2020 HTC CSR Report

CSR Report
2 0 2 0 HTC Corporate Social Responsibility

Editorial Principle
HQ & Plants

Taipei Office 1
Taipei Office 2

Thank you for reading the ninth 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
all these issues.

2020 HTC CSR Report Organization Coverage Information

As a global mobile-device brand, we are ready to confront all the challenges that might present themselves. For
each major CSR issue that relates to our future development, we make it clear at the beginning of each section
which challenge 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 2020.
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

The HTC 2020 CSR Report is downloadable in PDF format.

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+8862-89124138

Taipei Office 2

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

Time Coverage of Disclosure
We plan to issue the HTC Corporate Social Responsibility Report annually. This report generally covers the year
2020 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 2019 to 2021 May, as well as the HTC CSR management policies, key issues, and performance, responses andactivities for previous years.

Report BasisThis report has been prepared in accordance with the Global Reporting Initiative (GRI) Standards Core Option andAA1000 standards and has been confirmed by SGS-Taiwan to be in compliance with AA1000AS Type II high-levelassurance and GRI Standards Core option.

2020

Process of Reporting Quality Management

年
企
業
社
會
責
任
報
告
書

2020 HTCCSR Report
宏
達
國
際
電
子
股
份
有
限
公
司

CompileCS R Rep

2 0 2 0

宏達國際

電子企業

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

ort

社會責任

報告書

HTC CSR Report 2020
Edit

• The Quality and Sustainability Management Department will coordinate with all departments todiscuss the progress of planned goals and future directions.

Report Scope and Boundary
The organizational boundary, as mentioned in this annual report, mainly covers the company office buildings andplants in Taiwan: the headquarters in Taoyuan and two office buildings in Taipei. All HTC business operations in
Taiwan are within the boundary.

Review

Finalize001

Editorial Principle• Internal The information required for the report is collected by the person-in-charge of eachdepartment and confirmed by the corresponding supervisor.
• External SGS Taiwan verified this report in accordance with AA1000 AS Assurance Standards
and GRI Standards. This report is in compliance with the core options of the GRI Standards andAA1000 Type II High Assurance.

• 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.

HTC 2020 CSR Report002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, andinternational 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 andrealization of CSR issues. The forecasts are not promises by HTC of guaranteed financial, operational, and businessperformance.
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 orgraphics.

• Financial data was checked and confirmed by Deloitte & Touche, and was calculated in NT$.
• ISO14064 greenhouse gas emissions and ISO 50001: 2018 management systems were verified by
AFNOR Asia.
• ISO 14001: 2015 and ISO 45001: 2018 management systems were verified by SGS Taiwan.
• The AA1000AS Standard was verified by SGS Taiwan.

Feedback
If you have any questions about this HTC Corporate Social Responsibility Report 2020, 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

003

Editorial Principle

HTC 2020 CSR Report004

Contents
043

Editorial Principle 001
Statement of the Management 007
The 2020 management approach and its components
2020 Management Approach

205

207

GRI Standards Content Index 208
The United Nation's Sustainable Development Goals 213
Assurance Statement 221

133

Corporate Social
Responsibility

The Mechanism for Committee Operation

Friendly
Workplace045

Staff management 135

CSR Management Procedures and Systems 047

Talent Attraction and Retention 141

HTC 2020 Material Issues and Boundary 049

Complete Education and Training Plan 142
Sound Wage and Welfare System

148

Listening to the Voice of the Employee 157
Occupational Health and Safety 161

009

053

About HTC

Responsibility Management

Social Investment
and Contribution

Global Operation Locations 012

Corporate Governance 055

HTC Foundation 179

Industry Overview 013

Tax Management 060

Other Social Engagement Activities 181

Product Overview 020

Risk Management

Overview of Financial Performance 026

Innovative R&D Management 081

The Pursuit of Brilliance 027

Customer Management 087

031

091

COVID-19 Prevention
Management

177

062

Sustainable Agenda

COVID-19 Prevention Guidelines within HTC 034

Sustainable Environment 094

HTC HELPS: Anti-COVID-19 with Technology 036

Sustainable Design 102
Sustainable Manufacturing Process 113
Sustainable Product 123
Sustainable Supplier Chain

