the recycled products, while the remaining states allow the mail recycle plan, and pay the annual
registration fee, without having to set the recycling target. For example, in Washington State, we pay acertain percentage of expenses according to the market share of the tablet PCs, the local governmentis responsible for the recycling collection operations across the entire state, and the recycle firms
legally registered with the state ecological department recycle the electronic products to ensure thatthe recycling operation is held responsibly and appropriately. From 2009 to 2019, there was a total of
186,685,749 kg of electronic waste recycled in the Washington state area.

HTC 2019 CSR Report 096

Positively Cutting Hazardous Substance
All parts, components, modules, materials, and so on delivered to HTC meet a set of requirements, which are evenstricter. The HTC Substance Control List not only restricts the ten substances controlled by RoHS(Restrictionof Hazardous Substances Directive), but also others restrained by international environmental regulations andcustomer requirements, such as polyvinylchloride (PVC), Brominated Flame Retardant.
To further extend the control of hazardous substances into the supply chain. The green supply chain management
platform was established in 2006, and R&D engineers can select green materials that meet international
environmental regulations and customer requirements in the product database, and import green materials fromthe source design to improve the reliability of green products and the relevant verification schedule.
In terms of material selection, in response to international trends, HTC introduced halogen-free materials in
2009. USB cable uses thermoplastic elastomer (TPE) instead of polyvinyl chloride (PVC). In terms of productdesign, the mobile phone plastic shell and PCB board are both using halogen-free materials, it was announced
in 2012 that the new smartphone meets the halogen-free requirements. In order to continue to be committed
to clean production and non-toxic products, non-electroplating processes have been used in the appearance of
products in the manufacturing process since 2011. The use of n-hexane was also banned in 2013. The productdesign will be used in mobile phones in 2015, the beryllium copper alloy at the connection point is replacedby other safer materials. Although the beryllium copper alloy itself is a material with good safety and goodcharacteristics, it may produce beryllium oxide that is harmful to the human body during waste recycling, so
we decided to replace it. From 2016, new products will no longer be used.
To prevent the harm of plasticizers to the human body, the European Union has officially implemented
the directive on restricting plasticizers for electronic motor products on July 21, 2019. HTC has launchedplasticizer control since 2009, and added a plasticizer control item to the hazardous substance control list.
In 2017, it began to conduct plasticizer testing and verification of all products to ensure compliance withregulatory requirements, and also required suppliers Obtain a third-party laboratory verification report.
Before the regulations are formally implemented, HTC Headquarters and the factory establish a plasticizer
inspection laboratory to conduct random sampling of incoming materials to ensure that all parts can meet theplasticizer regulations.

HTC Hazardous Substance Control schedule
2015
Beryllium copper alloy was replaced by other safer materials

2012
Declared that new smartphones meet halogen-free requirements

2009
1997

Banned the use of PVC USB cable, and introduced
halogen-free plastic housing and PCB board

HTC established2006
Established the green supply chain
management platform

2011

External parts were replaced byalternatives with non-plating process

2013

Banned the use of n-hexanein the process

2017

Started to strengthen
the control measures for plasticizer

TD-GC/MS is used to check plasticizer

097

Sustainable Agenda

HTC 2019 CSR Report 098

HTC plasticizer (Phthalate) control schedule

EU RoHS-Restriction of the Use of Hazardous Substances
April 2019
HTC head office and factory established aplasticizer inspection laboratory, and all incoming
materials are subject to random inspection

RoHS is the abbreviation of the Restriction of the use of certain Hazardous Substances in electrical andelectronic equipment. Currently, the major Directives include 2011/65/EU and EU 2015/863.

2017
Performed product verification to confirm the absence of plasticizer

RoHS restricts the use of four plasticizers

2009
Plasticizer was added
to the hazardous substance control list

1997

Abbreviation Name

The limit

The main application.

HTC established

DEHP

Bis (2-ethylhexyl) phthalate<1,000pm

Mainly used as the PVC plasticizer; PVC is used as an
insulator in electrical and electronic equipment suchas cables and wires. A small amount of DEHP is used
for other non-polymer applications, such as ceramics
for electronic products or electrolytes for capacitors.

BBP

Butyl benzyl phthalate<1,000pm

Mainly used in combination with other plasticizers in
PVC components such as cables, sockets, pipes, shock
absorbers, and used in some non-polymers such as
paints, adhesives, sealants and printing ink.

2015
EU RoHS published regulations to restrict
the use of 4 plasticizers (EU 2015/863)

2018

Scope of verification was extended to include supplier materials

July 2019
EU officially restrict the use of plasticizers forelectronic and electrical products

Citizen Group Initiative Taiwan Watch Institute PVC Cable Market Survey
In view of the fact that PVC (polyvinyl chloride) can cause damage to the environment and human bodyfrom its production, use and disposal, the Taiwan Watch Institute, a citizen group in Taiwan, plans
to expand their initiative by conducting a large market survey on individual household supplies andreleasing the results of the survey, utilizing the power of consumers to ban the use of PVC. In 2019, they
started to investigate the market survey of charging cables and earphone cables for small 3C (computer,communication, and consumer electronics) products. Among the 74 brands of charging cables tested,
85% of them contained halogen, suggesting that these materials are made of PVC. There were 42 brandsof earphone cables tested, and 29% of which contained PVC.

DBP

Dibutyl phthalate<1,000pm

It is mainly used as a plasticizer in PVC floors, andmay be present in synthetic leather, textile coatings,
PVC materials, printing inks, sealants and adhesives
for electrical and electronic equipment.

DIBP

Diisobutyl phthalate<1,000pm

Used as a plasticizer for PVC, as a substitute for DBP,
and as a plasticizer for cellulose resin, vinyl resin,
nitrile rubber and neoprene.

Active in Compliance with Standards
All HTC mobile phones are verified by international public certification companies. Chemical analysis is carriedout to ensure compliance with the EU environmental directives. HTC also cooperates with their customers
in green-related certification plans such as the ULE and ecological scoring systems and this ensures that all
products comply with customer green specification. Among the SAR regulations currently in force, FCC (US) andCE (EU) are the strictest, and all HTC products satisfy meet these requirements.

HTC introduced halogen-free materials in 2009 and replaced PVC with TPE (thermoplastic elastomer)
to protect the environment and the safety of consumers. For more information about the “Taiwan Watch
Institute,” please visit https://www.taiwanwatch.org.tw/node/1342

099

Social Investment and Contribution

HTC 2019 CSR Report100Sustainable Manufacturing Process
In 2019, HTC’s waste disposal methods consisted of four types:

Management of Waste and Hazardous Substances
The major manufacturing operation at HTC is the assembly of Smartphone and virtual reality device , so
the only waste is gas produced by welding, without NOx or SOx emission. We handle and dispose of waste
according to our self-regulated “Process for Removal and Handling Business Waste” and practice good
resources recycling to ensure cleanliness of the working environment and reduce environmental impact.

HTC Waste Statistics
Treatment

Regarding management measures, besides entrusting legal disposal authorities to properly dispose of the waste
in accordance with the government policy, we also follow disposal trucks to check and confirm their cleaning
status on site from time to time. Regarding plants, we inspect waste storage and temporary storage zones
through inspection checklist regularly, and request corrections for non-compliance within a limited time. We
also establish environmental safety and health self-assessment form and perform audits, to accomplish effective
management and evaluation mechanism. In the event of environmental concerns, HTC can be reached via theinformation on the company’s website to ensure that we respond and handle it promptly.
Measures

Methods

Set up recycling bins and commission manual
sorting of domestic waste.

Set up recycling bins and encourage and propagandize
staff to sort domestic waste. The employees recycled
170,510 kg of domestic waste in 2019.

Used batteries, light tubes and information
technology objects must be recycled.

We have recycling stations for used batteries and lighttubes available to the employees

In the process of mobile phone and virtual reality device assembly /manufacturing, HTC inevitably generates
general business waste and small amounts of harmful business waste. HTC upholds and implements proper
disposal of waste, commissioning legal waste removal and processing companies and choosing the best handlingapproach based on the nature of waste.
Year

2017

2018

2019

Waste weight of each unit manufacturing (kg/unit)

0.07850.7

0.44

Weights of each unit recycled (kg/unit)

0.4037

2.81

3.25

Note: In 2018, large amount of assets were scrapped due to internal organization change or merging. As a result, the average weight of recycled materials for each mobile phone in 2018
has increased significantly compared with that in 2017.

Unit

Treatment Capacity
2017

2018

2019

Descriptions

Recovery (General)kg

2,434,060

1,771,481

958,273

Including Tray plate, foam, miscellaneous
plastic, waste wood pallets , Computer
peripherals (host, screen, laptop, electronic
waste)

Incineration(General)kg

660,540

415,510

170,510

Domestic garbage

Burial: Waste bakelitekg

69,96023,5600Chemical treatment:
Harmful waste liquidcontaining copper

kg

0

0

No waste bakelite had been produced in 2019

1,785

The chemical treatment shall be conducted
once every two years for the treatment
according to "Methods and Facilities
Standards for the Storage, Clearance andDisposal of Industrial Waste”.

Chemical treatment:
Harmful waste liquid

kg

0

0

2,780

The chemical treatment shall be conducted
once every two years for the treatment
according to "Methods and Facilities
Standards for the Storage, Clearance andDisposal of Industrial Waste”.

Other: kitchen leftoverkg

324,078

179,997

146,343

The amount of leftover is calculated on abarrel of 189 kilograms.

Waste Reduction, Recycling and Reuse
HTC waste reduction strategy involves the reduction of the generation of waste from the sourceby means of sorting and advocacy. The reuse of waste is also a priority and is essential for an
increase in resource recycling efficiency.
We have been taking steps to handle the treatment of waste materials according to type. As an
example, we commission contractors to collect and recycle waste trays. In addition, a numberof other licensed contractors are employed to recycle other material and much of the waste ispurified and turned into industrial raw material. Other waste goes through physical classification
which increases reusability. For example, the source control strategy is adopted when therecyclable plates and sponges can be recycled to the production line for reuse. The material thatis not recyclable goes to a final destination. We also publish the condition of temporarily stored
waste material on the Internet. Our recycled resources reached 958,273 kg in 2019.
Between 2011 and 2019, the money earned or saved by recycling waste rose year by year to reach
NT$3,061,345 by 2019. The waste recycling rate increased from 56.89% in 2011 to 84.53% by 2019
to pass our long-term goal of 80%. By 2019 the accumulated savings and earnings from therecycling of waste had reached NT$88,852,523.

101

Sustainable Agenda

HTC 2019 CSR Report102Hazardous Substances and Chemical Control

HTC Hazardous Substance Management Policy

Waste Recycling Effect and Rate

100,000,000

100.00%90,000,000

90.00%

80,000,000

80.00%

70,000,000

70.00%

60,000,000

60.00%

50,000,000

50.00%

40,000,000

40.00%

30,000,000

30.00%

20,000,000

20.00%

10,000,000

10.00%

0

Cumulative
Amount of
Recycling inNT$
Recycling
Rate

2011

2012

2013

2014

2015

2016

2017

2018

6,466,984 18,403,308 31,109,190 41,863,673 54,950,036 61,788,676 66,983,184 70,874,331 88,852,523
56.89%

62.94%

65.82%

65.19%

70.72%

74.43%

78.09%

81.02%

Kg

Kg

4,000,000

20,000,000

3,500,000

18,000,000
16,000,000
14,000,000

2,500,000

12,000,000

2,000,000

10,000,000

1,500,000

8,000,000
6,000,000

1,000,000

4,000,000

500,000
02,000,000

2012

2013

2014

2015

2016

2017

2018

2019

Total Weight of
2,605,450 2,785,082 2,723,339 3,037,885 3,450,697 2,434,060 1,771,481
958,273
Waste Recycling
Cumulative Weight 2,605,450 5,390,532 8,113,871 11,151,756 14,602,453 17,036,513 18,807,994 19,766,267
of Wastes Recycling

Sustainable Agenda

0

The European Union published Directive (EU) 2015/863 on June 4, 2015, and included four plasticizers
phthalate- DEHP, BBP, DBP and DIBP in the list of restricted substances. The implementation date is
July 22, 2019. In response to the requirements of this directive (RoHS 2.0), HTC manufacturing units
have built a new device-Thermal Desorption MS to detect the newly added restricted substance list toensure that all incoming parts can be detected Restrict the substance content of the substance list, andoperate according to the mechanism of the hazardous substance process management system (IECQ
QC080000:2017)

HTC understands that in the green competition between corporations around the world, the active
management of harmful substances and chemicals is the only way to ensure the reliability of the
manufacturing process and product compliance with the standards of the different countries and customers.
In so doing, we reduce the legal risks that our products might suffer. We completely banned four chemical
substances, including n-hexane, n-heptane, benzene, and toluene. According to customer requirements,
international standards, and domestic regulations, we restricted the use of 527 chemical substances such as
hydrazine and dichlorobromomethane. Besides, we take the following measures to control the condition ofchemicals used during the manufacturing of components and parts. These include:

84.53%

3,000,000

103

00.00%

2019

HTC analyzes the international environmental protection regulations and complying with theenvironmental protection requirements of international customers, with reference to the relevantinternational technical standards, and then establishing the IP-00000106-01 Toxic Substance Control
List, and holding suppliers meeting regularly to work with parts suppliers together seeking for the useof non-toxic materials under the Company’s hazardous substance control policy with green supply
chain management, so that the procurement of raw materials, that is, using the principle of the source
management to conduct strict control of hazardous substances. In the product development stage,
the R&D department will deliver the relevant parts materials to the ISO 17025 qualified laboratories,
such as SGS, TUV, to ensure that the materials used in the product conform to the international
environmental protection specifications. In the aspect of production management, the manufacturing
department has also set up the hazardous substances testing standards to ensure that all products ofmass production are non-toxic non-hazardous green products.

1. Specially-assigned employees make an inventory of the chemicals in the plant on a regular basis. They also
have to inspect the chemicals and ascertain their condition. Including:• Use types, quantities and the storage status of the chemicals (includes storage container management)• Whether the chemical’s label of the using unit is complete• Whether the information about the chemicals is complete, such as the safety data sheet (SDS, Safety
Data Sheets)• Personnel are required to wear basic safety protective gears when using the chemicals
2. Compressed gas fire extinguishers should contain safe eco-friendly agents:
Replace CO2 fire extinguishers with safe halogen compound fire extinguishers.
3. Emergency lights should be powered by eco-friendly batteries:
Replace lead-acid batteries with nickel-cadmium batteries.
4. Set up regulations for the management of chemical agents for cooling water towers: :Choose cleaning solutions with safety certification.
5. Make sure that suppliers and contractors properly manage the chemicals they sell:
The chemical management that suppliers enforce covers aspects ranging from environmental protection,
safety and health, to corporate social responsibility. This must include the investigation and auditing of
supplier internal management systems and an assessment of the risk levels.

HTC 2019 CSR Report104Sustainable Packaging
HTC mobile phone products are packed using materials that make transportation safe and add aesthetics tothe products upon delivery. We also consider the impact the packaging materials will have on the environment
when they are discarded. The materials we use must be compliable with the regulation, environmentallyfriendly, and sustainable. In packaging design, consideration is given to the following:
1. Reduction of the amount of material used;
2. The use of biodegradable raw material;
3. Printing with environmentally friendly ink (soy ink);
4. The facilitation of shipment;
5. Mark following recycling symbols on the box to show the consumers recycling packaging material.

History of HTC “Sustainable Packaging”

VolumeHas been reduced year by year,
one pallet can carry more packs

Transportation
All the packaging materials for HTC products are compliable with the EC directive on packaging (EU 94/62/
EC) and the US requirement on packaging (Model Toxics in Packaging Legislation of USA). The printing ink
used on the packaging material is low-volatility ink or soy ink certified by the American Soybean Association.
These efforts minimize the impact of our product packaging materials on the environment.

Results

One pallet can carry
more packs
and help reduce freight

WeightHas been reduced, helps toreduce CO2 emission resulting
from transportation

Material

Fast growing materials(sugar cane, bamboo)

Use more fast growing materials to improve material resource regeneration andemit less carbon footprint

HTC specially selects mobile phone cases that are integrally formed and lightweight. Formed by 65% sugar
cane bagasse and 35% bamboo pulp, and is 100% recyclable and biodegradable. Compared to regular boxes
made of wood, these boxes made of sugar cane residues and rapid-growing bamboos are more environmentfriendly and are also lighter than regular boxes.
When the HTC mobile phones are shipped, in addition to the product information labeling according to
the requirements of customers and relevant regulations, HTC has elaborated the energy-saving and powersaving functions in the colored mobile phone box and manual. The HTC mobile phone box is made withenvironmentally friendly materials as well as fully recyclable and biodegradable paper. Furthermore,“Forest Stewardship Council” certified paper, is printed on the box to alert the consumer to the concept ofenvironmental awareness.
The achievements of mobile phone packaging over the years

2009

2013/2014

2015

2016

2017/2018

Hero Box

M7 /M8 Box

M9 BoxM10 Box

U11/U12+ Box

Dimension

183x89x60mm

160x160x28mm

160x160x28mm

180.5x150.5x33.5mm

202x165.5x34.5mm

Total weight

170g

95g

95g

111g

149.2g

0.89

0.89

1.04

1.4

This box is 98% composed of recyclable paper
and material.
It is made at least 75% from fast-growing
bagasse (a sugar cane product and bamboo).
It was printed using vegetable-based ink rather
than petroleum-based ink.

Materials consist of current fast
renewable plants.
Fewer colors, less ink used for printing
No other glazing processing is used forprinting.
Top label: from 5 colors to 1 color
printing.

Materials consist of current fast
renewable plants.
Reduce the printing area, printing
color.
Do not use glazing plastic.

Packing materials are completelychanged to fast-growing materials to
reduce the use of paper packaging.
Direct stamping on the box top reduces
the printing area and printing color andink use.
Glazedplastic
not used.106
HTC 2019
CSRis Report

Transportation Carbon
Footprint(kg CO2eq)
ECO Features

105

1.59
Package volume reduced by 50%.
Soy ink used for printing.

Sustainable Agenda

Note: Calculate the distance: from HTC factory  Airport (by air)customer’s distribution center

The material of VR packaging
Utilize recyclable packaging materials and lightweight design

Dimensions
Weight

2015

2016

2017

2018

2019

Rigid Box

Rigid Box

Pizza Box

Pizza Box

Pizza Box

574x420x212mm

415x295x181mm

532x344x185mm

418x338x188mm

520x302x182mm

3,000g1,800g2,250g1,200g1,570g

6pcs

24pcs

20pcs

30pcs

24pcs

28.14

16.88

21.11

11.26

14.73

Printed withtwo colors andreduce the ink
use.

Volume reducedby 55%.

Reduce printing
with ink.

Reduce printing
with ink.