126

Statement of the Management
Thank you for taking the time to peruse the 2020 “Corporate Social Responsibility Report” issued by HTC. We
continue to follow the latest “Global Reporting Initiative Standards” and AA1000 standards Type II High Levelof Assurance to report information disclosure to the general public and all stakeholders. The relationshipcommunicates with HTC's commitment and achievements in reflecting social responsibility and moving towards
sustainable development.
The pandemic has acted as a catalyst to accelerate the digital revolution, from the global adoption of virtual
meetings for work, learning and pleasure to the vast proliferation of creative content. Areas like healthcare,education, and entertainment have gone online like never before, and the extended duration of the pandemic
suggests that several of the business and lifestyle disruptions such as remote working that have emerged over2020 will become permanent. At HTC, we believe that VR will increasingly come to the forefront as the most
realistic in-person remote meeting experience, and products like the own-brand VIVE Sync business meeting
software, and the VIVE XR Suite, a tailored selection of VR applications, will enable people to continue socializing,meeting, learning and training in the virtual world. Digital technology has brought us together in new ways, andwith its extensive portfolio of devices, platforms and software, HTC is positioned well to take advantage of thisnew normal.
Management changes in 2020 brought forward a new approach regarding the corporate structure of HTC; inparticular, the most radical corporate restructure in HTC’s history. As HTC has diversified into new products,
sectors and markets over the past few years, the previous structure was increasingly unsuitable to ensure theinnovation focus for which HTC is recognized. Leaders of product areas needed more flexibility to focus on theirown business, and greater incentive to drive efficiency and effectiveness across their teams. Thus, HTC laid
the foundations for the creation of seven distinct business units out of HTC’s core activities, which will operatewith substantial autonomy for greater agility. The business units are: VIVE Virtual Reality; 5G System Solutions;
Smartphones and IoT; Content and Platforms; DeepQ Healthcare; VIVE Originals; and VIVE Arts.
The decentralization of decision-making is already inspiring the entrepreneurial spirit in each business unit, withleaders highly motivated to establish their business and drive future growth. Each business unit leader will be
responsible and accountable for their own sales and retail execution, brand-building and business operations.
HTC will be the corporate umbrella for all of these businesses, providing enabling functions such as humanresources, financial, legal, IT, corporate administration, and PR and marketing support, as well as acting as anaccelerator and an incubator, providing these business units with strategy and operations support, performanceaccountability and investment finance. This new structure will unlock the tremendous value and potential of HTC,
and grow our brand and our business, and has the backing of our Board of Directors and our top management. It
is a clear strategy to optimize HTC’s resources and provide greater focus and accountability for each business in
our portfolio, which will in turn provide greater focus and accountability for our employees, and positions HTC
well for future growth.
HTC continues to enhance operations across the factory, and our R&D and testing laboratories, improving
manufacturing processes and quality standards as well as seeking areas to reduce our emissions and raise ourpower efficiency. We call on our supply chain partners to continue working with us on evaluations and actions on
climate change measures. In the Carbon Disclosure Project (CDP), the world’s largest carbon disclosure platform,
HTC has attained management level (B grade) in the climate change rating (compared to a global regional averageof C grade).

007

Statement of the Management

HTC actively promotes the concept of waste reduction throughconcrete measures such as the classification, recycling andmanagement of waste at the front end for employees to reduce
waste generation, as well as setting dedicated areas for generalwaste, resource recycling, and kitchen waste to facilitate ourrecycle-and-reuse strategy, reducing the amount of waste
produced and improving cleanliness. Through these measures,
HTC’s waste recycling rate has significantly increased over the lastten years, from 57% in 2011 to 78.8% in 2020.
In early 2020, HTC was swift to implement appropriate measures
to prevent the spread of COVID-19 in our offices across the globe
to protect our most important asset, our talent, in line withand often exceeding the advice of local government and healthofficials, and we continue to closely monitor the situation. Boththe Line Bot of Disease Control Butler and Disease Containment
Expert developed by HTC’s DeepQ business unit played an
important role in the digital frontline of the virus. The former
provided pandemic-related information issued by the Taiwan
National Health Command Center, including the latest outbreakalerts, online press conferences, fake news clarifications, andmore, while the latter enables those in home quarantine to reporttheir daily health status and obtain home quarantine related
information.
As we close this extraordinary year, HTC would like to sincerely
thank our shareholders for their continued support. The HTC
brand remains known around the world as a brand that solves
problems and make people’s lives better. Now, HTC is creating a
new era of success. With the new organization structure coming
into force in early 2021, HTC anticipates more focused execution
across all of our business lines, as well as greater recognition forour efforts, as we strive for truth, goodness and beauty on ourpath to the realization of VIVE Reality.

HTC
Chairwoman

HTC 2020 CSR Report008About HTC –Name
HTC Corporation (TWSE stock symbol 2498)

Address
No 23, Xinghua Rd, Taoyuan Dist.,
Taoyuan City, Taiwan

EstablishedMay 15, 1997

SectorTelecommunications network Industry

Main business
Smartphone/HTC phones and accessories/
Virtual reality device

Consolidated revenue
NT$ 8,186,443,850 (2020-12-31)

The global leader in innovative mobile phone &Virtual reality design – HTC

Global Operation Locations

The HTC Corporation (HTC) was established in 1997. HTC brings brilliance to life through leading innovation insmart mobile device and experience design. 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 applyingthat same innovative approach to connected devices and virtual reality. To date, our Company has been throughfour 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 realexperience 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, humanities andimagination to achieve a richer enjoyment of a better life.
Through our leading virtual reality line, HTC VIVE, our rich history of experience in mobile internet devices, andfocused investment in key technology areas, HTC is now helping to drive this new computing paradigm and thesociety transformation that will ensue. This remarkable new world will be all-embracing, generating a far larger
virtual economy, a much broader range of fantastic experiences, and far more meaningful social interaction,
which will bring people closer together and foster greater empathy for each other.
At the same time, HTC continued to develop and refine our industry-leading mobile technology expertise.
Smartphones remain a mainstay of the Company, with this division continuing to integrate the latest technologies
such as 5G and advanced photographic capabilities into some of the most beautifully crafted devices on themarket. At the same time, HTC created a new division focusing solely on applying our world-class 5G networking
expertise to consumer, enterprise and municipal sectors, supporting the drive to expedite 5G adoption and solve
challenges for business and society.

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*,Kaohsiung

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

America
United States: Houston

MexicoAustralia: Sydney

Human health is fundamental to improving people’s lives, and the HTC DeepQ business embeds advanced artificial
intelligence and VR technologies into a range of hardware and software solutions aimed at raising awareness ofhealth issues, enabling effective remote healthcare, and supporting the medical profession and government in avariety of ways.
The pursuit of VIVE Reality sees HTC transition into a complete solution company, creating not only leading
hardware in strategic markets, but also building industry-leading platforms, software, content and services tocreate new revenue streams and lay the foundation for our future growth.