Weight loss by
40%.

Share toreduce thegeneration of
new packaging
materials.

Extremely
simplified
packagingdesign.

Reduce inner
packaging withplastic

The Number
of Pallets

Transportation
CarbonFootprint(kg CO2eq)

ECO Features

Printed withtwo colors andreduce the ink
use.

107

Sustainable Agenda

Use higher
recycled
materials on theouter box

Sustainable ProductsLife Cycle Assessment and Carbon Footprint Reduce
In response to the global warming crisis, HTC constantly looks for ways to reduce the impact and influence of
manufacture, production, and consumption by users, on the environment. The concept of life-cycle time (LCT)
is our way of thinking about this and we start with R&D. The R&D engineers are provided with quantified andfully comprehensive green information for the initiation of life-cycle-investigation (LCI) on the supply chain
to establish a database of the key parts and components and their environmental impact.
The HTC product carbon footprint is measured in accordance with ISO 14040 and ISO 14044 standards. It
involves direct data provided by the HTC plants and upstream suppliers. The data are put into internationallyaccepted life cycle assessment software and databases like SimaPro and Ecoinvent, which are also fed withindirect data. The data, after passing third-party verification, is made public as a carbon footprint report or
Eco Declaration that gives transparent environmentally related product information to the relevant clients.
The carbon footprint analysis measures the impact of a product on the global climate from the aspect of its
total life cycle starting from the production of raw material, manufacture of the product, its distribution,delivery to the customer, to its end-of-life disposal. Such analysis finds that the carbon footprint of asmartphone is most obvious during the mining of the raw materials and the consumer use phases. HTC will
spend more effort on reducing carbon emission during these two phases.

Taking circular economy as the direction for development
In order to achieve the goal of sustainable development, the thinking of circular economy is adopted to design
and manufacture HTC products. We think about how to use the limited resources of the earth cautiously
so that maximum efficiency can be generated and the effectiveness can be maintained within the industrial
system to achieve sustainable operation. The following are some of our practices:
Easy to recycle product design
Extend the lifetime of products, including continuous software updates and good after-sales service
Use recycled materials for manufacturing and packaging
Reduce the environmental impact of the manufacturing process, use recycled water and renewable energy
Innovative business model, launching HTC VR rental service

109

Sustainable Agenda

Carbon Footprint and Lifecycle Assessment Related
Planning and Reporting Memorabilia
HTC has been conducting product environmental impact investigation and analysis in accordance withlife cycle assessment methods since 2010. The annual action plans are set out below:
1. In 2010, we participated in the Product Environmental Information Disclosure Program of theIndustrial Development Bureau MOEA and completed the Environmental Protection Declaration(EPD) with 19 suppliers.
2. In 2011, we participated in the Low Carbon Product Design Program of the Industrial Development
Bureau MOEA, and completed carbon footprint analysis and low carbon design counseling with 15
major suppliers.
3. In 2013, we cooperated with 11 suppliers to complete the ISO/TS14067 product carbon footprint
inspection.
4. In 2014, our main action plan is to establish carbon reduction targets and action programs byproviding the major suppliers with detailed life cycle investigation data analyses.
5. In 2015, cooperated with 8 suppliers, fulfilled two products carbon footprint inspection.
6. In 2016, water footprint inspection and third-party verification have been accomplished.
7. Starting from 2016, the supplier GHG autonomous inventory was initiated. Suppliers are required tosubmit GHG inventory data in the first half of each year. The response rate in 2019 reached 100%.
8. In 2018, HTC officially became a CDP supply chain program member. In the first year, major suppliers
were invited to participate in the CDP Carbon Disclosure Questionnaire and the annual response
rate reached 48%. In 2019, invited more major suppliers to participate in the survey and the annual
response rate reached 61%.

HTC 2019 CSR Report110Friendly
Workplace ___Staff Management
Human Rights and a High Standard of Professional Ethics

Overview of Human Resource Structure

HTC is an international corporation and continued to be a member of the Responsible Business Alliance(RBA) in 2019, we attach great importance to the human rights of labor, and the principle of equality andanti-discrimination is our core concept for multicultural employees. We provide equal and fair employment
opportunities for employees. There is no race, gender, age, physical and mental disabilities, religion or
ethnicity. Or any other form of discrimination protected by relevant laws.

HTC recruits promising talent from all around the world. At the end of 2019, HTC global employee workforce
totaled 3,905. Of these, 33.41% were foreign supervisors, accounting for the total number of executives
worldwide; foreign supervisors and professionals together accounted for 23.22% of the total number of
executives and professionals worldwide and 24.60% of the supervisors were women.

No Child Labor
HTC strictly prohibits the use of child labor in our own manufacturing facilities as well as those of ourmanufacturing suppliers. We mandate proof of age for employment to ensure we meet all local labor laws andthe requirements of the jurisdictions where we operate. Even student workers need to be 16 years old.

HTC Code of Conduct
We place great importance on employee integrity
and uphold high ethical standards. The company
has established the “HTC Code of Conduct” as theprime directive that directs all our employees in
the performance of their work. Every person in our
employment, in any of our branches and subsidiaries,
no matter their position, level and location, mustcomply with these ethical standards. In countries
where HTC has a manufacturing presence, this Codeis higher than any local regulations unless a provision
is inconsistent with a legal order issued by the local
government.
New employees undergo an orientation training
session on the same day they report for duty. They
learn about the HTC corporate policy, the Code of Conduct for employees, ESH policy and corporate social
responsibility and anti-corruption and sexual harassment issues were also included. An e-learning programfor new employees is also provided that explains the HTC corporate principles using exemplary cases. There
are physical and online courses for retraining for all employees every year. In any case of conflict with the laws
in force in places where HTC operates, the local HTC HR team shall submit the context of the laws at issue to
HTC HQ for review. Except for a case such as the above, any violation of the “HTC Code of Conduct” can leadto serious disciplinary action, including the termination of employment.
To ensure that the “HTC Code of Conduct” is fully implemented, we conducted the external third-party
compliance verification for the implementation of the “HTC Code of Conduct” in 2018. The verification was
passed and relevant certificates were obtained. We will continue to improve and practice the Code of Conduct
in the future.

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HTC’s turnover rate of direct workers in 2019 was 12.5%*, with the statistical frontier encompassing the
Taiwan region (including students involved in industry-university cooperation programs, interns, and foreign
workers). The indirect workers turnover rate was 11.4%, with the statistical frontier covering the world.
*Note: Turnover rate= the number of employees leaving the company/ the total average number of employees per year. The figure does not include employees who were involuntary
resigned employ

HTC Human Resource Structure Overview
Gender

Unit

2017

2018

2019

Male

Person

5,151

2,679

2,304

FemalePerson

5,240

2,131

1,601

Male

Person

5,113

2,641

2,269

FemalePerson

5,204

2,105

1,555

Male

Person38

38

35

FemalePerson

36

26

46

Male

Person28

35

29

FemalePerson

36

32

31

Male

Person

1,279

629

359

FemalePerson

3,697

1,212

709

Male

Person

3,872

2,050

1,945

FemalePerson

1,543

919

892

Male

Person8

21FemalePerson300≤29 years old

-

%

38.76

27.90

23.10

30~50 years old

-

%

56.63

66.82

70.91

≥51 years old

-

%

4.61

5.28

5.99

Global Employee

Employees under indefinite contract

Employees under fixed-term contracts

Part-time personnel

Manufacturing employees

General employees

Taiwan dispatch personnel

Note: 1. The percentage is calculated as the number of employees in each category divided by the number of employees worldwide.
2. The Employees under indefinite contract includes general employees, foreign employees, R&D substitute service, interns, student workers and consultants.
2. The dispatch personnel worked as supportive assistants.

HTC 2019 CSR Report114America
RegionEurope,Middle East & Africa

210

107

Europe,Middle East
& Africa

America
Region

106

196

Male
Age

Manufacturing
Employee%

The Global
Distributionof HTC Personnel

≤29

79

30~50

in 2018
Total

4,810
Asia-PacificRegionThe Global
Distributionof HTC Personnel

4,493

in 2019
Total

3,905

General
Employee%

Middle Supervisor%

Senior Supervisor

%

2.02

427 10.93%

31

0.79

0

0

261

6.68

274

7.02%

1,083

27.73

41

1.05

≥51

19

0.49

6

0.15%

66

1.69

17

0.44

total

359

9.19

707 18.10%

1,180

30.22

58

1.49

Age

Manufacturing
Employee

Middle Supervisor%

Senior Supervisor%≤29

Female%General
Employee

%

138

3.53%

209

5.35

18 0.46%00America
Region30~50474

12.14%

217

5.56

409 10.47%

10

0.26

Europe,Middle East & Africa

≥51

97

2.48%

6

0.15

17 0.44%

6

0.15

245

169

total

709

18.16%

432

11.06

16

0.41

Asia-PacificRegion3,603

By Age444

11.37%

Note: The percentage is calculated as the number of employees in each category divided by the number of employees worldwide.

By Position

The Global
Distributionof HTC PersonnelYear

in 2017
Total

SeniorMale

10,391
2017

9,977
By Country
2018

Foreign employees

MaleFemaleMale

Female

2017

4,416

2,899

735

2,341

2018

2,198

1,603

481

528

2019

1,856

1,285

448

316

General

Total

75

2,343

2,733

5,151

22.55

26.30

49.57

13

674

4,553

5,240

%

0.13

6.49

43.82

50.43

Total

88

3,017

7,286

10,391

Male

52

1,239

1,388

2,679

%

1.08

25.76

28.86

55.7

12

453

1,666

2,131

0.25

9.42

34.64

44.3

64

1,692

3,054

4,810

FemaleFemale
%
Total

2019

Middle0.72%

Asia-PacificRegionDomestic Personnel

Level

Male

58

1,180

1,066

2,304

%

1.49

30.22

27.30

59

16

444

1,141

1,601

0.41

11.37

29.22

41

74

1,624

2,207

3,905

Female%Total

Note: Senior: CEO, CMO, CFO and other executive positions above Vice GM.
Middle: Department Heads, Managers, and Section Chiefs.
General: Engineers, Overseers, Foremen, Administrators, Assistant Technicians, Trainees, Student workers, and foreign employees.

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HTC 2019 CSR Report116Care for Foreign Employees

HTC New Recruits of Employees Worldwide Statistics in 2019
Unit

Asia

America

Europe, Middle East, Africa

MaleFemaleMale

FemaleMale

Female

161

101

10

10

3

5

30.26

18.98

1.88

1.88

0.56

0.94

139

55

20

10

8

1

26.13

10.34

3.76

1.88

1.50

0.19

3

1

2

2

1

0

%

0.56

0.19

0.38

0.38

0.19

0

Sum

Person

303

157

32

22

12

6

Total

Person

≤29

30~50

≥51

Person%Person%Person

460

54

18

Note: The percentage of each age range is calculated as the number of employees in each category divided by the total number of new employees.

The top priority for HTC when dealing with foreign employees is to raise the awareness of anti-discrimination
regulations, to eliminate repulsion harassment and the lack of proper discipline in the workplace. The
provision of an open communications channel and an appeals system is also necessary to ease the disquiet
many foreign employees feel when working and living abroad in Taiwan and to allow them to concentrate on
their work. In addition, the health check of foreign employees is included in the system management, and thedata tracking management after the health check is carried out to ensure good health.
HTC’s dormitory area offers air-conditioning, prayer rooms, TV entertainment and other facilities. The public
compound space can be used as a Chinese classroom and employee lounge. The public space in the dormitory
area is managed by the cleaning unit to carry out regular environment sanitation. We regard foreign employees
as regular employees without any discrimination. In January 2019, based on the decision of foreign employees,
we decided to change employees traveling subsidy into PX Mark gift certificate, appreciating foreign employees
hard work throughout the year.
In addition to providing comprehensive orientation, we also emphasize life care for foreign employees. Apartfrom hiring translators, administrators and counselors who are skilled in native languages, providing life,
language, culture and mental health assistance. In 2019, a total of 269 foreign employees were counseled. Most
issues were related to living regulations, such as accommodation, transportation, etc.

HTC Turnover of Employees Worldwide Statistics in 2019
Unit

Asia

America

Europe, Middle East, Africa

MaleFemaleMale

FemaleMale

FemalePerson

255

274

9

5

0

1

%

17.37

18.66

0.61

0.34

0

0.07

Person

394

390

27

16

15

6

26.84

26.57

1.84

1.09

1.02

0.41

Person

22

54

0

0

0

0

%

1.50

3.68

0

0

0

0

Sum

Person

671

718

36

21

15

7

Total

Person

≤29

30~50

≥51

%

1,389

57

Note: The percentage is calculated as the number of employees in each category divided by the total number of turnover of Employees

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Value and Listen
to The Voice of
Our Employees

Making detailed records of their feedback
Express ideas and thoughts of workers
Keep track of follow-up effects
Respect workers’ decisions

Life & Leisure

A cleaning unit that cleans the dorm around the clock.
24-hour hot water supply
Free Lesson of learning Chinese
TV Entertainment

Proper Health
Examination Program

Regulate the frequency of foreign labor health examinations in accordance with
relevant laws and regulations
Health Examination Follow Up
Entry health check (General physical examination, general items designated by theCouncil of Labor, intestinal parasites, chest X-ray examination, dengue fever, Handisease check)

Tax Refund Check

Provide clear information on taxation principles and period of tax refund in advance
Encourage to keep following tax refund
Follow up of tax refund check
Departing before filling out “Receipt Authorization Letter”
Tracking intermediate rebate cheques
The announcement of tax-receiving time
Tax receipts with identification

Enhancing Physical and
Mental Health Activities

Irregular opening of the “Counseling station”

22

HTC 2019 CSR Report118

Talent Attraction & Retention

Complete Education and Training Plan

HTC deeply understands that “The key to maintaining the momentum of innovation in a company lies in its
having competent and talented employees”. In addition to encouraging our employees to explore the unknown
and commit to bringing innovative designs to daily life, HTC remains committed to providing a multi-cultural,
highly challenging and vital working environment. In this way, talented people from both the East and theWest can try their best and play to their strengths.

The cultivation of talent is the foundation of a going business concern. HTC, while engaged in the pursuitof growth and profit, is also committed to helping employees grow with the company. The creation of anenvironment that will help them continue to do this is very important. HTC is guided by business needs aswell as personal career development. The company strives to provide employees with enhanced professional
skills, in addition to assisting them to seek a good career development direction; HTC has classified talentmanagement and development as an important management indicator. Employees should improve and growwith the company.

HTC is globally based, and adheres to the business philosophy of “Choose People with Talents” by actively
recruiting outstanding R&D talents at the location of its operation bases. To ensure that the knowledge
and skills of the talents are in compliance with the needs of the company, HTC regularly participates in the
recruitment activities and symposiums held by universities, offering opportunity for students to interact
and exchange information with the company. Each year, internship program is offered to undergraduate
students, allowing them to get the first taste and adapt to corporate culture, which will help them to develop
the workplace skills that are required. After the internship is completed, potential talents will be selected to
become the full-time employees of HTC when they graduated from university.

Campus Recruitment Campaign
to Welcome New Graduates from Various Fields

Mid- andLong-term
Goals for
TalentCultivation

Target yea: 2025
According to the annual training plan signed every year, the actual
rate of trainings implemented must reach 95%
For the annual training courses, students’ overall after-training
satisfaction score must reach 4.5/5

Diversified Learning Channel, Providing a Comprehensive Learning Environment
The design of the internal training courses is centered on the five core occupational
functions and the learning effect is substantiated through a series of diversified channels.
There are physical and online courses for learning skills and drills.

In 2019, HTC participated in the Job Expo organizedby the National Taiwan University and the Yourator
Innovative Career Platform, the Job Expo organized by the
National Chiao Tung University and the National Tsing
Hua University, and seminars such as Jcconf, Kubernetes
Submit, ICIP IEEE, Mobile HCI, etc. to recruit talents in
Taiwan and worldwide. We have recruited top talents in
product design, art design, R & D technology, engineering,business management, international marketing,e-commerce, digital marketing, and other related fields.
We continue to promote international talent cultivation,
increasing the overall competitiveness of the company.

Engaging Diversified Talent
2017 2018 2019
HTC offer job opportunities for diversified talents. At theend of 2019, 42 disabled people (weighted) were employed,
Disabled employees (male)54
31
25
which is 10 more than the required number (the required
number is 32). In addition to relying on talent-job matching
Disabled employees (female)42
20
17
conducted by the supportive or sheltering bodies, we also
allocate jobs in consideration of the characteristics ofindividual handicapped workers. We can also tailor job descriptions and the working environment, to allow thehandicapped to have the opportunity to prove their abilities. Through education and training is also provided
to allow the handicapped to make a contribution to society and enhance their own quality of life.

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Experts in various fields are invited from around the world to share industry trends andfuture technology blueprints in creative thinking forums.
Learning tools, such as a mobile library and online learning platforms, are provided toencourage employees to study voluntarily.

After reporting to work,
Comprehensive training courses
will be provided in the following
week. “Newsletter” will be sent
to colleagues every week within
the month after reporting towork to blend into HTC culture
and develop all the necessary
knowledge and skills as soon as
possible. This training also helps
them appreciate the corporate
environment and recognize the“Quietly Brilliant” culture of thecompany.

General
Employees

New
Employees

Manufacturing
Employees

We e n s u r e m a n u f a c t u r i n gemployees gets all the
professional knowledge andtechnical skills training needed
for their occupation categories
and specialization (basic,
professional, advanced).

The
Management

To foster our key leadership teams, we have specially tailored Leadership Development Framework training forsupervisors at all levels. The curriculum is planned and combined with HTC core values, organizational development
strategy and direction, as well as leadership and management functions. To ensure that these courses further the daily
work of the directors and substantiate their leadership and performance, follow-up action plans are formed for each ofthese learning courses. These are devised to assess performance both before and after training, in such aspects as thesupervisor’s counseling records, subsequent presentations, and so on.

HTC 2019 CSR Report120Comprehensive Education and Training
To develop employee capability to meet global
technology challenges and grasp the movement of theindustry, we construct a complete education and training
system coupled with internal and external training,providing employees with professional and life skills. The
design of the internal training courses is centered on thefive core occupational functions and the learning effect issubstantiated through a series of diversified channels.

Planning &Organizing

Communication& Inﬂuencing

HTC Manager Week

Core
Competency
Driving For
Results

Customer
Focus

Teamwork

To allow supervisors (management) to learn new ideas and concepts from the best practices in the industry,change their inherent thinking patterns, and trigger new behaviors or approaches in work and management,
we implemented the Manager Week event. In this event, we shared with supervisors articles that are related
to the 3 major management competencies on Friday of every week. In 2019, a total of 49 articles have beenshared, allowing supervisors to get the latest management information by reading the shared articles every
week during their busy work, and keeping them connected with the world.