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 and integration of
our operational HQ, HTC provides customers with a network of professional
services.
HTC stands in the immediate presence of our customers and provides instantservice. 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.

011

About HTCHTC 2020 CSR Report012Industry Overview
Since its establishment, HTC has had very strong R&D capability by producing a stream of first-class products forthe international market. The company creates inspiring products and experiences through a strong line of mobile
solutions, connected devices, and VIVE virtual reality (VR) hardware and ecosystem.
HTC offers a diverse portfolio of mobile and VR hardware, software, and content that transforms the way
consumers and businesses see and interact with the world and beyond.

013

About HTCHTC 2020 CSR Report014

Smartphones

Virtual Reality

The smartphone industry welcome new technologies to enter the 5G era in 2020. The global smartphone market
was expected to embrace the new business opportunities with a wave of new 5G smartphone purchases after 5G
was commercially deployed globally in 2020. However, due to COVID-19 since the beginning of 2020, the global
smartphone supply and demand declined, and it also partially delayed the launch of 5G in some regional market.
Therefore, global smartphone shipments continued to decline in 2020. Looking forward into 2021, the economy
is expected to recover as the pandemic is controlled, and with everyday life and work returning to “normal”,
smartphone sales are expected to also return to growth.

Virtual reality comes from the human pursuit of immersion. It is also the technology development direction thathas been encouraged by the smartphone industry through various display technologies, processors, controllers
and other key technologies over the past 10 years. While consumers are satisfied with visual effects, they also hope
to experience “virtual new worlds”.

Figure Communication Technology Evolution

The hardware and software sessions can be regarded as the upstream of the VR industry. The hardware includes
component parts like chipsets, displays, optical modules, and sensors, as well as various types of integration
with hand recognition, tracking and positioning, and somatosensory interaction; Software includes various
development platforms and tools including OS, cloud platforms, SDKs. The network and content can be regarded
as the midstream of the VR industry, where the network includes operators and various levels of network
infrastructure; the content includes content production related to the VR applications in various industries.
Distribution can be regarded as the downstream of the VR industry, including content distribution platforms,
product distribution channels.

Year

1980

Technology

AMPS

Service

Call

Speed
Frequency

2 Kbps
800-900 MHz

1991

2001

2008

2020

GSM
CDMA

WCDMA
CDMA2000
TD-SCDMA

LTE

Millimeter Wave, Massive
MIMO, Beamforming

Call, Message,
Text MailCall, Message,
Internet,
Streaming
serviceCall, Message,
Internet, 1080P
Video streaming
serviceCall, Message,
Internet, 4K Video
streaming service,
VR streaming,
Auto Guided Vehicle,
Teleoperation

10 Kbps
850-1900 MHz

3.8 Mbps
1.6-2.5 GHz

0.1-1 Gbps
2-8 GHz

1-10 Gbps
3-300 GHzOver the past few years, smartphones have been constantly and continuously updated with new and innovative
functionality. Smartphones have fully transitioned from traditional feature phones into the touchscreen-enabledcommunication products with independent operating systems we all know today. Consumer demand has led tothe development of components including high-performance miniature camera lenses and powerful batteries,
and this has also greatly accelerated and stimulated the vigorous development of all communications-related
hardware industries. At present, the smartphone industry is already a mature industrial chain with professional
divisions of labor. Each specialized component integrated into smartphones comes from a different specialized
supplier. After being assembled by the manufacturer, it is then sold by a dealer or a telecommunications company.

Figure Industry relationship chart
Upstream suppliers

According to IDC’s public release of the 2020 VR industry research white paper, the VR industry chain can be
subdivided into five parts: hardware equipment, software, network, content, and distribution. Each part is linked
and inseparable.

Upstream
HardwareFinished
Product
OutputEquipmentPC,smartphone,
all-in-one
headsetInteractive
Manufacturers

Downstream channels

Components suppliers

Mobile phone design

Brand

Operating systems

Mobile phone manufacture

Telecom service providers

suppliers

Mobile phone assemblyDistributors

Device
OEM/ODM

Mindstream

Downstream

Software

Network

Content

Components

System &Platform

Network
Service &Equipment

Content
Product &Application

Distribution
Platform

ChipsetsOS
Cloud
Platform

VR Content
Production &Applications invarious Industries

Content
Distribution

Displays

Operators&Network
Infrastructure

OpticsSDK/API

Sensors

Distribution

Professional,
Integrated

Service
Operation

DesignProject
Application
Operation

Product
Distribution
ChannelOff-line,
On-lineBettery

Retailers

015

About HTCHTC 2020 CSR Report016

At present, the major hardware manufacturers in the VR industry are VIVE by HTC, Oculus by Facebook, and
PSVR by Sony. Each manufacturer adopts different development paths due to different industrial strategies. The
VR industry trends are divided into three major directions: one is to improve the hardware specifications of VR
headset; the second is to cooperate with software vendors to develop application services to meet consumer needs;
the third is to expand more optimized business applications in individual fields.
Hardware manufacturers from the so-called “first year of VR” in 2016, when VR products began to enter the
consumer market, first attracted the public with gaming applications. Playing games with VR not only provides
advanced visual stimulation, but also delivers a more immersive content experience. In the past, VR headsets weremainly connected to a computer. A gaming PC with strong graphics capabilities was required to have a better
visual experience. Recently, manufacturers have been working diligently to develop standalone devices, whichallow consumers to enjoy more freedom of movement, reduce the interference of the connection cable and to
improve the user experience.
The development of VR hardware depends on the continuous cooperation of software developers. For example,
game applications are represented by the well-known game platform Steam, and HTC cooperates with developers
to independently develop the VIVEPORT platform so that developers can offer their application services, allowing
for the use of VR not only in games, but also in movies, social media, and other visual mediums. As for VR, webelieve 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 useful applications for professional use. From theperspective of the currently known application industries, medical and architectural professional fields areespecially quick to adopt and apply VR, especially for use cases which require heavy 3D visualization. HTC aims
to use VR to make medical training more efficient and effective. By using VR for surgery simulation and medical
equipment operation training, for example, students and surgeons have significantly increased their surgery
success rate and their confidence in how to deal with high-pressure scenarios.
Entering the new 5G era, 5G technologies and technical demands have contributed to the advancement andpopularity of high refresh rate displays and other low-latency components critical for VR. The developmentof AI and big data technology has also accelerated the development of VR from consumer-level to largescale commercial-level applications. With the impact of COVID-19 and the resulting “Home Economy”, moreconsumers have begun to step into VR as VR acceptance and adoption have been able to increase. For example, VR
technologies have played a pivotal role in promoting online real estate brokerage businesses, enabling consumers
to visit new real estate listings without leaving their homes, greatly improving the efficiency of viewings andalso allowing all parties to remain safe. VR has already delivered on its unique value for personal consumer
entertainment and commercial applications. In the future, there will be more and more application scenarios for
VR in the industry and consumer market, and the VR industry will enter a period of rapid development.

HTC Chairman Cher Wang Awarded Accenture VR Lifetime
Achievement Award
The founder, chairman, and CEO of the Company, Cher
Wang, was awarded the “Accenture VR Lifetime Achievement
Award” from The Academy of International Extended Reality(AIXR) in recognition of Cher Wang’s vision of VIVE Reality.
The chairman and CEO of HTC, Cher Wang, said that she wasextremely “honored to receive this award, and dedicatedit to all of the teams and partners who dared to dream
and are working hard to make the vision happen.” It is
still the exploration period for virtual reality technology
with new applications being invented every day. Many
people, corporates, schools, and museums are expecting theinfinite potential of VR technology to be used and appliedin collaborative efforts, training, education, medicine, artand culture, and even global environmental sustainability
management, to name a few. VR is a key technology that can
open up a bright future.
The CEO of AIXR, Daniel Colaianni, said that he was honored to announce Cher Wang as the winner ofthe Accenture VR Lifetime Achievement Award this year. He also encouraged the next generation to thinkout of the box and to adventurously attempt to continue developing digital technology. He also thanked
Accenture for its support which allowed AIXR to be able to recognize such achievements and therefore help
to nourish this growing industry.

Re-investment & Affiliated Companies
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 and analyses of industry
trends, market competition, team experience, businesses models, and risk assessment, strategic investments havebeen carried out through equity investment or mergers and acquisitions. The specific objectives are to continue toenhance product and service quality, strengthen the development of key technologies, and grasp the future market
demand, thereby continuing to enhance the core competitiveness of HTC.
In order to provide different solutions for enterprise clients, personal consumers, and telecom operators, thecompany continues to deepen the enhancement of virtual reality and augmented reality related new technology,
application software, and content expansion through strategic investment, to deepen the enterprise market andmass consumer market.

017

About HTCHTC 2020 CSR Report018

Product Overview
HTC has been tapping into the possibilities of smartphones through brand new technology in thetelecommunications area. Extensive and innovative VR, AR, AI, blockchain, and high-speed 5G networks areamalgamated to create HTC’s technological vision of VIVE Reality.

Smartphone

HTC has consistently put great effort in the smartphone market. In 2020, we released three midrange
smartphone models, including the U20 5G, the Desire 20 pro, and the Desire 20+. Of these three, the U20
5G is not only the first 5G smartphone from HTC, but the world’s first Made In Taiwan 5G smartphone
as well. U20 is the manifestation of how HTC commits itself to elevating the innovation and functionalityof products. It fully supports 5G EN-DC frequency range in Taiwan and adopts the latest double module
processor, SA & NSA of Qualcomm, to ensure the flexibility of transitioning from 4G to 5G. Compared tothe previous generation of products, drawing performance has increased by 20%. From 4K home cinema
to video games, one device can meet all of your entertainment needs. We will continue to collaborate withmajor e-commerce companies and global telecom operators to develop core products for a 5G network.

5G entertainment

019

About HTC

5 camera
Ienses

Reflective mattefinish

6.8",20:9
display

5,000 mAhbattery

HTC 2020 CSR Report020

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.