Newcomer Training Courses
HTC provides a complete training system for new
recruits. Starting from their reporting, we assist
newcomers in quickly integrating into HTC’sculture and develop a full range of knowledge
and skills through a variety of physical and online
courses. Newcomers are encouraged to share allkinds of matters taking place at HTC with a senior
employee, Newsletter will be sent to colleagues
every week within the month after reporting towork to help newcomers getting familiar with HTC
culture quickly, and blending into HTC’s big family.

Cultivating Key Leaders
HTC actively promotes company culture in the face of rapid changes in the global industry and new patternsof global enterprise competition and cooperation. HTC quickly adapts to a constantly changing environmentand cultivates management talent with an international vision, expecting their excellent managers to becomepresent and future drivers who will continuously lead HTC towards steady growth and development in timesof hardship and challenge. In 2019, leadership-training courses were given to 195 person-time.
To cultivate key leadership teams, the company tailored a series of leadership courses for leaders at different
levels. The design of the course not only combines the core values of HTC and the direction of organizational
development strategy, but also strengthens the three functional aspects of company leadership management:● Leading People● Leading Change● Strategic Thinking & Decision Making

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Manufacturing Department Management Course
In 2019, HTC also conducted several management courses for supervisors of the Manufacturing Department;a series of courses has been planned for junior and mid-level supervisors. In this series of courses, 2 course
sessions have been arranged for junior and mid-level supervisors separately, with a total of 81 people
attended the event. An average satisfaction score of 4.63/5 was achieved.
The courses for junior supervisors are focused on the skills and application of work implementation
management. This series of courses provides junior supervisors with skills and tools for work planning,
employee problem solving, and follow-up evaluation. At the same time, they also strengthen supervisors’communication, coordination, supervising and checking skills, and focus on how to establish good employee
relations. Through the courses, junior supervisors will understand the roles and responsibilities of asupervisor and the required capabilities. In addition, the management competency of supervisors canbe improved through practice, and related leadership skills and tools can be applied to the actual work to
improve work efficiency and interaction with employees, effectively reducing employee complaints.
The courses for mid-level supervisors are focused on departmental performance management and guidance.
This series of courses provides mid-level supervisors with skills and tools for work planning, employee
problem solving, career goal setting, and decision making. They also strengthen supervisors' skills incommunication and coordination, performance evaluation, reward and punishment, and subordinate
development. Through the courses, middle-level supervisors can develop their capability in work
management and execution, and use situational leadership to guide their subordinates, achieving the effectof talent retention and motivation.

HTC 2019 CSR Report122Training and Performance Integration
HTC is expanding and moving steadily forwards. We hope that our employees will grow with the company.
This is why we enforce the performance evaluation system and hope that every employee has a very clear
career goal that will both improve their own job performance and coincide with company business policy forthe achievement of better performance. This mechanism allows employees to become more proficient at theirwork through their own efforts to create a brighter future for both themselves and the company.
The HTC training and development system is closely linked to performance management. General employees
sets their own performance goal at the start of the year. They can provide updates about progress any timeover the following months. However, at mid-year and at the end of the year their performance is evaluatedby an immediate superior, in terms of how much of their set goal has been achieved. On the basis of thisevaluation, they are required to set a goal for the next year as well as a focus for learning and development.
For manufacturing employees, on-the-job training will be provided and assessment will be given based on thequality of work and the degree of cooperation.

Learning Management System(LMS)The HTC Learning Management System(LMS) gives employees a range of learning tools and more flexibility
to study according to their needs and without the limitations of time, location, and the associated stress. They
can also watch and listen to recordings made by experts or browse the rich collection of books in the library
online. It is very easy and convenient to learn professional and occupational skills without unnecessaryinterruption. In addition, an extra after-course interactive discussion area assists employees in exchanging
learning experiences, browsing and reviewing substantive courses and highlights of celebrity lectures,continuously strengthening learning skills and demonstrating professional performance.

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Special Training Courses and Resources
Legal Training
HTC stipulated special regulations in its Code of Conduct to regulate confidentiality provisions, company
assets, information and personal information protection, employees and their immediate family members
and customers, standards of social and business etiquette for suppliers, travel, conflicts of interest, external
part-time job, internal trading, etc., to guard against dishonesty, as well as penalties for violations. Employee
Reporting Mailbox is also provided as the complaint channel for employees. HTC puts emphasis on legal
education, and add legal training as a compulsory course for new employees. Examples were included in thee-Course for promotion.
Anti-corruption training rates for Board of Directors
and all levels of the New Employees in 2019
GeneralWorkforce

MiddleSupervisors

SeniorSupervisor

HighestGoverning Institution

Number of training recipient

252

75

2

8

Recipient rate

11.4%

4.6%

2.7%

80%

Note: The calculation for the training recipient rate at each level is based on the number of person completing the training/the number of employees at the specific level. The calculation
for the training recipient rate of the highest governing unit is based on the number of Directors completing the training/the total number of Directors.

HTC New Employees Legal Training
Course Content

Number ofparticipants

Course Hours

2018

2019

2018

2019

General new employees legal training - confidentiality and anti-insider trading

368

329

36

36

General new employees legal training – intellectual property rights

368

329

38

38

General new employees legal training – patent litigation

368

329

38

38

HTC 2019 CSR Report124Thinker ForumTo allow employees to keep updated on the newest trend and expand theirvision in product application, we continued to promote the “Thinker Forum”
in 2019, and invited pioneering experts from around the world to give 3
lectures. The themes of the lectures were in line HTC’s R&D emphasis.
Speakers from various fields were invited to share their knowledge ofindustrial trends, novel technologies and future technology blueprints with
our employees, allowing our employees to share the industrial trends, novel
technologies and future scientific knowledge as well from their practicalexperiences and case studies, expanding their horizons in product application.

Individual Development Talk
HTC has organized personal development learning seminars based on the five core competenciesof the company. Each seminar was opened for two hours and speakers who are experts from various
fields were invited. In 2019, a total of 3 personal development and learning lectures were held, inviting
brain science expert Hong Lan, Chinese top 100 lecturer He-Quan Li and cognitive scientist Zhi-Hao
Cai to give wonderful speeches to our employees. A total of nearly 360 people participated in the threelectures, allowing our employees to enrich their soft power in addition to their professional skills. Fromthe practical experience and case sharing of experts in various fields, new methods can be learned tomake work easier and more effective.

Thinker Forum Case Sharing
In addition to smartphone and virtual reality (VR) businesses, HTC also extended its territory to
blockchain. It released the second-generation blockchain mobile phone in 2019 and was selected by
Forbes in 2019 as the world’s top 50 enterprises who lead in blockchain.
On October 15, 2019, HTC was honored to invite the 23-year-old Taiwanese blockchain star Jeff YaoJie Hu to share with us on the topic of “Blockchain from Zero to One”. Jeff not only was an invited
scholar at the Blockchain Research Institute in University of California, Berkeley, but also the Chief
Technical Director of New York News Blockchain, BlackbirdAI. He is also the co-founder and CEO of
the Turing Chain. He has published three blockchain papers in the authoritative forum ACM, IEEEand international journal CPE, and was awarded the best paper in 2018 at the CryBlock in Munich,Germany. He has won more than a dozen international awards including the Microsoft Dream Cup 2017
Hong Kong runner-up and South Korea 2018 UpTown financial technology competition runner-up.
On the day of the event, nearly 150 employees from various departments who wanted to learn about
blockchain participated in the lecture. Jeff gave a wonderful speech to the audiences with his richpractical experience. He guided the audiences from the basic introductory knowledge of blockchain
in an easy-to-understand way, and then used more advanced materials and tools to explain related
applications and future trends.

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HTC 2019 CSR Report126English Leadership Resource and External Training Subsidy
As an international brand, in order to encourage employees tocontinue learning, HTC has opened weekly business English
courses since 2017, providing themes needed for work so that
employees can improve their English proficiency.
All courses are guided by professional foreign teachers andthe topics of discussion are based on situations that may be
encountered in the workplace. Topics of the courses thathave offered include: business email, business negotiation,customer complaint handling, business meetings, etc., allowing
employees to make full use of the weekly gathering at noon
to strengthen their English communication skill and apply
it in the workplace! In 2019, a total of 40 courses have been
conducted, and a total of 621 people attended the courses.
In addition, HTC encourages employees to continue to absorb
professional knowledge and to match their study program to theirwork to ensure growth. HTC encourages employees to improvetheir professional knowledge via schools or other academic institutions, and apply the acquired knowledge
to their work. The cost of the external training can be reimbursed at the end of the training upon application(reimbursement is based on the actual expenses). The subsidy provided for external training in 2019 was about
2.55 million.

Training Result
In order to cultivate HTC employees to quickly respond to fierce challenges from global technology andgrasp the industrial pulse, in addition to upgrading the professional technical annual training courses anddepartment professional courses, in conjunction with HTC’s policy, organizational learning planning was
conducted, coupled with external training subsidies and other measures. Between 2017 and 2019, HTC
invested nearly NT$ 16.447 million in employee training-related programs. Training hours totaled 336,000
and there were nearly 164,700 attendees, each person receiving 52.8 training hours.
In 2019, HTC male employees received 41,496 hours of training and female employees received 31,753 hours of
training. General staff received 50,297 hours of training, supervisors received 22,656 hours and management
297 hours. The table below lists staff training over the years:

Year

Course (Hours)

Number of Participants

Average Training Hours

2017

155,188

74,425

14.93

2018

108,359

55,633

22.39

2019

73,24934,71318.76

Note: 1. Total number of training hours of the year/total number of employees of the year = average number of training hours per person of the year.
2. The average number of training hours per person in 2017-2019= total training hours in 3 years / average number of employees in 3 years. (8,720 person).

Employees Training Hours and Sex Ratios at All Levels in 2019e-Library
HTC relocated its library to the Taipei Headquarter Building
in 2018. HTC helps staff develop good reading habits mainlyby the provision of a wide range of reading activities and a richcollection of library resources; employees can enjoy a richliterary atmosphere and reading environment. Electronicmagazine services are also made available for employees sothey can view and read the current editions on their computers
or mobile phones anytime anywhere. The number of people
subscribing to our electronic magazine reached 38,600 in 2019.

Item

Sex

Total Training (Hour)

Average Training (Hour)

Male

FemaleMale

FemaleGeneral workforce

23,353

26,943

21.9

23.6

Supervisor

17,869

4,787

15.14

10.78

Manager

274

23

4.72

1.43

Level

Note: Average training hours per person of each gender level = total training hours of each gender level / number of employees of each gender level in the current year.

Through organizing “Enjoy the Reading,” providing employees with a platform for discussion and enhancing
knowledge in various fields. In 2019, HTC Library held the “Lending King” activity, and the top three who had
the most accumulated physical books in the year received exquisite gifts at the end of the year, enhancing the
HTC workplace and promoting a good reading culture, so that learning will never stop. Each season’s “Books
Digest” allows employees to quickly absorb the essence of the book in addition to their work. We organized alibrary action book fair with irregular lectures to enable employees to join the ranks of reading and learning.
In 2016, the monthly learning e-newsletter “HTC Learning Charging Station” was launched, integrating all
training resources and information so that employees can grasp all kinds of learning information at the firsttime, explore learning horizons, and plan for self-learning.

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HTC 2019 CSR Report128

A Sound Wage and Welfare System
HTC is committed to fulfilling the needs of its employees and provides all kinds of appropriate welfare
measures as well as attractive and motivating compensation and benefits programs. We encourage our
employees to do their best and share the growing profits of the company.

Employee Salary and Benefit Increase Ratio

HTC hires new employees through open selection procedures, with candidates offered positions andappropriate wages based on academic background, professional years and market standards. We promise nodiscrimination based on ethnicity, skin color, social status, language, religion, political affiliation, country/
region of origin, gender, sexual orientation, marital status, appearance, disability, professional association
membership or other similar considerations not relevant to job performance.

Total employee salary andbenefits expenses (NT$)

What’s more, the performance evaluation system is implemented yearly. Wage will be adjusted and bonuses
will be given based on employees’ performance, work commitment, accountability, level of dedication anddevelopment in the future. In this way, employees’ wage and development will be assured. Performance
evaluation system can be integrated into corporate finance to encourage employee’s persistent devotion
and innovation.

HTC Salary Ratio for Men and Women in Taiwan
General Staff
General
Employees

Manufacturing
Employees

Mid-Level
Management
Salary Ratio

High- Level
Management
Salary Ratio

New Recruits Basic Pay and Taiwan
Minimum Wage Rate

Male

Male

Male

Male

Type

Basic Pay
(Manufacturing
Employees)

Minimum
Wage

1

100

100

2

105

100

Female

110

100

101

Female100

114

Female100

115

Female100

Note: 1. Equation = (Average monthly pay for male / Average monthly pay for female) × 100%
2. Type 1—five-day workweek scheme. ; Type 2—monthly rotating shift scheme.
3. Middle-rank male supervisors are mostly male R&D personnel, while female employees are mostly engaged in administrative work, thus the varied basic salary ratio.

HTC Average Compensation Ratio for Men and Women in Taiwan
General Staff Average Compensation Ratio
General Employees

129

Manufacturing Employees

MaleFemaleMale

Female

116

100

101

100

Friendly Workplace

Mid- Level
Management Average
Compensation Ratio

124

100

2016

2017

2018

2019

2019 vs. 2018

8,704,953,000

8,703,019,000

5,705,420,000

4,201,438,000

26% reduction

Item Description

High- Level
Management Average
Compensation Ratio
Male

Female131

100

Note: 1. Total employee salary and benefits (proprietary financial statements).
2. The decrease in cost in 2018 is due to the decline in the total number of employees.

Mean and median of full-time employees in non-supervisory positions
Item

Unit

2018

2019

2019 vs. 2018

Full-time employees

person

5,632

3,658

65%

Average salaryNT$868,000

1,097,000

126%

Median salaryNT$

Not applicable

790,000

NA

Note: 1. Total salary: refers to the employee’s salary attributable to the current year with accrual basis, including regular salary (primary salary and monthly fixed allowances andbonuses), overtime pay (whether taxable or tax-free) and non-regular salary (non-monthly allowances, bonuses, employee compensation, etc.), but does not include retirement
pension.
2. Supervisory position: The definition of manager is based on the scope of “manager” stipulated by the competent authority’s Letter No. 920001301 issued on March 27, 2003,
which is consistent with the scope disclosed by the company’s annual report.
3. Full-time employees in non-supervisory positions: refer to the number of full-time employees (including Taiwanese and foreign employees) in the company, which is
calculated by deducting those with supervisory positions, employees of overseas offices, part-time employees, and those who are eligible for exemption from statistics from all
employees of the company (or permanent employees)

In addition to rewards on remuneration, HTC also plans to implement incentives and retention bonuses for
employees based on the concept of profit sharing and talent retention. We’ve designed a bonus system forpatents, and competitions for quality improvement issues, with competition bonus programs offered.
HTC has an official and lawful retirement and pension plan that was established when the company wasincorporated. An amount equivalent to 2% of the monthly salary has been appropriated in the retirement
reserve since November 1999. An amount equivalent to 8% of the monthly salary has also been appropriated asa retirement reserve by the Labor Pension Committee since 2004. After implementation of the new pension
plan on July 1, 2005, in addition to the legal reserve for those employees who selected the new pension
contribution system, those employees with the old seniority system, after presenting the actuarial results tothe competent authorities for approval, have their appropriation rate adjusted from 8% to 2%. In May 2019,
since the reserve for old retirement pension had reached the standard level, the issuing of old pension was
suspended for one year upon approval by the competent authority.

HTC 2019 CSR Report130Diversified Employee Welfare
In addition to providing all employees with labor, health insurance, club activity subsidies, departmental
dinners and employee gyms, it also provides full-time employees with labor retirement and group insurance,
employee health checks, allowance on the Dragon Boat, Mid-Autumn, and Chinese New Year holidays,
wedding and funeral subsidies, employee subsidies, and annual travel subsidies and other benefits.
The HTC’s Welfare Committee is responsible for all employee benefits matters, including education
scholarships for children, festival gifts, department travel subsidies, activity subsidies, and group insurance.
The committee is also responsible for the gymnasium and outdoor playgrounds.

Encouragement for Senior Employees
In addition, trophies are presented in recognition of service to employees who been with the company for five,ten, fifteen and twenty years. HTC also has an internal replacement system to provide the necessary assistance tostaff needing to be transferred, or to those making application for transfer, or who are seeking job enrichment ora change of career.

2019 End-of-the-Year Appreciation Banquet
The 2019 HTC End-of-the-Year Appreciation Banquet was held in Nangang Exhibition Center, Hall
2 in January 2020. During the event, Chairwoman Cher Wang and CEO Yves Maitre, together withthe management team attended the Party to thank the employees for their hard work in the past year,
thanking all employees from the HTC team for their perseverance, efforts, and persistence in developing
innovative and breakthrough technologies, hoping to bring consumers with greater and better products.
More than 200 tables were served at the 2019 HTC Year-End Party, with Mickey Huang and Pink Yangas the hosts, and singer Eric Chou was invited to perform. The opening ceremony began by Chairwoman
Cher Wang and CEO Yves Maitre jointly completing the “HTC” LOGO sand painting and giving thanks
to employees for their hard work hard in the past year. During the Party, several singers and bands also
performed on stage, making the event fun and enjoyable.

Group Insurance
HTC and the Welfare Committee buy group insurance for employees, so that an employee who is hospitalized
for sickness, injury, or who dies, can still provide some security and protection for their families.

Activity Clubs of HTC
The available clubs are Badminton , Orphanage, The Way club, Basketball and other diverse clubs

Education Scholarships for Children
The HTC Employee Welfare Committee provides scholarships for the children of employees from elementary
school to college: NT$800 for elementary school students, NT$1,600 for junior high school students, NT$2,000
for high school and vocational education students, including first, second and third year college students; andNT$3,000 for college students in their fourth and fifth year. A total of 466 person applied for child education
scholarship for the first semester of 2019, while 407 person applied for the second semester.

Staff Emergency Relief
Employees who become victims of an occupational accident that causes death, disability, injury, or an illness
are entitled to receive compensation from HTC in accordance with the Compensation Act. In cases wherecompensation has already been received by the company in accordance with the Labor Insurance Act or otherlaws and regulations, this can be offset by the company. The company and the Employee Welfare Committee
also offer group insurance coverage.

131

Friendly Workplace

HTC 2019 CSR Report132Multiple Communications channels
Employee complaints system that has a complaint hotline, suggestion and complaint boxes, a complainante-mail service, and a sexual harassment complaint mailbox. Labor meetings and employee opinion surveys
are held regularly for reference by supervisors in such matters as leadership, internal operations, enhancing
employee satisfaction, and work input improvement.

Free Dormitory for Students
HTC has given in-depth consideration to accommodation space and other needs of students. Living andentertainment facilities, such as a library, reading and common rooms, as well as the provision of full-timeadministrators and guards who form a joint force with the police and citizens to ensure the safety and securityof the residents.

2019 HTC Sports Season
The 2019 HTC Sports Season includes “Basketball Full-Court Game”, “Badminton Team Competition”Men's Singles, Women's Singles, Men's Doubles, Women's Doubles, Mixed Doubles, and “Fun Team
Games”- table tennis, basketball shooting machine, VR boxing. The contestants used their sweat toshow the attitude, vitality and enthusiasm of HTC people, and to create a journey of love and dreams
together. During the event, the participating teams showed the sportsmanship of courage, challenge,
and teamwork. The cross-department teams and the cheering of the cheerleaders on the courtside havegreatly enhanced the cohesiveness among employees, and triggered the vitality of the whole company.
Let's keep our body and mind healthy and strong by continuing to exercise, and prepare for better
performance next year.

Transportation Vehicles
HTC offers employees many different means of transportation on several different routes for commuting toand from work. The vehicles provided ensure safety and peace of mind as well as being very convenient.
The shuttle bus waiting area is equipped with shuttle bus GPS monitoring system to allow users can keep trackof the position of the shuttle bus at any time. Furthermore, shuttle bus questionnaires were sent out to collectthe opinions of users, providing better shuttle bus services with more comfort, convenience and safety.

Travel subsidy
Based on seniority, details as below:
Unit:NT$2019
The HTC Employee
Welfare Committee

2019
HTC

2019
Total

Over 5-year tenure (Before 2013/12/31)

3,000

4,100

7,100

Over 3-year tenure but less than 5-year tenure (2014/1/1~2015/12/31)

3,000

1,800

4,800

More than 1- year tenure but less than 3-year tenure (2016/1/1~2017/12/31)

3,000

900

3,900

Less than 1-year tenure (later than 2018/1/1)

3,000

none

3,000

Employee tenure
Base date:2018/12/31

133

Friendly Workplace

HTC 2019 CSR Report134Creating a Happy Workplace

A Five Star Gym
In order to encourage and promote the sports
atmosphere and allow employees to develop good
exercise habits, HTC has set up a fully equipped
professional fitness space in office buildings. Free weighttraining equipment and weight training mat floor wereadded in 2019. Various modern fitness equipment andcoaches are available on schedule to provide guidance
and advice.

Use of the Gym
Category

A Working Environment Incorporating Brand Spirit
Number of Users in
2019

Use of the Gym (person-time)

38,800Participation in aerobic classes(users)826

HTC has commissioned professional fitness management
consulting firms and professional suppliers to manage the gym and to provide full-time services. These
include onsite fitness instruction, fitness curriculum planning, and advice about the prevention of sports
injuries. Six coaches with an emergency card or sports injury protection license were on shifts at the site. This
provides employees with the best health consulting services and the environment. Employees get help for theestablishment of positive sports safety and healthcare. Courses are planned and arranged on various health
topics and activities and employees can participate according to their preferences. In addition, the gym uses
HTC’s online form to register for courses, allowing employees to click on their computers and mobile phones
to register, saving on-site waiting time.
In addition, HTC plans two-month aerobic courses throughout the year to provide a diverse curriculum for
employees. There are Yoga, Pilates, flywheel, core muscle group TRX, Body Combat, muscle sculpture courses
available. Another spectacular sports facility is to be found on the 17th floor of Taipei Office. It is a large hall,practically a stadium, with a 10-meter-high ceiling that can be used for basketball, tennis or badminton. The
gym also commenced additional sports massage classes sold at NT$600-$800/30 minutes were available toemployees at NT$400. Through professional sarcolemma stretch, the employees enjoyed a more comfortable
exercise experience.

135

Friendly Workplace

HTC regards the creativity that stems from brainstorming as one of our most valuable assets. To promoteinterpersonal communication, the R&D headquarters in Taipei is configured with many staff areas thatallow our people to interact and talk, this includes interlacing sky bridges between the buildings that link
departments together and interaction rooms that project from the floors like transparent boxes. We hope thatthese interaction-oriented spaces will encourage and promote cross-department synergism and cooperation,
supporting the free extension of creativity. HTC believes sharing is the best kind of interaction. To this end
we will share Taipei Office with the community, This HTC Gallery will help young local artists show theircreativity and work, promoting social and community interaction. In addition, the HTC Gallery will cooperatewith different institutions and artists to regularly showcase new cultural and artistic works. It will be open to
the community schools, groups, and the public. Let us all get closer to the arts. All the people who work in thisbuilding can also appreciate being in an “art gallery” that will inspire creativity and help HTC launch betterand more amazing products.

HTC Gallery & Sense Arena
To enrich and diversify the exhibitions of the HTC Gallery, we collaborated with Taiwan's
professional art gallery in 2018. Besides exhibiting the works of Taiwan artists, we also exhibited
works of Korean and Japanese artists. The exhibiting artworks have ranged from one-dimensional
paintings to the sculptures and glass arts, making the Gallery lively and rich. This enables HTC staffs
and visitors to watch not only the one-dimensional paintings, but also observe the three-dimensional
artworks in detail. Through the demonstration of artistic works such as color and light to improve thequality of rest and enhance the creativity of employees. Visitors can walk freely around the artworks,
making the process more exciting and fun.

HTC 2019 CSR Report136

Listening to the Voice of the Employee
Valuing Female Employees
HTC regards the female workforce as very important. In view of the increasingly large number and influence ofworking women, we have continued to improve our software and hardware, in the hope that a diverse culture
based on gender equity will help HTC become more competitive. The physical and mental caring mechanisms
we provide for our female employees include:
A female cancer-screening program is part of the annual health check. This includes the choice of a Pap
smear, a breast ultrasound exam, or a mammogram.		
Consideration for the physiological needs of female workers, providing a comfortable environment for
rest, the loan of free hot pads, menstrual pain assessment, health knowledge and education, physician
consultation or referrals and so on.
A friendly environment for breastfeeding. We provide a warm and comfortable nursing environment,ultraviolet milk bottle disinfection devices, microcomputer thermos, comfortable sofa, refrigerator
for breast milk storage, and infant breast-feeding-related publications and light music. HTC has 14
Breastfeeding room in Taiwan that was visited 20,417 times in 2019.

HTC employs nearly 5,000 people around the world. The establishment of a sound means of communication
between management and employees is vital to the growth of a company. Therefore, HTC pays great attention
to internal communication with employees to build mutual trust and create a harmonious atmosphere within
the company.
All responses to proposals and the follow-up progress of these meetings are published on the HTC Intranet
website for review by all the employees. According to internal HTC statistics, the issues most frequently
discussed in the labor-management meetings are “the working environment”, “parking and transportation”
and “catering management”. In 2019, HTC also discussed with the Union on the major changes in humanresource allocation. In addition to regular labor-management communication meetings, we also set up
diversified feedback channels, including setting up grievance lines, appeal boxes, e-mail address for complaints,
and sexual harassment complaint mailboxes. Labor-management meetings and employee opinion surveys areheld regularly as a reference for supervisors, internal operations, improvement of employee satisfaction levels
and improvement of work commitments. A good communications mechanism results in harmonious labor
relations. Labor disputes, bad feelings and losses can all be avoided.
Note: HTC’s labor union was established in 2015, but until the end of 2019, no collective agreement has so far been made.

Work-life Balance Support
In addition, in order to encourage and support
employees to raise the next generation withconfidence, HTC has a perfect application system forparental leave to protect employees’ work rights sothat parents can take care of their newborns with ease.

Employees applying for Family care leave

Labor-management Agreement and Employee Rights

Year

2016

2017

2018

2019

Male

56

66

51

42

Female

144

143

136

103

Total

200

209

187

145

HTC is committed to creating an atmosphere of mutual trust between employer and employees while also
focusing on internal communications. HTC convenes labor-management meetings every quarter and at least
four meetings are held every year. Seven representatives are elected by employees for the meetings while sevenothers are designated by the company. The minutes of these meeting are referred to in the resulting follow-ups,
which include any necessary corrective action. In addition to these regular meetings, employees may also reflect
their opinions through various communication channels. On the other hand, the shortest notice period for major
operational changes shall be handled by HTC in accordance with Article 16 of the Labor Standards Act.

Employees Applying for Unpaid Parental Leave and Resuming Duty after Leave in 2019Male
The Number of Qualified for UPL for Raising Children in 2019

% Female

%

Total

339

54.6

282

45.4

621

The Number of Person Actual Applied UPL in 2019

6

11.8

45

88.2

51

The Number of Reinstatement-to-be in 2019

9

11.4

70

88.6

79

The Number of Application for Reinstatement in 2019

7

12.7

48

87.3

55

The number of application for reinstatement in 2018

18

22.5

62

77.5

80

The Number of Retention Over 1 Year After Reinstatement in 2018

9

22.5

31

77.5

40

Reinstatement Rate in 2019

Retention Rate in 2019

77.8

50.0

68.6

50.0

Note: 1. The “number of qualified for UPL for raising children in 2019” was based on the number of employees who had taken maternity or paternity leave within 3 years (2017-2019).
2. The “number of reinstatement-to-be in 2019” includes applied in 2017 and should reinstate in 2019, applied in 2018 and should reinstate in 2019, applied in 2019 and should
reinstate in 2019.
3. The “number of application for reinstatement in 2019” includes applied in 2017 and reinstated in 2019, applied in 2018 and reinstated in 2019 and applied in 2019 andreinstated in 2019.
4. The “Reinstatement Rate in 2019” = Number of employees reinstated in 2019 / Number of employees that should have been reinstated in 2019.
5. The “Retention Rate in 2019” = Number of employees who had worked one year consecutively after being reinstated in 2018 / Number of employees reinstated in 2018.
6. The “number of application for reinstatement in 2018” includes applied in 20165 and should reinstate in 2018, applied in 2017 and should reinstate in 2018 and applied in 2018
and should reinstate in 2018.

137

Friendly Workplace

Major human resource allocation changes in 2019
To effectively use resources and professional skills, HTC carried out an organization optimization planin 2019. Owing to changes in market and production needs, HTC must ensure that VIVE and mobile
phone businesses can be well developed in the future while providing high-quality products. After
careful evaluation, we believe that this action is a necessary step to achieve HTC’s long-term corporate
goals. We hope the refining of the overall operation can further strengthen the company’s futurecompetitiveness.
In this regard, we are fully committed to assisting the affected employees. We help employees to arrange
job transfers and counseling, etc. in accordance with the laws and regulations of the Labor Standards
Act to protect employees’ rights and interests, hoping to minimize the impact.

HTC 2019 CSR Report138Employee Satisfaction Survey
Out of consideration for employees ‘ feelings about working in the company, which can in turn improve work
efficiency and effectiveness, and reduce the turnover rate, HTC conducts employee satisfaction survey throughquestionnaires. The manufacturing employees questionnaire survey conducted in 2019 consists of 6 categories
including job content, work environment, salary & benefits, internal communication, gender equality, andorganizational commitment. The targeted score for 2019 was 3.50 points (out of 5) and the average score fromthe actual survey was 3.72 points, reaching the annual target. In summary, the employees concerned more
about organizational commitment and salary & benefits. For this reason, relevant activities and plans will
be implemented to enhance employees’ recognition of the company. The questionnaire survey results werealso reported to the senior management team for review, and used as the reference for preparing the annual
operational targets and plans. In 2019, employees were highly affirmed by HTC’s performance in issues such as
the “Implementation of the gender equality law”, “No gender-discriminated salary” and “Being confident indoing your current job”.

Effective Advisory and Assistance Channel
To protect the working rights of our employees, we have set up a diversified and smooth communication
channel that an employee can use to pass on information about problems and to receive a response
without delay. In addition to the employee care office in the major units that provide a relaxing space forcommunication, timely help with workplace problems can also be sought using the following channels. In
2019, employee consultation was focused on largely on the issues of manpower optimization. The company
established a dedicated line to provide employees with comprehensive consulting services. There was no
gender discrimination cases reported in 2019.

Potential
Work
Problems

Advisory
andAssistance
ChannelsWork problems

Consultation and Referral to the Employee Assistance
Program(EAP).

The manufacturing employees questionnaire survey conducted in 2019

Leadership style andcommunication

4.10

3.98

4.00
3.90

Compensation, benefits, andworking hours

3.87
3.79

3.80

3.74

3.70
3.60

3.52

3.50

Workplace sexual
harassment, sexual abuse, or
sexual discrimination

Production line manufacturing employees should dial
extension 38585.
General employees should dial extension 28585.
Employee Help hotline E-mail: HelpMe_8585@htc.com
Open and registration-exempt staff cares office.

3.41

3.40
3.30
3.20
3.10

139

Job Content

Friendly Workplace

Work
Environment

Salary &Benefits

Internal
Communication

GenderEquality

Organizational
Commitment

HTC 2019 CSR Report140Occupational Health and Safety
All our facility management systems comply with the OHSAS18001 standard for Occupational Health and
Safety Management. The scope of system management includes all operations within the factory area(including contractors), and is expected to be changed to ISO 45001 in 2020. Every new employee is given
complete safety and health education training upon entry. We have also published the “ESH Management
Manual” and “Safety and Health Rules” which have also been posted on our Intranet website for employees to
consult at any time.

Occupational Safety and Health Committee
The Occupational Safety and Health Committee has 19
members. Among them, there are 7 labor representatives,
which accounted for 1/3 of the total number, 1 healthcare
professional, 1 labor safety related engineer technician and 7
department managers, supervisors and directors.
We work out an occupational safety and health plan eachyear according to the relevant problems that need to beaddressed. The focus is on asking all the people involved tofollow occupational safety and health rules; to identify hazards
to lower risks; to set up rules for the labeling of dangerous
chemicals and a general understanding of them; the promotionof occupational safety and health information; and the establishment of a system to manage contractors. All
these measures are aimed at reducing risks.
We have emergency response plans that will be implemented in the event of an emergency caused by humanerror or natural disasters, such as fire, explosion, typhoon, an accidental leak, mechanical injury, infectious
disease, or an earthquake. As identification of the nature of the emergency, taking the necessary measures andexamination of standard operating procedures. We hold fire all measures impact on the health and safety of theworkers and also try to least damage or company property.

Food Safety - Hearty and Healthy Meals at HTC
To ensure our employees have “healthy and satisfying food, ”HTC cooperates with professional catering
service providers and dieticians to design and produce healthy, nutritional, and delicious meals using local
ingredients from reputable and certified local food suppliers. The meals are nutritionally balanced and thenumber of calories is controlled, giving HTC employees the opportunity to enjoy high quality and healthy
food. We avoid all questionable ingredients and insist that all purchases have CAS, TQF, ISO and HACCP foodcertification. Branded food commodities are given top priority and we always support the local agricultural
producers. The pantry room also provides freshly made tea and lemonade, allowing employees to drink healthy
tea with no food additives. HTC cafeterias are operated by the company and the ingredients and cooking oil
used are purchased by the company and not outsourced. To safeguard the food safety and health of employees.
Besides adhering to the quality of the purchased ingredients, we also take the initiative to arrange on-site
audits for the second-tier suppliers, and require suppliers to propose deficiency improvement plans. The
supplier on-site audit items are based on the Food Good Hygienic Practice (GHP), and are divided into eleven
categories: factory environment and food operation site construction and facilities, product acceptancecheck and inspection, raw material storage management, food pre-treatment process management, logistics
and distribution control operations, inspection sites / toilets / hand washing facilities / changing rooms, andothers. A total of 14 suppliers were audited in 2019, and deficiency items have all been corrected and improved.

Food Safeguards

Healthand Safety
Management

Checklists are used to control environmental disinfection,
the dress code, waste food control, refrigeration storage
temperatures, and the use of energy. Strict audits andchecks are carried out and all activities are strictly
managed from the sorting of ingredients, to their cutting,cleaning, storage and processing.

Professional Security Service TeamAt HTC, the mission of security guards is not only to maintain security, but also to uphold a service-oriented
work attitude. With regard to the handling of and responses to all matters, they need to maintain HTC’s assets
and equipment as if they were family property, while all employees and visiting VIPs and manufacturers
should be seen as relatives and friends in order to demonstrate that it is a trustworthy and professional
security service team.
The salary of security guards must not be deducted for any cause other than their due labor insurance andNational Health Insurance (family members included). For labor insurance and National Health Insurance,
employees should be insured according to the salary level. In addition, according to the provisions of Article
8-2 Security Service Contract, pre-employment education training, three-day symposiums (36 hours), andParty A hazard notification course must be completed before being allowed to be stationed. The course content
includes security guard duty principles and special response methods, such as the pregnant women screening
procedure requiring pregnant women’s label to be checked while refraining from contacting or holding asecurity bar during the inspection. In 2019, 2 hours of training on service SOP and communication skills wereconducted for guards and their supervisors. A total of 59 people attended the training. In addition, 15-minutetraining on recent faults is implemented daily before the service.

141

Friendly Workplace

Meals are cooked upon ordering. When the meal is ready, SMS text message will be used for notification. The
dining environment is designed with floor-to-ceiling windows, designing furniture, green plants and artistic
installations to create a variety of styles for employees to enjoy and relax. On the first floor of the Taipei
Headquarter Building, there is a tea booth selling selected good tea from Lalashan. With the idea of healthy
and nutritious ingredients, carefully selected raw materials are used to provide employees with products thatare healthy and delicious. Furthermore, in response to environmental protection, the provided utensils arerecycled and cleaned for reuse. To promote waste reduction, customers bringing their own cups will receive
discount for their beverages.
In order to enrich the choice of food, the employee cafeteria in HQ & Plants and Taipei Office will organize foodtasting event every month. After food tasting, questionnaire survey will be conducted to collect feedback from
employees. Based on the survey results, adjustment will be made for improvement. The employee cafeteria
also collaborates with professional catering service providers to deliver fun activities and interesting dishes
during certain festivals, allowing the employees to enjoy the festive atmosphere.

HTC 2019 CSR Report142Drinking Water Quality Control

Taipei Office Dining Activities
Valentine’s Day Special
On Valentine’s Day (February 14th), the Juice Bar at the 9F Restaurant in the
Taipei Office introduced the Valentine’s Day Special, “Fruits Fall in Love with Ice
Cream”, which used seasonal fruits, the strawberry ice cream from Mövenpick, anda small umbrella for decoration, allowing employees to enjoy a sweet Valentine’s Day.

The drinking water quality directly affects the health of employees and drinking water management is closely
related to water quality. Therefore, it is an indispensable part of daily life. HTC has set up a comprehensive
water fountain inspection plan to ensure the standard of purity of drinking water. Regular maintenance,water sample testing, and records disclosure are done according to the Drinking Water Management Act. The
maintenance and care of the drinking fountains are carried out by a professional company and testing of water
purity is carried out by an environmental testing agency that is authorized by the EPA to take regular samples
and perform the tests every 3 months. The results of the water quality tests are published and the records arealso posted in a prominent position close to the drinking fountains. The total bacteria count of drinking waterand E. coli colonies have passed the test in 2019.