VIVE Cosmos
VIVE Cosmos debuted at CES
in the USA in January 2019and is the latest headset of the
VIVE series. It provides thehighest level of comfort andutilizes a simple installationand operation experience
to ensure that users canjump into the world of VR at
any moment. VIVE Cosmos
does not need any external
tracking and positioning
devices so you can utilize
them in your space withmaximum flexibility. It can be used at home or on the go, and it provides more options for computerization
sources for gaming computers. With the launch of VIVE Cosmos, HTC redefined the convenience of VR
installation and the user environment. VIVE Cosmos will be the first VIVE headset equipped with a “VR
Reality System”, a brand new VR user experience invention. VIVE Cosmos series was awarded “FastCompany Innovation by Design Awards” from the influential business magazine, Fast Company, whichenjoys equal popularity with the likes of Fortune and BusinessWeek. Their recognition shows that VIVE’s
hardware design stands out among many world-class products - an important step for HTC.
With a slick design of metallic blue tones that diffuse a sense of futurism, the most distinguished and eyecatching feature is the small holes in the front of the headset for ventilation purposes. Because of this,gamers can fully and comfortably immerse themselves in the VR sceneries and experience. The overalldesign, having more facial coverage, evenly divides the weight to the player’s nose, cheek, surroundingparts of the eyes, forehead, and head. Consequently, players can spend more time in the virtual reality
world without feeling uncomfortable. The design team carefully shaped the headset based on ergonomics
in order to fit different shapes of faces and degrees of eyesight; players can wear the headset even withglasses. With all the aforementioned design elements put together, the result is that the product can avoid
the penetration of external light – a crucial feature for any VR headset of any brand.
In addition to the ergonomic applications that are essential for players, adjustable module options are
the core functionality of VIVE Cosmos. Players can easily switch to different panels with different specs
according to the contents applied. Consumers can upgrade their panels without difficulty regardless ofwhether they are tracked from the inside out or outside in. Additionally, this also reduces electronic waste.
Another feature that players appreciate is the ability to easily lift up the helmet. This design enables players
to switch between the virtual and real world swiftly. It is extremely useful for developers and content

021

About HTC

creators to frequently switch and check between the virtual and real world. Normal players can also
quickly pause the virtual experience to attend to immediate matters at hand.

VIVEPORTVIVEPORT is a global platform
for VR contents and subscription
services. The platform is available
in 70 countries, and there arethousands of VR contents andcounting for our users over the
globe to choose from. Other
than that, the platform supports
various models of VR Headsets,
including PC-Powered VR
Headsets, All-in-one devices, andmobile ones as well.
To better suit the need for diversified content from our users, we introduced VIVEPORT Infinity in 2019 as
the world’s first unlimited VR subscription service platform. Ever since it has created a brand new contentbased business model in the VR industry. This service does not only create more VR application demands
but also assists developers with being closer to consumers. Although confronting the challenge of thepandemic in 2020, the development of VR applications featuring the virtual world is still full of dynamismand growth.
Besides the benefits of being eco-friendly by transforming physical to virtual platforms which caneffectively decrease consumption of resources, VIVEPORT also emphasizes equality and mental healthin the field of CSR. All content needs to be confirmed with the “Content Guidelines” of VIVEPORT before
being released. If there is any discriminatory content related to race, ethnicity, social class, or language,etc., it will not be fit for the market. After content is released, it is still under surveillance for any violationsof the guidelines. HTC exists to collaborate with all developers to create a high-quality virtual content
environment.
In 2020, the quality and quantity of VR content greatly increased - there were 30 new works on the platform
every month on average. In addition to game contents, VIVEPORT continues to tap into more possibilities
for the VR experience. VIVEPORT participated in important events such as Venice International Film
Festival, the largest independent film festival in the UK, Raindance Film Festival, two music festivals, anda VR fashion show in the London Film Festival in 2020. This displayed that users could have different VR
experiences apart from just the games on the VIVEPORT. It is also worth noting that two Emmy awardwinning films, “Awavena” and “The Line”, were also released on the VIVEPORT last year.

HTC 2020 CSR Report022

Healthcare
VIVE ORIGINALSHTC VIVE ORIGINALS is a content brand owned by HTC VIVE. It is devoted to original IP development andoriginal content production. It also engages in the distribution and exploration of VR in film, art, animation,
music, cultural collections, as well as industries of cultural creativity and entertainment. VIVE ORIGINALS
is also actively building a cross-domain team to create content and VR technical spec standardization.
Moreover, it is aimed at creating content production SOP (standard operation process), and providing an
extended variety of VR solutions. Meanwhile, profit comes from various channels such as licensing for
public broadcasting, organizing exhibitions, and trading for art collections with cross-domain content.
We also actively strive for collaboration with government to garner film and television investments.
Additionally, we want to expand the scale of content, create industrial values, and build up a VIVE Reality
ecosystem by content cluster to fulfill the ultimate goal of enriching human cultural life through newtechnologies and creativity.

HTC DeepQ Healthcare comprises cross-domain experts and engineers in areas such as computerscience, software engineering, medicine, regulations, user experience, design, through virtual reality andaugmented 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 ofhealthcare.

The brand and goal of VIVE ORIGINALS is to “create entertainment experiences with cultural value inthe virtual world for people”. To deepen the connection between the virtual and the real world, our fourpillars of VR technology development can be applied to cultural and art collections, and video and audio
recordings. These pillars are: “Content Production”, “Business Channels”, “Platform Services”, and “Solution
Provision”.

VIVE Arts
HTC launched VIVE Arts in 2017 and kicked off the Global Virtual Reality Art Program. VIVE Arts is devoted
to exploring art and culture ever since it was established. Virtual reality is a new medium full of potentialthat provides people with a different perspective of how to appreciate artistic treasures in the world. The
revolutionary technology of VIVE has changed the way in which people can create and experience art.
For example, VIVE collaborates with museums and content developers to launch their pieces of work inpioneering ways.