Thanksgiving Turkey Sharing
On Thanksgiving Day, HTC invites chef from the Monarch Plaza Hotel to serve huge turkeys at the Taipei
Office restaurant. In addition to turkeys, original turkey sauce or cranberry sauce were provided, together
with fresh and crispy mixed garden salad to enhance the overall flavor of the meal. The meal was provided
to employees for free, allowing them to experience the atmosphere of Thanksgiving and sharing.

Environmental Sanitation Agents
To ensure the quality of life and comfort of our employees as well as that ofnearby residents, HTC takes measures against dengue fever and carries out
pest and rodent control on a quarterly basis. Standing water pools near theplant are sprayed to reduce mosquito population density.

Environmental Expenditures
Unit: NT$ ThousandYear
Environmental expenses

2017

2018

2019

83,74542,804

41,792

Environmental Maintenance Expenditure in 2019
Unit: NT$

Christmas Alcohol-Free Drink

Category

Taipei Headquarters

Taoyuan Plant

Total

Plant cleaning

14,227,128

14,057,386

28,284,514

Restaurant cleaning

3,133,620

3,055,366

6,188,986

On December 24 (Christmas Eve), HTC invited church brothers and sisters to sing church music with
employees. In addition to experiencing the joyful
Christmas atmosphere, we also prepared alcoholfree sparkling drinks for employees to enjoy,
spending a happy Christmas Day together.

Pest disinfection

59,444

377,662

437,106

Rodent control

125,329374,250

499,579

VR Experience Activity

Carpet rental-

48,96048,960

HTC collaborated with the National Palace
Museum and the world’s top museums todemonstrate the excitement of virtual reality. In
addition to inviting employees and their families
to experience HTC’s VR technology and products,
foods were also served during the activity, allowing
employees to enjoy the meal and have fun.

Elevator ladder cleaning-

10,50010,500

Water tower cleaning-

208,000

208,000

Gardening

1,491,533

661,450

2,152,983

Cleaning supplies

1,944,648

2,017,121

3,961,769

Total Expenditure

20,981,702

20,810,695

41,792,397

143

Friendly Workplace

Note: For the expenditure of HQ & Plants, the “Plant Cleaning” item includes the rented P Building, but the rest of the items do not.

HTC 2019 CSR Report144

Employee Clinic Service
Result in 2019
Category

Valuing Employee Health
We regard the health of our employees as a key element of our success and sustainable development. In thisregard, HTC promotes various health programs with the four main directions of “Health Management”,“Health Promotion”, “Occupational Health” and “Employee Assistance Program (EAP)” to help employees
achieve a balance between work and life. Maintaining physical and mental health and ensuring the health of
every employee.
Health Enhancement Scheme for HTC Employees
Category

Actions

HealthManagement

Health center for managing and planning affairs related
to employee health.
General and outpatient rehabilitation services.
Health exam and management for staffs.
Management/tracking for abnormal HE results, Special
care and case follow-up management.
Health information webpage.

HealthPromotion

Comfortable breastfeeding rooms, Smoking cessation
promotion, Weight-loss Classes, Topic seminars, Blood
donation activity.
Influenza vaccination, Cancer screening, Infectious
disease control and treatment.
Aerobics.
CPR & AED course design.

Occupational
Health

Employee
Assistance
Program

Health Management

Person-time

Outpatient Service

1,458

Physiotherapy

1,454

General Consulting

972

Trauma Treatment

108

Occupational
Hazards and Job
Placement

29

HTC has established an “Employee Clinics.” Professional medical
counseling is available for staff and there are resident doctors in the
Non-outpatient339
clinic. There is also excellent physical therapy and health management
hours service
service. Health check services for employees cover the divisions of general
Total
4,360
medicine, family medicine, rehabilitation medicine, physiotherapy,
and radiographic screening. HTC employees are not required to paya registration fee at the employee clinic. The dependents of employees and suppliers (stationed at HTC
to provide service) can be treated at the employee clinic and enjoy the same benefits and services as HTC
employees. Offering lower registration fee comparing to other medical institutions. At the end of 2015, the
HQ & Plant’s full-time medical specialist reported to work. Through his long stay in the HQ & Plants area, hefully understood the operating conditions of the plant area and became familiar with the employees’ issues,
which provided extra protection of the plant staff’s occupational safety and health. The health center at Taipei
office provides doctor health services every Thursday and every other Friday, including occupational medicine
and family medicine divisions. There are also physicians specialized in baby-friendliness, health policy andmanagement, labor health service and health checkup and promotion.
HTC HQ & Plants’s Employee Clinics provides approximately 4,021 person-times of service and 7,274 people
attended Taipei Office Health Center in 2019. With a one-time entry fee of NT$50, the total amount of
deducted registration fees for the year 2019 was NT$685,500, which was equivalent to 1,371 persons, and thetotal deducted copayment was NT$133,250, which is equivalent to 2,665 person-times.
The Number of People Serviced in HQ & Plants Employee Clinic in 2019

Establishment and maintenance of HE Database forSpecial-Operation Staff.
First-aid training, Prevention and treatment ofoccupational injuries and illness, Workers return to work
management.

300

Mental consultations, Special counseling.
EAP promotion activities and leaflets for new employees, EAP advocacy monthly newslette

300

500

200

100

0

145

Friendly Workplace

Jan

Feb

Mar

Apr

May

Jun

Jul

Outpatient Service

140

103

Physiotherapy

133

80

General Consulting

63

Trauma Treatment
Occupational Hazards
and Job Placemen
Non-outpatient
hours service
Total

5
3

Aug

Sep

Oct

Nov

Dec

138

131

130

138

108

110

127

112

124

97

119

90

105

127

141

107

152

129

166

105

77

87

74

79

167

124

43

62

47

69

80

3

5

7

13

10

24

8

9

10

10

4

2

4

3

4

2

6

-

4

-

1

-

35

18

35

45

33

24

32

29

27

16

29

16

379

283

388

350

364

468

435

297

381

314

399

302

HTC 2019 CSR Report

146The Number of People Serviced in Taipei Office Health Center in 2019

1,000
900
800
700
600

Annual Health Check Subsidies
500

HTC provides health check subsidies to its employees in Taiwan according to job title and grade. The dependentsof the employees also have access to health checks at any of the HTC contracted medical institutions.

400
300
200
100
0

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Health Management

61

39

68

95

67

47

60

64

51

62

42

56

General Consulting

594

150

211

769

688

474

592

392

415

282

473

500

Trauma Treatment
Occupational Hazards
and Job Placemen
Health Center

65

20

26

53

34

33

66

75

41

34

37

42

-

1

1

-

-

2

2

3

4

1

1

-

46

52

56

52

21

32

23

15

33

31

62

58

Total

766

262

362

969

810

588

743

549

544

410

615

656

In 2019, HTC spent NT$ 4,096,083 on subsidized health checks for general employees in Taiwan. There were
843 benefited employees. Among them, the health check completion rate for general employees in 2019 was
91.38%, while that for manufacturing employees was 100%, 1,069 people completed the health check in 2019.
According to the results of the health check, health management and a health education and counseling service
were arranged and employees needing further attention met with a physician so that more comprehensive
health care and treatment could be arranged. We track the health of these employees on a regular basis
according to the severity of their condition, and provide them to receive more comprehensive health care. As aresult, no harm caused by overwork occurred in 2019.
HTC Health Check Regulations
Frequency
Regulations

7,274

General employees: With one-year seniority and once every two years
Article 20 and 46 of the “Occupational Safety and Health Act” (OSHA) and Articles 13-15 of
the “Labor Health Protection Regulations”
Manufacturing employees: Implemented by employee clinic

Way

The Number of People Serviced in Taipei Office in 2019 by Category

Manufacturing employees: Once every two years after arrival

General employees: Staff can have a health check in numerous hospitals cooperated with HTC.

Last check date

Manufacturing employees: Arranged by departments since July 2015
General employees: In progress

100%

4,362

90%
80%
70%
60%

The Accumulated Health checkcompletion rate of general employees
in 2019

50%

712

577

40%

526
12

54

90

173

74

49

30%
20%

Total

Bed Rest

Mental HealthCounseling

HealthCounseling

Muscle sorenessand Ache

Otolarynagology

Dermatology

Dentistry

Ophthalmology

Friendly Workplace

Obstetrics &Gynecology

General Surgery

General Medicine

HealthManagement

147

40

Motherhood
Protection

96

481

91.38%

10%
0%
Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

HTC 2019 CSR Report

Dec

148

Uncompleted Annual Health Check Tracking Mechanism

On the 11th of every month, employees are notified via email regarding
the time of health inspection. Supervisors of the first order will be
added to the copy of the letter in 3 months, and the supervisors arerequested to assist in supervision. According to the results of thehealth checkup, management at different levels will be carried out.
Employees reaching a certain degree of severity are given healthadvice and health education.

2019 Annual Health Check Abnormal Items and Number of Person

Health check follow-up
and statistics in 2019

1. Manufacturing Employees

The number of new recruits
with physical abnormalities
follow-up.

72

The number of employeeswith physical abnormalities
follow-up.

727

499 persons had abnormal health examination results. The top five abnormal items were hemoglobin 152
persons, Triglycerides 100 persons, total cholesterol 93 persons, High Blood Pressure 88 persons, and whiteblood cells 64 persons.
2019 Abnormal Items and Number of Persons for Manufacturing Employees
Person160%%
100.00

152

100%

90.00

90%

80.00

120

80%

Physical Examination Abnormal
Education Rate in 2019

70%
60%
40%

100

70.00

93

88

60.00

80

100%

50%

50.00

64

40.00

30.46
20.04

40

30%

30.00

18.64

17.64

20%

12.83

10%

0

0%
0

■ Person

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

20.00
10.00
0.00

Hemoglobin

Triglycerides

Total Cholesterol

High Blood
PressureWhite Blood
Cells

Note: This statistic includes departing employees.

2. General Employees
266 persons had abnormal health examination results. The top five abnormal items were low-density cholesterol 50
persons, total cholesterol 41 persons, triglycerides 37 persons, hemoglobin 37 persons, and occult blood 10 persons.
■ Person2019 Abnormal Items and Number of Persons for General Employees
Person%100.00

60
50

%

50

90.00
80.00

41

37

40

70.00

37

60.00
50.00

30

40.00
20

18.80
10
0

15.41

13.91

13.91

30.00

10

20.00

3.76
Low-Density
Cholesterol

Total Cholesterol

Triglycerides

Hemoglobin

10.00
0.00

Occult Blood

Note: This statistic includes departing employees.

149

Friendly Workplace

HTC 2019 CSR Report150

Health Promotion Programs

HTC Employee Clinic Facebook Page

It is a well-known fact that the pressure of a technology industry tends to cause employees to neglect theimportance of their health. HTC Employee Clinic will organize seminars and health promotion activities fromtime to time every month. The annual health promotion courses will be organized based on the previous year’s
health check abnormal items as well as the topics interested by the employees from the questionnaire survey
results. For the employees with abnormal items during health check, doctors will be arranged for follow-up
check and health education will be provided by nurses..
2019 Health Promotion Course Content and Number of Participants■ Number of Attendees

Number of Classes

Classes

https://www.facebook.com/HTC.EmployeeClinic
HTC has created a Facebook Fan Page for the employee clinic. Besides promoting health promotion
activities, information on the correct health management is provided to employees, cultivating employees’autonomous health management capabilities. As of the end of 2019, the number of fans in FB Fan Page
reached 1,022 persons.

2019 Employee Clinic Special Event

Person

4,842

120

5,000

108
100

4,500
4,000
3,500

80

3,000
60

2,500

51

2000

1,672
40

1,143
20

293
30 4

26

12

209

1,000

18

16

2

246

500

2
Total

Health Enhancing
Promotion

Exercise and Diet
Weight Loss Courses

Infectious Diseases
and Cancer
Prevention

Vision Care

Gastrointestinal
Health CourseFirst Aid Courses

Trauma Course

Quit Smoking
Courses

Human Factors
Course

0

52 2

1

1,500

1,171

0

Physical fitness enhancement activity
Since some employees have been sitting for work for a long period of time and have limited exercise,their health and physical strength may become poor, leading to abnormal results in their healthexamination report. The employee clinic conducted physical fitness enhancement activity to build ahealthy and good posture for our employees. The activity is comprised of 12 weeks of sports-related
courses, which spanned from April to June of 2019. The activity includes technical fitness test, blood
test and 20 sports introduction and field courses. A total of 34 employees completed all sports courses.
In addition, employees were also allowed to participate in individual courses, with a total of 670 people
attended the courses.
Results of physical fitness enhancement activity:
The results show that 76% of employees have a significant decrease in body fat percentage, 76% of
employees have improved cardiovascular endurance, 59% of employees have increased muscular
endurance, and 56% of employees have increased body flexibility. Employees also felt that their healthbecame better and their physical strength was greatly improved. Moreover, 62% of employees had
increased good cholesterol “high-density lipoprotein” value. Among them, the obese group (a totalof 18 people) had significant improvement as compared with the healthy (control) group (a total of 16
people), which reduces the risk of cardiovascular disease. The metabolic syndrome high-risk group in
was reduced from 4 people to 2 people.

Number of participants in health promotion courses in various regions in 2019

Taipei Office3,364 persons

HQ & Plants
Tainan Software
R&D Center

151

1,471 persons
7 persons

Friendly Workplace

HTC 2019 CSR Report1522019 Employee Clinic Special Event

HTC’s response to the COVID-19 epidemic

Cerebral and cardiovascular health promotion activity

First Stage (2020/1/31~2020/3/4)

HTC actively promote in the government's smoke-free workplace policy. Besides formulating smoke
control measures and implementing a comprehensive smoking bans in the factory area, smoking
quitting consultation service has been offered in employee clinic since May 2016 for employees withsmoking habits. Smoke-quitting treatments were conducted by professional doctors, pharmacists, andsmoking-quitting counselors, allowing the participated employees to quit smoke successfully. As of
2019, 17 employees have participated in the treatment. In 2019, a series of 26 smoke-quitting related
courses were held, with a total of 491 people attended the courses. The courses include: cerebral andcardiovascular disease lectures, cerebral and cardiovascular risk screening tests, good diet and good
health lectures, sports lectures and fresh air lectures.

1. To avoid the potential threat in the working environment that some employees may have visitedthe area with epidemic or had contact with people who has been infected with COVID-19 during the
Chinese New Year holidays, all the employees who originally planned return to work on January 31
were required to Work From Home (WFH), and not allowed to enter the office. It was also announced
that all employees entering the office, must fill in and submit the “Health Declaration Form” before
entering the office area
2. Employees must honestly declare on the Health Declaration Form their contact and travel history toapply for Work From Home：• Those who visited China, Hong Kong, and Macao must Work From Home (WFH) for 14 days; those
who have contacted people travelling from/to China, Hong Kong, and Macao must Work From
Home (WFH) for 7 days.
• All passengers who enter Taiwan through “transfer” in China, Hong Kong and Macau must Work
From Home (WFH) for 14 days.
3. Disinfection of the entire working environment was completed on January 31 (Friday) using bleachand alcohol. The disinfection will be implemented once every two weeks.
4. For the disinfection of public areas, the cleaning staff wipes the buttons and panels inside and outside
the elevator with alcohol or bleach every hour, as well as the door handles of the conference roomand the desktop of the sofa area on the first floor; the disinfection of the interior of the elevator isconducted using with hypochlorous acid every hour.
5. The dining area of the restaurant is closed. The kitchen serves meals as usual; however, lunch boxes
are served instead. Employees are asked to eat their meals at their own seating area. The collection
area for food waste and lunch boxes is temporarily located in the pantry of each building.

Eye care - eye inspection activity
Eye is the window of our soul. “It” leads you to explore this colorful world and shows you the beautyof life. However, people nowadays are under a lot of stress and 3C (computer, communication andconsumer electronics) products have become indispensable part of their life, placing a great burden
on their eyes. The latest research found that as vision deteriorates, memory and mobility also decline,
accompanied by dementia and depression. Let us understand and protect our eyes, restoring our visionand brain power to youth. For this event, we invited the Universal Eye Center to provide quality eye
inspection for our employees. The HTC Employee Welfare Committee provided subsidy for each eye
inspection (up to NT$ 1,500). Employees can receive free corneal slit lamp examination, fundus retinal
tomography, and dry eye screening.
The total of 1,672 people attended the activity. Among them, 77
people required further health consultation.

153

Friendly Workplace

Second Stage (2020/3/5~)
1. All employees must pass the temperature test when entering the building. Masks must be worn
throughout the day, especially during meetings and close-distance discussions.
2. Everyone must complete the “Voluntary Health Management Feedback” on the computer or mobile
phone every day.
3. In case the epidemic continues to expand to affect our entire life, drills were conducted according
to the “Guidelines for Enterprises to Continue Operation in Response to the COVID-19 Epidemic”
issued by the Central Epidemic Command Center, to prepare the scenario that employees are unable
to take transportation or cannot enter the office to work.
4. After the WFH exercise, 50% WFH was officially implemented depending on the situation of theepidemic, reducing the opportunity for group work as well as the density of personnel in the office.
5. Employees who return to Taiwan from abroad, regardless of the country or region, must stay home
for quarantine and Work From Home (WFH) for 14 days; within the 14 days, please do not enter theoffice or meet with colleagues. Use video conference for meetings.
6. Employees who have been in contact with family, relatives and friends traveling to and from the above
areas must Work From Home (WFH) for 7 days.
7. Strengthen the protection against mild symptoms. Those who have fever or respiratory symptoms
must Work From Home (WFH) for 7 days; to avoid seasonal flu or other diseases to spread during thisepidemic, which puts more burden on the medical resources, regardless of whether there is any contact
or travel history, anyone who has fever or respiratory symptoms must Work From Home (WFH) for 7days, and inform the employee clinic as well as the corresponding department supervisor immediately.

HTC 2019 CSR Report154(1) Preventive measures against health-endangering heavy workloads

Occupational Health
1. Specific Health Check

In 2019, the work environment at the HTC Taoyuan Plant is carefully tested and monitored. The special
health hazardous operations such as those involving ionizing radiation, dust and MDI must receive a thoroughhealth checkup. The total number of employees required for special health examination was 60 people. In
addition, according to the regulation that “Employer Shall Provide Certain Items of Health Examination
to Its Employee Designate for Long-Term Night Work” issued by the Ministry of Labor on January 5, 2018,
employees who are engaged in night work were arranged to complete their specific health examination. The
number of people to be inspected was 267 and the inspection completion rate reached 100%. The inspection
results showed that the number of employees qualified for the first-level management of special health checkup was 33 people, and the number of employees qualified for the second-level management of special healthcheck up was 27 people. According to the “Labor Health Protection Regulations”, the 27 employees qualified
for the second-level management and the 87 employees with abnormal results from night work healthexamination were asked to visit to the employee clinic individually, and health consultation service was offeredby doctors, providing them personal health guidance and strengthening their disease and health related
knowledge. The follow-up environmental inspection and cause review were completed to continue monitoring
the health of our employees.
2. Emerging Health Issuess

HTC’s employee clinic,
environmental safety department,
human resources division, andother undertaking units planed theProtection Program in four themes,
which was implemented gradually
since 2016.

Topic

Organizer

Overload and Health Hazard Operation Prevention

Employee Clinic

Maternal Health Protection Plan

Employee Clinic

Ergonomics Hazard Prevention

OSH Department

Execution Infringement Prevention

HR Department

According to related regulations, employers have the obligation to plan and take the necessary safety andhealth measures for employees taking rotational shifts, night shifts or who work for long hours, in case
medical conditions might occur which are related to an unusually heavy workload. Appointments are madewith medical doctors, or health consultants for employees should a medical check find them to have a healthproblem. A change of work or the adjustment of working hours is usually recommended. In 2019 screening
and notification, 34 risky employees were interviewed by doctors. There was no incident of injury caused byoverload in 2019.
Preventive Measures Against Health-endangering Heavy Workloads

Identify
and Assess

Identify and assess the high-risk group
via the analysis of health check

HQ & Plants health centercounseling service
Taipei office on-site health service

HealthManagement

Health education and counseling service
will be arranged for employees withphysical abnormalities and a change ofwork or the adjustment of working hours
is also recommended.

The number of employees (new recruits 		
& IDL) with physical abnormalities (Taipei
office)The number of new recruits with health check
The number of employees (IDL) withphysical abnormalities follow-up

Set UpPreventive Plan

Make preventive measures against
health-endangering heavy workloads

Effectiveness
Assessment

Assess the effectiveness of plan andmake improvement plan

Number of injuries due to fatigue■ Number of risky employees

Employees with Overload Risk Management in 2019

■ Number of notification

12 12

6 6
2 2
Jan

155

Friendly Workplace

3 3
1 1
Feb

Mar

1 1

1 1

1 1

Apr

May

Jun

Jul

2 2
Aug

Sep

2 2

2 2

Oct

Nov

1 1

HTC 2019 CSR Report

Dec

156

(2) Maternal Health Protection Plan

2019 Maternal Health Protection Plan Risk Level and Numbers of Employee

When safety and health hazard factors exist in the workplace, there may be adverse effects on pregnancy
and breastfeeding. When female employees’ presence in the workplace is indispensable, the importance ofthe protection of maternal health is highlighted. HTC has since June 2016 launched the Motherhood HealthProtection Program, which includes all female employees one year after childbirth or breastfeeding womenas protected subjects. In accordance with the Program, the list survey, risk identification, individual medical
consultations, work assignment and work/ return to work, and other procedures were carried out. By the end of
2019, 63 employees completed the risk classification and protective measures, indicating the considerably safe
work enjoyment and contents. Female worker maternal health risk assessment and its processes are as follows：

Risk Level 1
80
75

Risk Level 2

79

73

64

65

62

59

61

63

58

57

Maternal Health Risk Assessment and Process① Workplace Risk Assessment

Evaluate workplace health and safety risk factors(Evaluation subjects include: Women who are pregnant, within 6 months after delivery (including stillbirth after
24 weeks of pregnancy), and breastfeeding)Yes② Hazard Control

Any health and safety
risk factors

No③ Risk Communication

Perform evaluation on whether it is possible to reduceor remove risk factors, or pregnant/ maternal womenreported that can’t handle their original job andapplied for job adjustment due to health problem.

Inform employees of any of risk factors; employees
need to understand the importance of notifying theiremployer as early as possible about pregnancy, having
given birth or breastfeeding in the last six months, andshould be re-evaluated when health conditions, duties,
or working conditions change.

1

1

2

3

Jan

Feb

Mar

Apr

1

1

May

Jun

0

0

0

0

0

0

Jul

Aug

Sep

Oct

Nov

Dec

Note: Risk level 1: Evaluated by the doctor as harmless to the mother, fetus, or infant.
Risk level 2: Evaluated by the doctor as possibly harmful to the mother, fetus, or infant.
Risk level 3: Evaluated by the doctor as harmful the mother, fetus, or infant.

④ Work Adjustment

Action 1: Temporarily adjust working conditions (such as adjusting work volume) and working hours or
Action 2: Provide suitable alternatives with equal pay and benefits
Action 3: Provide paid leave or extend paid maternity leave to avoid affecting the health of the motherand the child⑤ Risk Communication and Adjustment Report

1. Inform employees, their supervisors and human resources department.
2. The on-site medical staffs continue to provide health guidance, education and training, and healthprotection measures.

⑥ Performance Evaluation and Review

1. Performance evaluation includes the participation rate of the maternal health risk assessment, and thecompletion rate of relevant measures such as hazard control and work adjustment.
2. Occupational Safety and Health Committee should regularly review the implementation result and theeffectiveness.

157

Friendly Workplace

HTC 2019 CSR Report158

Positively Preventing Occupational Accidents
HTC has identified the prevention of occupational accidents as a top priority of facility management. By
following the “Occupational Accident Prevention and Self-Inspection Plan”, we prevent occupational
accidents and perform self-inspection to achieve our zero-accident goal.

Employee Assistance Program (EAP)HTC has been working with the Hsinchu Lifeline Association since February 2009 to provide employees withpsychological counseling and guidance with respect to working career, relationships, family and parenting,gender sentiments, mental illness, and physical and mental stress. Each year, employees can enjoy unlimited
telephone consultations and 6 free face-to-face consultation services, which are paid in full by the company. In
2019, a total of 661 employees used the telephone consultation services. The analysis and recommendation on
employee consultation topics are reported regularly to the Occupational Safety and Health Committee.
The number of people using EAP in 2019 has increased significantly as compared to that in 2018, indicatingthat most employees accept and are willing to use this service, and the satisfaction after using the service isquite high. It is suggested that the current promotion model, channels, and professional services can be kept tomaintain the well-being of employees. The recommended evaluation criteria are as follows:
1. Stabilize labor productivity and reduce the absence and turnover rate of employees.
2. Prevent the occurrence of employees’ deviated behavior (such as suicide), effectively reduce the problem
handling cost.
3. Improve management efficiency and assist newcomers to adapt to work and environment.
4. Improve employees’ work enthusiasm and initiative to activate the working atmosphere in the office.
5. Promote the physical and mental health of employees, and strengthen their cohesiveness and sense ofidentification with the organization.
6. Improve employees’ emotional stability and work efficiency.

Our work covered seven aspects: “Management of Safety and Health”, “Education and Training for Safety
and Health”, “Standard Operating Procedures and Job Safety Analysis”, “Inspections for Safety and Health”,“Emergency Response”, “Health Management and Enhancing” and “Safety and Health Campaign” for thecomprehensive prevention of occupational accidents.
The hazard identification in 2019 is Class 3 and Class 4, which are low-risk. The types of injuries with higher
severity are falling, electric shock, and confined-space operations. The current control methods include
implementing checkpoints before/during/after operations, education and training, and promotion.
In the event of an occupational injury, our notification procedure is as follows:
Traffic accidents outside the factory area
Notify●Immediately notify
the supervisor or
the foreman

Notify
●

2017

2018

2019

Number of Telephone Counseling (Free)

141

351

532

Number of Interviews

130

91

129

Hours of Interviews

140

100

132

Number of Interviews (Male)

44

38

52

Number of Interviews (Female)

86

53

77

Number of Interviews (Manufacturing employees)

6

2

10

125

89

119

566,400

460,000

549,600

159

Friendly Workplace●●

Record●Injury treatment
Proof of diagnosis

Go to a hospital●

Immediately notify
the supervisor or theforeman

Prepare theoccupational injury
investigation andanalysis report●

Injury treatment
Proof of diagnosis

Record●Prepare the occupational injury
investigation and analysis report● Carry out improvement based on
the hazard factor

AspectMeasureManagement of Safety
and HealthIf there is any change in the organization or addition of new business units,
this has to be reported to the authorities concerned. Such information ranges
from hazard statistics, hazard investigation analysis, meetings convened by thecompany occupational safety and health committee, preventive inspections, andthe management of the entry of contractors into plants.

Education and Training
for Safety and Health

Provide occupational safety and health-related courses on a regular basis.

Standard Operating
Procedures and Job
Safety Analysis

Set up rules and procedures for operation, maintenance, and work safety. Amend
rules for workplace safety and health, general knowledge of dangerous materials,
and the assessment of risk.

Inspections for Safety
and HealthAll kinds of working environments, cars, equipment, facilities, and fire safety systems
should undergo regular inspection. The items to be checked include organic solventsin working environments, ionizing radiation exposure, and infrared detection.

Emergency Response

Implement an emergency response plan for the year and launch emergency
response drills.

Health Management andEnhancing

Purchase medical consumables and provide health checks or checks for special
health problems specific to both new employees and those already on the job.
Track and manage those with unusual results.

Safety and HealthCampaign

We have done everything legally required in response to all government
regulations. We also participate in all kinds of relevant meetings and publish
promotional posters, comics, and slogans. We constantly update information andcommunicate with employees over workplace safety. All these efforts are aimed at
improving work efficiency.

Employee Assistance Program (EAP) Results

Invested expense (NT$)

Call the police to filethe case● Triplicate form ofcase report

Go to a hospital

Accidents in the factory area

Appointment Hours: Monday ~ Friday 9 am ~ 7 pm
Reservation Tel: Mobile: 035-260415

Number of Interviews (General employees)

Call the police●

HTC 2019 CSR Report1602019 Full-time Environmental Safety and Health Personnel Training

Comprehensive Emergency Rescue Measures

2019 (Re) training for Certificate Training Completion Rate

1. Organic solvent operation manager training x1 trainee
2. Specific chemical operation manager initial training x2 trainees
3. Organic solvent operation manager initial training x4 trainees

Q1

Q2

100%
Completed100%

1. Fire protection personnel retraining x1 trainee

Completed

A 24-hour emergency rescue Hot Line has been set up as part ofa fully comprehensive emergency notification system.
Sufficient rescue personnel have been lawfully designated andemergency rescue personnel training courses are held annually.
17 Automated External Defibrillators (AED) are available at
specific places within the company.
Emergency evacuation drills are carried out periodically.
Since 2010, CPR seminars are held regularly each year
These related measures have been effectively carried out at HTC.
In 2019, most occupational injuries were the result of traffic accidents, with 21 cases in the HQ & Plants and2 cases in the Taipei Office. There were 4 injury cases that occurred within the HQ & Plants and there was noaccidents in the Taipei Office. Falls are the most frequently reported incident (2 cases), with 3 days of labor
lost. In 2019, the average employee injury frequency rate (FR) of HTC employees was 0.91 person-times/
million man-hours for the HQ & Plants, and 0 for the Taipei Office. The average injury severity rate (SR) of
HTC employees was 4.56 days/per million hours for the HQ & Plants, and 0 for the Taipei Office.
We will promote safety education for employees who commute to and from work in the future and will also
provide them with work safety concepts and necessary training. Warning signs are to be placed in conspicuous
places to reduce the incidence of accidents.

1. Organic solvent operation manager training x1 trainee
2. Stacker operator (>1 ton) initial training x1 trainee
3. Roof work operation manager initial training x1 trainee
4. Organic solvent operation manager initial training x1 trainee
5. Radiation operator training (18 hours) x3 trainees

Q3

100%

Average FR & SR in Taiwan Plant in 2019

Completed

TargetAverage Injury
Frequency Rate
(FR)

Q4

100%

1. Stacker operator (>1 ton) initial training x2 trainees

Completed

License type

Hour

Total

Organic solvent operation manager initial training

5

18

90

Organic solvent operation manager initial training

2

6

12

Fire protection personnel retraining

1

8

8

Roof work operation manager initial training

1

18

Specific chemical operation manager initial training

2

Stacker operator (>1 ton) initial training
Radiation operator training (18 hours)

Friendly Workplace

ResultResult(QH & Plant) (Taipei Office)

0.3
1.8

0.91

0

4.56

0

Note:
1. Average Injury Frequency Rate, FR＝person/total time of work*million hours worked.
2. Average Injury Severity Rate, SR＝days/ total time of work *million hours worked.
3. Occupational injuries statistics does not include light damages of less than one day ofloss, excluding traffic accidents.

Person161

Average Injury
Severity Rate(SR)

Absence rate (AR)Total hours absent / total hours worked x 200,000*

Year

2019

Taiwan1

HQ& plant(male)

1.06

HQ& plant(female)

2.18

Taipei Offices(male)

0.29

Taipei Offices(female)

0.67

Note: In 2019, the number of days of absenteeism is calculated as the number of days ofabsenteeism due to incapacity for any reason, not limited to work-related injuries
or illnesses but excluding approved holidays, such as: festive holidays, training,maternity leave, paternity leave and funeral false.

Injury Frequency Rate (FR)Injury Severity Rate (SR)

Injury Frequency Rate per Million Hours Worked

Lost Day Injury Frequency Rate per Million Hours Worked

Year

2017

2018

2019

Year

2017

2018

2019

18

HQ& plant

0.61

0.83

0.91

HQ& plant

10.89

7.53

4.56

18

36

Taipei offices

0

0

0

0

0

0

4

18

72

Management Target

0.30

0.3

0.30

1.80

1.8

1.80

3

18

54

Note: Injury Frequency Rate = Incidence of Lost-Time Injury×1,000,000/total hours
worked.

Taipei Offices
Management Target

Note: Injury Severity Rate=Days Lost for Lost-Time Injury×1,000,000/Total Hours Worked.

HTC 2019 CSR Report162

Occupational Injury Death Rate

Occupational injury
in Taiwan Plant in 2019
The main types of occupational injuries in HTC plantand for contractors include falling over, clamping,colliding, cutting, etc. Among them, clamping is an
occupational hazard that causes serious occupational
injury. When occupational injuries occur, should
shut down machines immediately and perform
simple remediation. Operators should be advised
to pay attention to the conditions of the machine/
equipment to minimize the risk. The following data
calculation covers all workers.

Number of occupational injury death / working hours (total hours
worked) x 1,000,000

Year

2017

2018

2019

HQ& plant000

Taipei Offices

0

0

0

Contractor and Supplier of
HQ & plants

0

0

0

Contractor and Supplier ofTaipei Offices

0

0

0

Note: 1,000,000 refers to the ratio of every 500 employees based on 50 weeks per year and40 working hours per week.

Severity Occupational Injury Rate(excluding deaths)

Recordable Occupational Injury Rate

Number of serious occupational injuries (excluding deaths)/
working hours (total hours worked) x 1,000,000

Recordable number of occupational injuries/working hours x
1,000,000

Year

2017

2018

2019

HQ& plant00

Taipei Offices0

Contractor and Supplier of
HQ & plants
Contractor and Supplier ofTaipei Offices

Year

2017

2018

2019

0

HQ& plant

4.88

5.45

3.19

0

0

Taipei Offices

0

0

0

0

0

0

Contractor and Supplier of
HQ & plants

0

0

0

0

0

0

Contractor and Supplier ofTaipei Offices

0

0

0

Note: 1,000,000 refers to the ratio of every 500 employees based on 50 weeks per year and40 working hours per week.

Note: 1. 1,000,000 refers to the ratio of every 500 employees based on 50 weeks per year
and 40 working hours per week.
2. Occupational injuries that can be recorded are accidents in the plant, minor
injuries in the factory, and traffic accidents.

Contractor Management
HTC attaches great importance to the safety of contractors. Each year, according to the status of contractor
safety and health management, a complete occupational safety and health management plan is drawn up toprevent and prevent occupational disasters. In addition, HTC has passed the OHSAS18001: 2007 version of
the Occupational Health and Safety Management System. It is expected to be converted to ISO 45001 in 2020.
Newly recruited construction workers receive safety and health education before they start on their jobs. They
are given all necessary information about the working environment and the relevant safety regulations. They
all know the location of fire-fighting facilities and how to use it.
The Second Item of the HTC Environmental, Safety and Health Policy states that “We regard the safety andhealth of employees, customers, suppliers and contractors as equally important”. During the operation of thecontractor, project officer will be at the site. If there is an accident, the project officer can call 831919 to ask
the medical staff to perform treatment at the site or take the injured contractor to HTC employee clinic fortreatment. As long as the injury is due to work, whether it is small or severe, the notification must be completed
and recorded. In the case of severe injury, an accident investigation will be conducted to examine and analyze
the cause of the incident, and correction or improvement is required for the site.

Measureof Contractor
Construction
Management

Contractors
Healthand
Safety Audit

		The provision of site safety induction
sessions at construction sites.

Incorporating requirements for safety & healthmanagement in the written agreements with allcontractors according to the applicable regulations toclearly define contractor obligation and responsibility,and evaluate all the risks in the working environment
including that from dangerous machines, so as to haveproactive control and eliminate potential hazards.

		Verifying the information about
construction workers and vendors.
		Monitoring high-risk operations.
		Personnel access control.

Recordable Occupational Disease Rate

Occupational Disease Death Rate
Number of deaths due to occupational diseases / working hours x/ 1,000,000

Year

2017

2018

2019

HQ& plant

0

0

0

0

Taipei Offices

0

0

0

0

Contractor and Supplier of
HQ & plants

0

0

0

0

Contractor and Supplier ofTaipei Offices

0

0

0

2017

2018

2019

HQ& plant000

Taipei Offices00Contractor and Supplier of
HQ & plants

00Contractor and Supplier ofTaipei Offices

0

0

Year

Note: The total number of employees is calculated based on the total number of employees
on December 31, 2019.

163

Friendly Workplace

		Ensuring construction site safety.
		Conducting safety and healthmanagement for new facility
construction.
		Obtaining the required insurance forcontractor employees.

Formulating a system for on-site patrols and inspections
according to the applicable regulations and contractual
requirements about labor safety & health. On-site
inspections and audits are conducted on a regular/
irregular basis., working precaution, records of thesafety & health education of the workers, and all safety
requirements to be met before, during and after the useof machines, tools and equipment.

* Note: 1. The total number of male working days in head HQ & Plants is 189,243 days, and the total working hours are 1,751,798.91 hours in 2019.
2. In 2019, the total number of female working days in the HQ and Plant was 275,565, and the total working hours were 2,635,456.39 hours.
3. In 2019, the total number of male working days in the Taipei office was 495,277 days and the total working hours were 4,348,543.84 hours.
4. In 2019, the total number of working days for women in the Taipei office was 386,232 and the total working hours were 3,611,211.04 hours.
5. 	Work-related injury rate=total number of work-related injuries/total working hours×200,000 (based on 50 weeks per year, 40 working hours per week, rate per 100 employees)
6. 	The contractor’s occupational disaster statistics standard is the same as that of ordinary employees, excluding minor injuries with a loss of less than 1 day, and excluding
traffic accidents.
7. 	Since 2016, the company’s contractors have not had any accidents, so the total working hours of the contractors in 2019 are not included in the statistics.