VIVELANDVIVELAND is the brand name of HTC VR LBE (location based entertainment) solution provider, foundedin the Syntrend Creative Park in Taipei in October 2016. 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. For COVID-19 protocol, 75%
alcohol is used to disinfect the environment and guests’ hands inside and outside the VIVELAND stadium.
Temperature is also measured so that the guests can enjoy the entertaining activities during the pandemic
period.
In addition, VIVELAND is active in cooperating with developers around the world to develop overseas
markets. In February 2020, after a year of hard work by the team, the operation was successfully expanded
to the Kingdom of Saudi Arabia in the Middle East where a beachhead was established in Khobar in theeastern part of the country. The first VR theme park, Xtra Life, was built in Saudi Arabia in collaboration
with a major local technology distributor, United Electronics Co. EXTRA, covering more than 2,000 square
meters. In line with the booming opportunities in the Middle Eastern entertainment sector, this park willserve as the center or template for when we expand our VR theme park business to other Middle Easterncountries.

023

About HTC

DeepQ Medical Encyclopedia
DeepQ Medical Encyclopedia provides reliable and easy to understand contents which make it much
simpler to the public when reading medical articles. Based on the public’s need, we developed over 1,000
articles in this medical encyclopedia to help readers to know the definition, symptom, cause, diagnosis,
treatment, and medication of the diseases fast and right. Content about health education had been
increased to nearly 1,500 articles in 2020. Wanfang Medical Center and Changhua Christian Hospital System
directly use contents of the DeepQ Medical Encyclopedia, in turn providing customized and accuratecontent about health education to the public through an AI dialogue robot. Going forward, we will innovatewith AI and medical service to build an interactive platform for the public and medical professionals.
https://dzs.deepq.com/

HTC 2020 CSR Report024

Overview of Financial Performance

DeepQ AI Platform
HTC DeepQ Healthare launched a new medical application“DeepQ AI Platform” in September 2019. It is composedwith DeepQ AIP workstation and NVIDIA DGX-1 machines
and is designed to operate in IT environments in hospitals.
It can significantly reduce the learning threshold and thecost of AI training modules through an optimal training
environment, built-in multiple AI modules, automatedparameter tuning, and a simplified user interface. DeepQAI Platform can accomplish tasks in three days that can
typically take up to ten weeks, through acceleration
techniques and system/algorithm optimization. UaaD (Useras a Developer) is a pioneering design concept in medical AI
training modules. DeepQ AI Platform is easy to learn and use. For example, instead of learning to code anddesigning advanced learning programs, doctors would only need to train AI to read X-rays by themselves.
The platform was successfully sold to various medical centers in Taiwan in 2020. Consequently, doctors
can develop AI modules on their own according to their needs in the clinical workflow, to execute clinicalresearch or improve clinical workflow.

AI Natural Language Processing Platform T-BERT
HTC DeepQ launched a new generation of AI natural language processing platform, T-BERT (Taiwan
Bidirectional Encoder Representations from Transformers), enabling computers to read/listen/writein Mandarin, Taiwanese, and Hakka simultaneously, and applies AI on semantic analyses and Q&A
interactions.
The new generation of AI natural language processing platform, T-BERT, uses Transformer networkmodels; from left to right and from right to left, it can read paragraphs and texts bilaterally and analyzes
characters through encoders. Combined with AI acceleration technology developed for Taiwan, DeepQ’s AI
team allows AI to read massive amounts of semantic databases continuously in order to train AI to judge
the meaning which largely increased the accuracy up to 93.7%.
In Taiwan, natural language processing platforms that
support Mandarin, Taiwanese, and Hakka did not exist.
Therefore, HTC plans to release the source of the T-BERT
model and continue to expand the scale to contribute to theacademic community and facilitate industry development.
In the meantime, HTC hopes to gradually introduce thistechnology to product lines. For example, this platform
enables the Taiwan CDC’s Line bot, Disease Control Butler, tosupport Q&A in Mandarin/Taiwanese/Hakka in the future.

025

About HTC

HTC's consolidated revenue for the whole year of 2020 was NT$ 5.81 billion, the consolidated gross profit was NT$
1.56 billion, the consolidated gross profit margin was 27%, the operating income margin was -110%, the net profit
after tax was NT$ -6.02 billion, and the earnings per share (LPS) was NT$ -7.27. 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 2020 as compared to that in 2019. In addition, due to proper cost control in this year
and changes in product combination, the gross profit in 2020 increased as compared to that in 2019. The operating
cost has been reduced as compared to that in the previous period due to the continuous implementation of theausterity policy.
2019

2020

23,74010,015

5,806

37,704

19,865

12,197

Unit

2018

Operating Revenue

NT$ Million

Operating Costs & Expenses

NT$ Million

Income Tax

NT$ Million

5,204

(6)

(4)

Employee Wages

NT$ Million

8,730

6,476

5,267

NT$

0.38

0

0

NT$ Million

0

0

0

Dividends
Social Investment /Donation

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

HTC Product: Smart Mobile and Others (Accessories)
Year

Capacity (thousands)

Output (thousands)

Output Value (NT$ Millions)

2018

7,200

1,673

16,137

2019

6,900

563

5,527

2020

7,300

478

3,413

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.

Product Sales: Smart Mobile and Others (Accessories)
Year

Domestic Sales

Export Sales

Quantity (Thousands)

Value (Millions)

Quantity (Thousands)

Value (Millions)

2018

791

3,432

14,917

19,552

2019

397

1,847

19,385

7,347

2020

168

978

1,559

4,436

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

HTC 2020 CSR Report026

The Pursuit of Brilliance
HTC is an innovation company, creating powerful new products, solutions, and platforms in mobile 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 of smartphones, and are now applying that same innovative approach to connected
devices and virtual reality.
At the heart of this is a bold innovative spirit of pushing new boundaries, while leveraging our industry-leading
capabilities. The notion of Dare to Dream is at the heart of our daily ambitions. We ask fundamental questions
at the intersection 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 creation andinnovation. Because our dreams power the future. Dare to Dream.