HTC 2019 CSR Report164Social Investment
and Contribution ___HTC has long been committed to the social careand public welfare, and supports and sponsors
the “HTC Education Foundation” and the“HTC Social Welfare and Charity Foundation.”
HTC advocates humanitarianism and we havedeveloped our company character culture at a
local level. While we continue to pursue businessgrowth and technical innovation, we care verymuch about disadvantaged families, and give
their children opportunities to receive theeducation. This is a distinctive corporate cultureof which HTC is rightfully proud.
In the meanwhile, HTC also utilizes the industry
characteristic and helps society create more
possibility by R&D and innovation. We havedevoted to inventing novel products not onlywith the target of being in accordance with
Sustainable Development Goals (SDGs) issued
by UN in 2015 but also with the aim of meeting v
kinds of needs in the society and implementingsocial care to actively practice CSR.

HTC Foundation
The HTC Foundation focuses on promoting character education by working to help children and youngsters
develop good character by supporting both schools and teachers. We place great importance upon building
up moral character and culture for communities and towns in cooperation with local government, care fordisadvantaged families, providing their children with opportunities to receive education, and raising funds forenvironmental and ecological preservation.
We engage in public interest activities to espouse humanitarianism and contribute to a peaceful andharmonious society. The Foundation plays an important part in community engagement and social services
to instill the core values of integrity, honesty, care, love, positive thinking, and respect for natural resources.
The HTC Foundation invested NT$ 16 million on education in 2019, while HTC Social Welfare and Charity
Foundation spent NT$ 41 million on charity business.

VisionEveryone has a good personality. People respect and support each other. Let us make theplanet lovely together.

MissionOur mission is to instill core values of integrity, honesty, care, love, positive thinking, andrespect for natural resources by untiring efforts to educate.

Objectives
1. To encourage the development of good campus culture by influential education projects andthe continuous and systematic encouragement of teachers, parents, and students.
2. To encourage the development of good urban character culture by influential education
projects and urging local communities to work towards this end.
3. Care for disadvantaged families and the provision of educational opportunities for young
people to give them the knowledge and character that allow them to become contributive
members of the society.

Character Statement
1. To actively and enthusiastically influence others with honesty and good character in both
personal and professional life and to set a good example with our own conduct;
2. To protect the environment and to develop a cultural and aesthetic disposition throughreadings; and3. To be a world citizen, to make reasonable efforts to help the poor and the disadvantaged in
the world, and to encourage people to respect and support one another.
We hope through these actions, people can jointly internalize the core values of integrity,honesty, love, mutual respect, caring for one another, and positive thinking.

167

Social Investment and Contribution

HTC 2019 CSR Report168Many Blessings Courses
The HTC Education Foundation is committed to the development of character education for young
people. It hopes to shape character through joint efforts by schools, parents, and society. Following theprinciple of “lighting a candle rather than cursing the darkness,” the foundation has established the“Many Blessings Course” for junior and senior high school students. These free courses each last for five
weeks. They include three hours of training and activity per week. The students get the energy to move
forward and make changes inspired by their instructors and volunteers, They are encouraged to become
leaders who can actively serve the public and use their own power to change the world.

Summer institute for character education
HTC Foundation has been dedicated to the implementation of character education. For many years, it
has been providing high-quality, systematic, and diverse resources for education and training throughthe “rock education implementation program” to help schools across Taiwan to implement character
education more effectively. To help schools cultivate a character-based campus culture, nurture thoseschool practicing character education, promote academic and practical dialogue for the character
education to strengthen the ability of the schools’ leadership teams in implementation, the foundation
has been inviting Dr. Marvin Berkowitz, lecturing professor on character education from Collegeof Education, the University of Missouri at St. Louis, to give a lecture in the “Summer Institute for
Character Education” in Taiwan since 2012. As of 2019, there have been 287 people in total from theleadership teams made up of school principals and administration members from 47 schools who haveparticipated in the five-day intensive immersion training. There are five different campus schools in
2017-2019 from Bina Bangsa School in Indonesia.
This course has been taught in Missouri and other areas for 20 years. According to feedback from the
27 schools that participated in the last 5 years after the course, the course has been beneficial to boththe participating teams and their members in core topics of the character education and nature of
education or buildup of consensus for the leadership team. HTC Foundation will continue to hold thistraining course through its summer institute. It hopes that this course would help schools build up theirown leadership teams for the character education on their campuses. Through collective efforts by theteam members, the campus-based culture of character would be shaped to cultivate students’ growthand development in characters.

Other Social Engagement Activities
In addition to sponsoring the social work upheld by the HTC Foundation, HTC also positively engages inpublic interest activities through other channels. In 2019, our accomplishments in social works included:International and domestic social welfare and sponsorship actions, combining business development andbrand value.

VIVE Original
VIVE Originals is the original content brand of HTC VIVE virtual reality (VR). We believe in the vision ofvirtual reality “VIVE Reality”. “VIVE Reality” is the sum of virtual reality (VR), augmented reality (AR), 5G,
and artificial intelligence (AI). In the future, it will create a better life for mankind across every industry inevery aspect of daily life.
In order to accelerate the realization of the “VIVE Reality” ecosystem, besides collaborating with thousandsof content developers around the world, HTC also established a Virtual Reality Content Center in 2016,
announcing the launch of the VIVE Originals original brand. Starting from the core team of the panentertainment industry, we are fully committed to the development, production and distribution of originalcontent and native IP in virtual reality.

Character Town
HTC foundation not only launches character education in schools but also signs “Character Town” withvarious towns in Taiwan. Character Learning Course is launched every month with a way of characterand setting a good example with our own conduct. Group discussion and experience sharing withdifferent themes and related to work will be arranged timely.
Participants include township police station public hospital fire department land office & household
registration office-affiliated institutes.
Parts of institutes turn into membership in the character association. Leaders in the institutes
encourage good deed via communication and integration of thoughts, which becomes the internal
operating mechanism.
“Character First” course emphasizes the concept definition and operational definition with the corevalue of nurturing the leader and team work. Besides, it is believed that people can lead in different
kinds of situation. The main goal of these courses is to nurture groups of the cadre of basic level
equipped with ethics and integrity.

169

Social Investment and Contribution

HTC 2019 CSR Report170

Establishment of the “Taiwan Virtual Content Film & Television Base”
HTC VIVE Originals was established in 2017. We learned that Taiwan is a unique place that canhave both superior IP and advanced technology; however, it lacks the role of hardware and software
integration such as the Korean Creative Content Agency (KOCCA) or the Hengdian World Studio.
HTC hopes to use its advantages in the VR business to lead various technology and cultural industries,
creating a virtual content film and television ecosystem. This ecosystem is different from the ecosystems
that have been developed so far. We are aware that if we were to compete in the existing ecosystem, we
can only be a good replicator. However, judging from the current film and television situation in Taiwan,
it is even more important to have the first standardizer to open up the new blue ocean. The first task
is to promote the project of the “Taiwan Virtual Content Film & Television Base” that integrates local
culture and technology companies. The project is mainly carried out from three aspects：
Academic Resources (People): introduction of
supply chain (MIX type), talent supply chain,knowledge supply chain
Technology Development/Connection (HighTechnology): technology chain connection(international technology/local manufacturers,
National Center for High-Performance
Computing)Business Integration (Production & Publish): R& D/commercialization/technology transfer ofcontent

PeopleGoing international: VIVE Originals’ original works
were nominated twice for the Venice Film Festival“The Deserted” produced by VIVE Originals and directed by Ming-Liang Tsai was nominated for the74th Venice Film Festival in 2017. In 2019, five more VR original works from VIVE Originals, namely“INORI”, “5×1-O”, “5×1-Only the Mountain Remains”, “Gloomy Eyes”, “5×1-The Making Of”, were
nominated for the VR Competition of the 76th Venice Film Festival. The VR interactive art “INORI”
was designated as the first representative to set foot on the red carpet among the 39 works nominatedand selected for the VR competition. In addition, “INORI” was also the first work to be shown in the VR
screening exhibition area.
In addition to the iconic Venice Film Festival, VIVE Originals’ original works were also invited toparticipate in internationally renowned film festivals, including the South by Southwest Film Festival(SXSW), the Tribeca Film Festival, the Sundance Film Festival, the Geneva International Film Festival,
the International Film Festival Rotterdam, etc., with outstanding achievements.
The 74th Venice Film Festival in 2017
HTC extended its territory to the production of virtual reality content and gained international
attention from the Venice Film Festival.

IP
CultureFutureProducts & Publish

High Technology

Establishment of the“Cultural Digital Bank-Collection and Application”
In the project of the “Taiwan Virtual Content Film & Television Base”, one of the social missions is topreserve cultural record. In addition to popular content, culture has some forms of performance thatare less noticeable or difficult to record. With the passage of time, they may be “Lost” or “Damaged”.
Even if they were not lost, they are not the same as the original piece created by the Master. Therefore,
we believe that it is extremely important to preserve the soft assets of traditional culture. For thisproject, HTC collaborated with Li-Hua Yang, a national treasure-class Taiwanese opera artist. New
technologies such as “motion capture”, “puppet construction”, “scene scanning”, and “VR360 shooting”
were adopted to make traditional culture sustainable and everlasting.

171

Social Investment and Contribution

From the left, the famous director Ming-Liang Tsai, the internationally renowned musician Ryuichi Sakamoto and the General
Manager of HTC VIVE Originals Si-Ming Liu.

HTC 2019 CSR Report172

Going international: VIVE Originals’ original works
were nominated twice for the Venice Film Festival
The 76th Venice Film Festival in 2019
Five VR original works of HTC VIVE ORIGINALS, setting foot on the red carpet of the 76th Venice
Film Festival.

From the left of the first photo, director Midi Zhao, musician
Kay Huang, HTC VIVE ORIGINALS General Manager Si-Ming
Liu, Japanese contemporary artist Miwa Komatsu, director
Wei-Liang Zeng, actor Jack Yao.

From the left is Taiwan’s representative in Italy (Ufficio di
Rappresentanza di Taipei in Italia) Sing-Ying Lee, Chairwomanof the Taiwan Creative Content Agency Xiao-Jing Ding, and
HTC VIVE Originals General Manager Si-Ming Liu, attending
the “Taiwan VR Content International Meeting” held in Veniceon the 30th.

Endodrome - 2019 Venice Biennale
Endodrome is the first VR artwork created by Dominique
Gonzalez-Foerster, a well-known French contemporary
avant-garde artist, and assisted by VIVE Arts. The
production team included Lucid Realities who is
responsible for production coordination, and VR studio
Novelab. The artwork was invited to debut in the main
exhibition of the “58th Venice International Art Biennale”
in 2019. The Biennale was curated by Ralph Rugoff, withMay You Live in Interesting Times as the theme. The
exhibition period was from May 11 to November 24, 2019,
and the venue was the main exhibition hall of the Arsenale
Biennale. This exhibition displayed a large number of art
works that are created through digital technology, showing the mainstream of art, and the recognitionof contemporary art works that are created through digital media such as VR, AR, AI.
Gonzalez-Foerster, who has repeatedly made breakthroughs in his creative technique, used virtual
reality for the first time as the medium for his work, Endodrome, as natural as the flow of water. The
title of his work “Endo” comes from the Greek word “endon”, which means “inner”, and “drome” comesfrom the Greek word “dromos”, which means “running, track.” Through the work Endodrome, theartist continues his exploration of space, inner mind and another level of consciousness. Endodrome
utilized a stage environment involving five people at a time. It was presented in a séance-like drama
scene, which includes sound, light and shadow, and screen projection from a VR head-mounted display,
combined with interactive VR experience. At the beginning of the 8-minute VR art work, the audience
will be immersed in a liquid, hypnotic monochrome environment, and gradually move in an abstract
visual space into a layer of bright color gamut that interact with their sight and breath.

Japanese artist Miwa Komatsu performs live painting show in Venice.

173

Social Investment and Contribution

HTC 2019 CSR Report174T. Rex: Skeleton Crew - American Museum of Natural History

To the Moon - 2019 Art Basel Hong Kong

“T. Rex: Skeleton Crew” is the first interactive multiplayer virtual reality
experience launched jointly by the American Museum of Natural History and
HTC VIVE Arts. The experience is part of the T-rex: The Ultimate Predator
exhibition at the American Museum of Natural History. This exhibition
presents the latest scientific research on the remarkable abilities of famous
dinosaurs and the life history of their ancient relatives. The home edition of
the “T. Rex: Skeleton Crew” can be downloaded through VIVEPORT, which
provides games in both Chinese and English. This home edition also contains
a wide range of information, including audiovisual guides from the exhibition
curator and leading paleontologist Dr. Mark Norell.

HTC VIVE has once again become the official virtual reality partner of the Art Basel Hong Kong, andwill exhibit for the first time in Asia the VR work, “To the Moon”, which was created by the GrammyMusic Award winner Laurie Anderson and Taiwan New Media artist Xin-Jian Huang.

In the Museum's exhibition, the “T. Rex: Skeleton Crew”, visitors are taken to the Saurischian
Dinosaur Exhibition of the American Museum of Natural History, inviting 3 people in a group to build
a Tyrannosaurus Rex (T. Rex) skeleton from bones. Through specimens and the latest researches, thisvirtual skeleton is by far the most accurate 3D model of a T. Rex skeleton. Once completed, the legendary
dinosaur will come to life and visitors will arrive at the T. Rex Habitat in Hells Creek Montana, UnitedStates, 66 million years ago. For users who experience the single-player home edition, the journey also
provides the opportunity for new experience, including historical facts, museum archive videos, andanimations. They will reveal the answers to the questions, including “How fast does Tyrannosaurus Rex
run?” and “What happens when they lose teeth?”

The creation, “To the Moon”, takes the audience into outer space and explores the moon in a virtual
reality world that feels real, commemorating the 50th anniversary of the landing of the moon for
mankind in 2018. In the 15-minute virtual reality experience, the audience will be transformed into
astronauts, walking and flying on the low-gravity moon surface, bringing the audience a new perspectivefrom the commanding height of outer space.
Prior to this, the installation art, “La Camera Insabbiata”, created by Laurie Anderson and Xin-Jian
Huang has won the “Best VR Experience” award at the 2017 Venice Film Festival. This exhibition of“To the Moon” is the debut in Asia, following its first appearance at the Louisiana Museum of Modern
Art in 2018, allowing people to experience this unique VR installation art in Hong Kong. This work will
be exhibited in the HTC VIVE booth at Level 3 Concourse of Hong Kong Convention and Exhibition
Center from March 29 to 31, 2019.

In order to create the “T. Rex: Skeleton Crew”, the scientific visualization team of the American Museumof Natural History worked closely with scientists to ensure that the details, including the physiologicalstructure and movement, of dinosaurs accurately reflected the latest research results. This unprecedented
virtual reality experience is part of the 150th anniversary celebration of the American Museum of Natural
History; the celebration also includes a series of cross-year events, programs, and exhibitions.

175

Social Investment and Contribution

HTC 2019 CSR Report176

Mona Lisa - Beyond the Glass Musée du Louvre“Mona Lisa – Beyond the Glass” uses virtual
reality technology to reinterpret the most
famous painting “Mona Lisa” by Leonardo Da
Vinci (1452-1519). To commemorate the 500th
anniversary of the death of Da Vinci in France,
the Musée du Louvre in Paris organized aretrospective exhibition of “Leonardo Da
Vinci”, and the “Mona Lisa – Beyond the
Glass” is the first work that uses virtual
reality technology in the Musée du Louvre,
which is also the focus of the retrospective
exhibition. This work will be displayed in
the Hall Napoléon in the Musée du Louvre
from October 24, 2019 to February 24, 2020.
In addition, the virtual reality content of
the “Mona Lisa – Beyond the Glass” will belaunched simultaneously on VIVEPORT andother online platforms on the opening day of the exhibition, allowing such wonderful to reach audiences
around the world.

177

Social Investment and Contribution

Through the application of virtual reality technology, the museum's curatorial team can fully present
the essence of this world-famous painting in the retrospective exhibition. The audience will enter avirtual art space that has never been seen before, watching “Mona Lisa” up close and understanding
the story behind the painting and the artist's creative process. The “Mona Lisa – Beyond the Glass”
will present the latest scientific discoveries, expose details that cannot be seen with the naked eye, andanalyze in depth the painting techniques used by this great artist as well as the identity of the main
character in the painting.
The “Mona Lisa – Beyond the Glass” released on VIVEPORT and other online platforms will provide
more extended content. The audience will enter the Grand Gallery of the Musée du Louvre throughthe glass Pyramid designed by the late architect master Ieoh Ming Pei via virtual reality technology.
This edition will also present Da Vinci's other paintings, allowing the audience to have a more incisive
understanding of the important works of the great artist.
The “Mona Lisa – Beyond the Glass” was curated by HTC VIVE Arts, and jointly developed by Emissive
and the curatorial team of the Musée du Louvre. Through the virtual reality experience, the audiencecan appreciate Da Vinci's most famous painting “Mona Lisa” alone without being surrounded by thecrowd and enjoy freely the mountain landscapes in the painting. The “Mona Lisa – Beyond the Glass”
takes the audience to Da Vinci's art world and inspires new generations through the innovative thinkingof this great artist.

HTC 2019 CSR Report178

Blood Donations
Year
2017
2018
2019
Eight times every year HTC cooperates with the
Taipei Blood Center and Hsinchu Blood Center to
Number of incumbents
9,239
4,096
3,226
hold blood donation drives. Many of our kind-hearted
employees have developed the habit of regular blood
Blood Donation
748
695
799
donation since 2006. Every time the mobile vehicle
Donation Rate(%)
8.10
16.97
24.76
from the Blood Center comes by our employees all
Total blood donation(ml) 288,500 265,250 300,250
line up to make donations to give back to society.
HTC is recognized by Hsinchu Blood Center as aNote: The annual number of incumbents only counts the number in Taiwan
standing Honorable Blood Donor Group. In 2019,
employees responded enthusiastically to blood
donation activities, and the participation rate increased substantially by nearly 1.5 times. The total blood donatedin HQ & Plants was 127,000 ml, while the total blood donated in Taipei Office was 173,250 ml.

2019 Christmas season X Cross+ Market
In cooperation with Cross +, HTC invited young entrepreneurs to come to the HTC Christmas bazaar togive back to the community by support good people and good products. HTC employees gave the mostdirect support through practical actions and exerted the value of “giving”. These young startup owners
have given back to the community by supporting 10% of their income to the Rainbow Heaven, who
has long been committed to the development of young people’s physical and mental health, delivering
warmth at the end of the year.