Future Goal
Integrate products and services tostrengthen brand-added value.
Create professional images of
products with strong technologicalcompetency to increase market
shares.
Strengthen marketing resources toelevate the brand's image.

As we live this philosophy, we employ powerful technologies and combine them in creative new ways in order todeliver this. At this time in history, building block technologies like VR, AR, 5G, AI, and blockchain are evolving andcoming together in new ways with the potential to deliver utility and experiences previously unavailable. We callthis VIVE Reality.
Today, VIVE Reality is the future that we strive to enable. That means understanding people’s needs and desires,
their hopes and aspirations, and embedding them into the building block technologies of today and tomorrow.
Through creating wonderful devices, content and solutions, we can unleash imagination from the bounds ofreality and realize the true potential of technology for the benefit of humankind. Our future is enhanced in aworld where HTC innovation and VIVE Reality experiences blend to create a new and better world. The threepillars are central to that mission:

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

Current Achievement
Creating a global smartphone with excellent designs

Humanity

The most valuable international brand from Taiwan
The world's first virtual reality system VIVE brings real-world interaction andexperience through space-based positioning 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 ofhealthcare

HTC's
Challenge
How to enhancebrand loyalty

027

About HTC

We endeavor to anticipate the needs of people, businesses and society as awhole, and expand our vision to impact people's lives in ways never before
considered.

Our heritage of and commitment to technology excellence is the great enablerof our pursuit.

Technology

We strive for a world in which customers, large and small, have access to themost powerful hardware, platforms, tools, and services, a world where thetechnology becomes secondary to the experiences that it creates.

Imagination is one of the most powerful tools we know, and one we seek tounlock.

Imagination

A world where a continuum of immersive realities is possible, and experience isunbounded. Imagination that invents new ways to make life better for people
and enable them to be the best they can be, help businesses achieve theirvision, and solve the greater challenges faced by society.

HTC 2020 CSR Report028This philosophy and approach are reflected in a steady stream of world-class innovation, as we continue toadvance new products in VR, mobile, and 5G with greater capability and convenience. We also continue toadvance 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.

Brand Strategy“Quietly Brilliant” is deeply rooted within HTC’s corporate culture. HTC strives to unlock the full human potentialof our customers, employees, partners, and other stakeholders, and to achieve that, we must strive for our corevalues of truth, goodness and beauty in all that we do.

Truth

Truth means being real and authentic. The fields of science and technology are
constantly pursuing truth to solve society's problems through innovation. This is
the most important essence of HTC.

Goodness

Goodness means turning heartfelt ideas into actions that improve people's
lives. Such as, high-quality content that can inspire empathy and compassion,
products that can help people with disabilities, that serve the elderly or educate
young people, and that solve problems for organizations.

BeautyBeauty is simplicity and elegance. The simplest structure can hide complex
details that each have a purpose. We design simple and intuitive user interfaces
for high quality products that evoke a beautiful reaction in our customers.

Only when we launch excellent products instilled with truth, goodness and beauty can we implement our missionof “combining technology with humanity to unleash the imagination”, and achieve our vision of VIVE Reality.

HTC’s approach to brand building is both pragmatic and effective, and is based on principles including:Authenticity: Being authentically true to the nature of our mission, and the belief that we can improve human
lives and experience while creating value.
Entrepreneurial approach: We are agile, attentive to costs, and aim to achieve maximum effectiveness throughan obsessive and energetic approach to building our brand.
Innovative products: For many customers, our products and services are the most concrete expression of ourbrand. By delivering a steady stream of innovation in mobile, virtual reality, 5G, blockchain, and more, we create
proof through action.
Integrated solutions: Far more than just a hardware company, we deliver true solutions through platforms,
software, and services to create positive experiences and net promoter scores with our customers. Our
VIVEPORT store provides access to content, VIVE Studios creates software, and VIVE Enterprise engages businesscustomers with full solutions.
Broader audiences: By continuing to improve and simplify our products and user experience, and support a
broader range of software, we aim to access new customer segments and solve the challenges they have.
Developing the ecosystem: HTC works closely with partners at each stage of innovation to build the ecosystem
necessary to promote adoption, and actively participates in industry alliances to advance our industry thought
leadership. Through the VIVE X accelerator program, we are supporting the development of the ecosystem foradvancing the key and emerging technologies such as VR, AR, 5G, AI, and Blockchain.
We create opportunities to work closely with our portfolio companies to explore mutually beneficial ways
to advance entrepreneurial innovation. VIVEPORT is helping to build an ecosystem of content developers byproviding a dedicated VR app store for consumers and enterprise, while VIVE Wave is enabling other hardware
companies to deliver immersive devices to broaden the market and fuel innovation. At every stage of productdevelopment, HTC considers the requirements of the ecosystem in order to drive the innovation.
Smarter communications: We develop the types of products that people love and want to learn more about,that spark their curiosity and tap into their imagination. These make for great stories and social engagement,
which are among the most effective ways to build a brand, and are a focus of our efforts on that front.
Building communities, forging customer relationships, and offering services that increase lifetime value:
We have moved well beyond the transactional nature of selling consumer electronics to developing an ongoing
relationship with our customers. Through our platform, software, and service offerings, we can continue toengage with them, as well as increase customer lifetime value.