The HTC Child Support ClubThe HTC Child Support Club was founded in 2006 as a spontaneous association formed by HTC employees. The
members raise money that is donated to the China Children’s Fund (CCF) to support the sponsorship of children
in need. In 2019, a total of 62 children were adopted, including 54 in China and 8 in foreign countries (including
Guatemala, Jordan, the Philippines, Senegal, Sri Lanka, Kyrgyzstan, Paraguay etc.).

Maternal Love in the Heart, Beauty of Sharing Love
2019 Mother's Day is different because ofyou! For this year's Mother's Day activities,
besides skin care products and beauty courses,
the highlight was the second-hand item
charity bazaar that was held for 3 days. HTC
employees supported the “Taipei Orphan
Welfare Foundation” and the “Taitung Joy
After-school Program” by taking concrete
actions, allowing these children and families
to receive help.
HTC held the second-hand item charity bazaar in the HQ & plants and Taipei Office, and received
enthusiastic support and response from employees. Within the three days, more than 500 items were
sold, and the cumulative sale income exceeded NT$ 40,000. All the proceeds from the second-hand item
charity bazaar will be donated to the “Taipei Orphan Welfare Foundation” and the “Taitung Joy Afterschool Program”, allowing the love of our employees to turned into practical support and help thosechildren and families who are in need. In addition to the second-hand item charity bazaar, HTC would
also like to thank many of its employees for their generosity and support through direct donations,raising a total of more than NT$ 100,000 for the Taitung Joy After-school Program.

179

Social Investment and Contribution

HTC 2019 CSR Report180

GRI 103:
The management approach and its components in 2019
Standard
Material Topics

Summary of the communities and associations participatedEconomic
Economic Performance

How HTC manages the topic

The purpose of the
management approach

Pay attention to corporate governanceand operational transparency, andformulate and implement a corporate
governance structure in accordancewith relevant laws such as the “Company
Law” and “Securities Exchange Act”,
and continuously improve management
performance.

Properly and effectively
assign the powers andresponsibilities of the boardof directors, managers, andshareholders to establish
and maintain an operatingteam that is accountable toshareholders“Corporate Governance PracticePrinciples”

Establish a Salary & Compensation
Committee to evaluate professionallyand objectively the salary &compensation policy and system, andassess progress in achieving the goals.

Protect the rights ofinvestors and otherinterested parties
through a comprehensive
and systematic CSR
implementation system.

“Salary & Compensation Committee
Organizational Procedures”

Organization Name

Membership

SDA (Secure Digital Card Association)

General member

Wi-Fi ( WECA Wireless Ethernet Compatibility Alliance)

General member

TCA (Taipei Computer Association)

General member

RBA (Responsible Business Alliance)

General member

GSM Association

MemberTAICS (Taiwan Association of Information and Communication Standards)

General member

AirFuel Alliance

General member

VESA ( Video Electronics Standards Association)

General member

Khronos Group-OpenGL(Open Standards for media Authoring and Acceleration)(The Industry's Foundation for High Performance Graphics)

MemberIndustry-Academy Alliance 3D & AR/VR image display Industry-Academy AllianceGroup member

Standard

NMEA (New Media Entertainment Association)

Group member

Material topics

JBRC (Japan Battery Recycling Collection)

General member

How HTC manages the topic

Taoyuan importers & exporters chamber of commerce

General member

Import ISO 14001 environmental
management system and verify it withexternal third parties.

CCSA (China Communications Standards Association)

General member

OPEN Alliance (One-Pair-Ether-Net Alliance)

General member

GTI (Global TD-LTE Initiative)

General member

3GPP (3rd Generation Partnership Project )General member

MIPI (Mobile Industry Processor Interface Alliance )General member

Bluetooth SIG (Bluetooth Special Interest Group)

General member

CITA (Cellular Telecommunications Industry Association)

Operators andindustry members
Member of the board

181

Social Investment and Contribution

Marketing Presence

Provide attractive and stimulating salary& benefit plans, establish relevant rules
to return operational performance to theemployees; and develop various welfare
measures and training mechanisms.
Conduct performance evaluation for all
employees every year, and offer salaryadjustments and incentive bonuses
based on the performance evaluation
results to ensure the compensationand growth of employees. This canlink together company’s finance andperformance.

Related policies“HTC Code of Conduct”“Rules for Derivatives Transaction”“Regulations for the Appointment
of Directors/Supervisors in Reinvestment”“Board of Directors Rules ofProcedure”

Grievancemechanisms
Investor Liaison :Telephone: +8862-8912-4138
E-mail: ir@htc.
com
Company
spokesperson andinvestor relations
Shen Daobang
spokesman@htc.
com

Ensure that the company’ssalary & compensation are
in compliance with relevantlaws and regulations andare sufficient to attract
talents.
Enable employees to dotheir best to maximize theirstrengths, and encourage
employees to continue towork hard and innovate intheir positions.

Environmental
Emission

Waste water and waste

Set up sewage treatment equipment in
the plant area, and regularly test andreport online.
Entrust lawful disposal agencies toproperly dispose of wastes, and carryout irregular inspections
Periodic inspections of waste storage
and temporary storage areas will
be conducted through inspection
schedules.
Establish supplier evaluation andmanagement system.
Refer to the “Code of Conduct for
Responsible Business Alliances”
to develop relevant environmental
specifications in the “HTC Supplier
Code of Conduct” to periodicallyassess suppliers’ compliance with andimplementation of the Code.

The purpose of the
management approach
Reducing waste throughclassification andadvocacy, and increasing
the efficiency of recycling.
Reduce the impact ofoperations on the naturalenvironment.
Extend the concept andrequirements of social
responsibility management
to the supply chain andimplement supply chain
responsibility.

Related policies“ESH Management Manual”“HTC Corporate Social Responsibility
Policy”“Process for Removal and HandlingBusiness Waste Manual”“Procedures for Sewage System
Operation, Repair, and Maintenance”“HTC Supplier Code of Conduct”“Vendor Management Procedure”“Vendor Survey Procedure”“Supply Chain CSR and QMS Audit
Procedure”“Contractor Environmental,
Safety and Health Management
Procedures”“Environmental, Safety and
Health, and Energy Regulations
Requirements Management
Procedures”“Supplier Environmental, Safety and
Health, and Energy Management
Procedures”

Grievancemechanisms
Internal: e-mails,
announcement
methods, proposal
improvement bills,
or discussions
with the Healthand Safety
Committee
External
stakeholders
can file anappeal throughCorporate Social
Responsibility
Corporate_
responsibility@
htc.com. The casewill be transferredinternally to the
EA. According
to the “EP00000010
Procedures for
the Control ofEnvironmental
documents”

HTC 2019 CSR Report

182

GRI 103: 2019 Management Approach

Standard

SocialMaterial Topics

Standard

Employment
Occupational Health and Safety
Customer Health and Safety
Marketing and Labeling

How HTC manages the topic
HTC has a well-established parental
leave application mechanism to protect
the rights of employees.
Provide diverse and fair employment
opportunities for employees.
The board of directors set up a salarycompensation committee to assess
the salary and remuneration policy andsystem of the directors, supervisors,and managers and achievement of
performance goals.
Provide attractive, motivating salary andbenefits programs.
The company convenes a labormanagement conference every quarterand records and tracks problems andimproves results.
The Ministry of Environmental Protection
and the Department of Labor andSocial Security are responsible for the
implementation of the implementationof the occupational safety and healthand energy management system anddraw up the annual plan.
Refer to the “Code of Conduct for
Responsible Business Alliances” toformulate relevant labor regulations in
the HTC Supplier Code of Conduct.
Build inspection standards for hazardous
substances.
Mark product information, and add
environmental protection material
certification on the packaging.

Labor/Management Relations
Employee Diversity and Equality
Customer Privacy
Socioeconomic Compliance

The purpose of the
management approach
Ensure the rights andinterests of all employees.

Related policies“HTC Code of Conduct”

Promote good labor
relations.

“Customer Satisfaction
Management Program
Specification”

Protect the labor rights ofmultiple employees.

“HTC Corporate Social
Responsibility Policy”

Reduce the turnover rateof employees.

“HTC ESH Policy”

Reduce the risk ofworkplace hazards toemployees and reduce
occupational hazards.
Attract and retain
outstanding talents.

“ESH Management Manual”“Safety and Health Rules”“HTC hazardous substancemanagement policy”“HTC Supplier Code of Conduct”“HTC Information Security Policy”

Reduce the negative
impacts of end career
employees.

“Personal Information Protection
Management Policy”

Ensure that the products
are non-toxic andharmless green products
and comply with nationallaws and customer
specifications.

“Customer Service Privacy
Protection Declaration”

Protect customer healthand safety.
Protect customer privacy.
Reduce productharmful substances andpackages. Conformity torelevant socioeconomic
regulations.

“Privacy Policy”“HTC Supplier Code of Conduct”“Vendor Management Procedure”“Vendor Survey Procedure”“Supply Chain CSR and QMS
Audit Procedure”“HTC Conflict Mineral
Procurement Policy”“Supplier Environmental,
Safety and Health, and Energy
Management Procedures”

Set up internal control mechanisms tocontrol technical data, software andhardware, and customer patents or
intellectual property rights.
Reference Responsibility Business
Alliance Code of Conduct Developing
Corporate Social Responsibility Policy
and Set up a supplier assessment andmanagement mechanism.
Reference Responsibility Business
Alliance Code of Conduct Developing“HTC Supplier Code of Conduct”, andperiodically assess whether suppliers
meet and implement the guidelines.

Material Topic
Economic
Performance

Independent director, supervisor system, the internal audit system
Internal Audit System
Corporate Governance Evaluation of TWSE

Market Presence

Compensation Committee

Economic
Grievance mechanisms
The grievancemechanism includes
employee complaint
hotline, complaintsuggestion box,
grievance e-mail, andsexual harassment
grievance mail box

Emission
Environmental
Waste Water andWaste

manufacturing
employees of the
production line
company extension
38585

Set up local customer
service hotlines in 22
countries around theworld
Build more than 20
websites in different
countries

76, 87, 101-104

Customer
Health and Safety

69, 97-100

Customer Privacy

Information security /privacy management
Corporate customer satisfaction management
General Data Protection Regulation(GDPR)
Domestic and foreign related capital regulations

47-49, 69

Marketingand LabelingMarketing related regulations(domestic and foreign)105-107

Socioeconomic
Compliance

Other social and economic related regulations(domestic and foreign)

Employee Diversity
and Equality

SocialHTC CSR Committee
Responsible Business Alliance (RBA)
ISO 14001 Environmental Management
Domestic related environmental regulations
Supplier assessment and management mechanism.
ISO 14064-1 Greenhouse Gases

HTC CSR Committee
Responsible Business Alliance (RBA)
IECQ QC080000 Hazardous Substance Process Management System
UL Certificate
Third-party insititution (TUV/ITS)
Meets California Energy Efficiency Regulations
Meets the SAR standards of the US FCC and EU CE
Customer satisfaction survey

Occupational Healthand Safety

Customer service
hotline: 0809-090-166,
please call: 02-21626788

44, 129

28-29, 43-45, 59, 60, 113,
118, 131-140

Labor/Management
Relations

Employee helpline
e-mail HelpMe_8585@
htc.com

22, 44-46, 130

HTC CSR Committee
Responsible Business Alliance (RBA)The Universal Declaration of Human Rights (UDHR)
Corporate Governance Evaluation of TWSEOHSAS 18001 Occupational Health and Safety Management System
Labor contract
Industry union
Grievance mechanisms
Employee satisfaction survey
Labor-management meetings

Employment

Other generalemployees company
extension 28585

The result of Evaluation(referring page)Mechanism of Evaluation

Provide PR, Service,
Copyright, Security andother different types of
e-mail28, 45-46, 59, 69,
92-100, 113

HTC adopts the Conflict Minerals Survey
Template to conduct annual assessment
on suppliers’ mineral sources.
Establish KPIs, and progress feedback
mechanisms to effectively manage thesupply chain.

183

GRI 103: The management approach and its components in 2019

HTC 2019 CSR Report184

GRI Standards Content Index

GRI Standard

Disclosed Topic

Note:

RemarkGRI Standard

Disclosed Topic

Referring Page

Remark

102-01Name of the organization

9102-42

Identifying and selecting stakeholders

33-34

102-02

Activities, brands, products, and services

9102-43

Approach to stakeholder engagement

33-34

102-03

Location of headquarters

12

102-44

Key topics and concerns raised

33-34

102-04

Location of operations

9102-45

Entities included in the consolidated financial statements

102-05

Ownership and legal form

9102-46

Defining report content and topic Boundaries

102-06

Markets served

12102-47

List of material topics

31-32

102-07

Scale of the organization

102-48

Restatements of informationNone

102-49Changes in reportingNone

102-50

Reporting period

102-51

Date of most recent report102-52

Reporting cycle

102-53

Contact point for questions regarding the report

4102-54Claims of reporting in accordance with the GRI Standards

2102-55

GRI content index

185-188102-56External assurance

189-190

103-1

Explanation of the material topic and its Boundary

103-2

The management approach and its components

103-3

Evaluation of the management approach

14, 22, 114

102-08

Information on employees and other workers

114-116102-09Supply chain

13-22

102-10

GRI 102:
GeneralDisclosures
2016

Referring Page

Significant changes to the organization and its supply chain

GRI 102:
GeneralDisclosures
2016

Please refer to Market
Observatory Post System
https://mops.twse.com.
tw/mops/web/t146sb05

102-11

Precautionary Principle or approach

47-53

102-12External initiatives

102-13

Membership of associations

181

102-14

Statement from senior decision-maker

7-8

102-15Key impacts, risks, and opportunities

47-53

35-40, 49

102-16

Values, principles, standards, and norms of behavior

23-24

102-17

Mechanisms for advice and concerns about ethics

43-44

102-21

Consulting stakeholders on economic, environmental, and social
topics102-22Composition of the highest governance body and its committees

Please refer to
HTC 2019 Annual Report
P.26-27, 83, 91

102-23Chair of the highest governance body

Please refer to HTC 2019
Annual Report P.26

102-25

Conflicts of interest

Please refer to
HTC 2019 Annual Report
P.70-74, 94

102-36

Process for determining remuneration

102-40

List of stakeholder groups

102-41

Collective bargaining agreements

GRI 103:
Management
Approach2016

27-29, 33-34

No agreement

2, 31-32

2
2019/6
Once a year32
182-183
184

Topic-Specific Disclosures: GRI 200 (Economic topics)
GRI 201:
Economic
Performance2016

201-01

Direct economic value generated and distributed

22

201-03

Defined benefit plan obligations and other retirement plans

130

Ratios of standard entry level wage by gender compared to local
minimum wage

129

205-01

Operations assessed for risks related to corruption

46

205-02

Communication and training about anti-corruption policies andprocedures

205-03

Confirmed incidents of corruption and actions taken

GRI 202:
Market Presence 202-01
2016

44
33-34

Please refer to HTC 2019
Annual Report P.146

GRI 205:
Anti-corruption
2016

46, 124None

represents the topic disclosed voluntarily by HTC, not a major topic identified in 2019.

185

GRI Standards Content Index

HTC 2019 CSR Report186

GRI Standard

Disclosed Topic

Referring Page

RemarkTopic-Specific Disclosures: GRI 300 (Environmental topics)

GRI 302:
Energy2016

GRI 305:
Emissions
2016

GRI 306:
Effluents and
Waste
2016
GRI 308:
Supplier
Environmental
Assessment
2016

77

Energy consumption within the organization

302-04

Reduction of energy consumption

77-81

302-05

Reductions in energy requirements of products and services

92-93

305-01

Direct (Scope 1) GHG emissions

305-02

Energy indirect (Scope 2) GHG emissions

305-03

Other indirect (Scope 3) GHG emissions

305-05

Reduction of GHG emissions

76

306-01

Water discharge by quality and destination

87306-02

Waste by type and disposal method101-104308-01

New suppliers that were screened using environmental criteria

60-67

●

308-02

Negative environmental impacts in the supply chain and actions
taken

62-67

●

GRI 402:
Labor/
Management
Relations
2016

GRI 403:
Occupational
Health and
Safety2018

187

401-01New employee hires and employee turnover

401-02

Benefits provided to full-time employees that are not provided totemporary or part-time employees

401-03

Parental leave

137402-01Minimum notice periods regarding operational changes

138

117
131-137

403-01

Occupational health and safety management system403-02

Hazard identification, risk assessment, and incident investigation

160, 164403-03

Occupational health services

155-159403-04

Worker participation, consultation, and communication on
occupational health and safety

141403-05Worker training on occupational health and safety161

403-06

Promotion of worker health146, 148, 151

403-07

Prevention and mitigation of occupational health and safety impacts
directly linked by business relationships

62, 104, 164

GRI Standards Content Index●●

GRI 403:
Occupational
Health and
Safety2018

141

Disclosed Topic

Referring Page

Remark

403-09Work-related injuries

163

403-10Work-related ill health163404-01

Average hours of training per year per employee

128●404-02

Programs for upgrading employee skills and transition assistanceprograms

120-128, 138●

404-03

Percentage of employees receiving regular performance and careerdevelopment reviews

123, 128●405-01

Diversity of governance bodies and employees

405-02

Ratio of basic salary and remuneration of women to men

129

GRI 406:
Nondiscrimination
2016406-01

Incidents of discrimination and corrective actions taken

None

●

GRI 410:
Security
Practices2016

410-01

Security personnel trained in human rights policies or procedures

141●

414-01

New suppliers that were screened using social criteria

60, 62-67●

414-02

Negative social impacts in the supply chain and actions taken

62-67

Assessment of the health and safety impacts of product andservice categories

97-100Incidents of non-compliance concerning the health and safety
impacts of products and services

None417-01Requirements for product and service information and labeling105-107417-02

Incidents of non-compliance concerning product and service
information and labelingNone417-03

Incidents of non-compliance concerning marketing communications

None

GRI 418:
CustomerPrivacy
2016

418-01Substantiated complaints concerning breaches of customer privacy
and losses of customer data

None

GRI 419:
Socioeconomic
Compliance2016419-01

Non-compliance with laws and regulations in the social andeconomic area

None

GRI 404:
Training and
Education
201676

Topic-Specific Disclosures: GRI 400 (Social topics)

GRI 401:
Employment
2016●

302-01GRI Standard

GRI 405:
Diversityand Equal
Opportunity
2016

GRI 414:
Supplier Social
Assessment
2016

GRI 416:416-01
Customer Healthand Safety
416-02
2016

GRI 417:
Marketing andLabeling
2016

44, 114-116, 119

HTC 2019 CSR Report188●

Assurance Statement

189

Assurance Statement

HTC 2019 CSR Report190