Our vision can best be understood through the VIVE Reality triangle logo mark, which represents the unity of
three key elements – humanity, technology, and imagination – while the center symbolizes a portal to a newworld of experiences that VIVE Reality delivers. VIVE Reality was born from a faith in humanity and forged by arespect for technology, paving the way for bringing people closer together, and closer to their imagination, thanever before. VIVE Reality is stimulating innovation in entertainment, education, training, design, healthcare, art,
shopping and social networking, and many other industries, positively impacting the world, affecting the way welive, learn, and believe.
While we expanded from creating world-class smartphones into the fields of connected devices, virtual reality and
5G networking, we are re-energizing the HTC brand story through the notion of an innovative parent company
that will dare to dream, while expanding our brands to new audiences and segments.

029

About HTCHTC 2020 CSR Report030

COVID-19 Prevention
Management –COVID-19 Prevention Guidelines within HTC
To cope with COVID-19 in 2020, HTC strengthened prevention management from within. Apart from measuring
the temperature of the staff every day, masks are required when having meetings and close-distanceconversations. We strictly control the itinerary of our staff and strengthen sanitary disinfection at the work place
and within the public environment. Every hour, cleaners use alcohol or bleach to wipe the buttons and panels of
elevators, doorknobs of conference rooms, and the tables of the sofa area on the ground floor. Additionally, every
hour, hypochlorous acid water is used to disinfect the interior of elevators. And every two weeks, sterilizers andalcohol are used to disinfect the entire company.
In terms of staff management, besides filling out health statements, Work From Home (WFH) policies and videoconferences are implemented depending on the severity of the pandemic. We separate crowds when staff arrive
at work, thereby reducing clustering and carbon emission from traffic. Staff returning to Taiwan need to bequarantined at home and institute the WFH policy for 14 days. Anyone who has respiratory symptoms and a feverneeds to work from home for 7 days.
HTC is not only responsible for taking care of the health of every staff , but also for giving back to the society. We
collaborated with the Ministry of Health and Welfare of the Executive Yuan to launch the “Disease Containment
Expert Line Bot” with the DeepQ AI platform. The APP is used to help track personnel who are under homequarantine or home isolation to decrease the need for manpower for medical care. The Line chatbot, Disease
Control Butler, launched earlier was upgraded to include several features such as providing information about
COVID-19 prevention, quickly looking up nearby pharmacies and mask inventories, promoting policies andhealth education, display command center news flashes, live stream COVID-19 press conferences, and includes aclarification column for false information, to name a few features. A Medical Natural Language Processing (MNLP)
function was also introduced to analyze key words in conversations and to reply with accurate information.
Furthermore, HTC collaborates with Taipei Tzu Chi Hospital and Taiwan Society of Simulation in Acute and Critical
Care Medicine to establish a “COVID-19 VR Medical Simulation Center’. Thus, students can learn about the clinicalcare of COVID-19 patients, specimen collection and testing, as well as relevant processes. HTC will continue to help
in the front lines of the pandemic with our innovative technologies such as AI, VR, and medical blockchain.

HTC COVID-19 Executive Summary
The outbreak of COVID-19 in 2020 has had a strong impact on the daily life and lifestyle of everyone. In linewith this, HTC drafted a prevention guideline according to the Central Epidemic Command Center (CECC).
We purchased all the necessary materials for prevention measure and requested that all employees, visitors,
contractors, and so on cooperate with these prevention measures. This unprecedented situation can be said tohave been a severe challenge for the chief management.
We appreciated the cooperation of our staff during this prevention period. The prevention management guideline
is as follows:
1. Establish a prevention management team according to the CECC pandemic prevention policy. The Chief Global
Management Officer is to act as the commander to call for contingency meetings and designate tasks according
to the status of the pandemic. A contingency plan needs to be carried out if the pandemic worsens.
2. All personnel with access need to be controlled, including employees at the counters, securities, restaurants,
gymnasium, and so on. Temperature needs to be measured to see if visitors or staff have fever ( ≧ 37.5 C̊ ),coughing, respiratory symptoms such as hyperpnea, or other forms of discomfort. If these symptoms arepresent the person needs to be hospitalized and report to the health center. Everyone has to register theirnames and ID numbers and must sterilize both their hands with 75% alcohol before entering any facility.
Restaurants will be closed if the pandemic worsens.
3. Cleaners will regularly disinfect public areas such as conference rooms, tea and water rooms, restrooms,
elevators, restaurants, and the gymnasium with 75% alcohol, diluted bleach, and hypochlorous acid water.
Staff are also encouraged to use 75% alcohol to clean their tables, chairs, computers, keyboards, mice, and otherelectronics accordingly.
4. The Occupational Safety Department (OSH Dept.) is to coordinate the purchase of relevant inventory forprecautionary measures (masks, ear/forehead thermometers, infrared thermometers, alcohol sanitizers forhands, bleaches, hypochlorous acid water, etc.) based on the decisions of the prevention management team.
5. Provide health management reports, health care education, and counselling channels to the staff. Anyone who
has fever (37.5 C̊ ), coughing, respiratory symptoms such as hyperpnea, or other forms of discomfort need to behospitalized, and report to their direct supervisors and the health center.
6. Staff can apply for WFH if they are required to be home quarantined or self-health monitored according to the“WFH Guideline”.

033

COVID-19 Prevention Management

HTC 2020 CSR Report034

How HTC HELPS: Anti-COVID-19 and Technology
Work from Home (WFH) Guidelines in Response to COVID-19
Because COVID-19 is highly contagious, HTC is determined to protect employees from the disease. Thus, personnel
who are qualified for WFH by the health center can work from home with approval of the head supervisors of theunit.
Conditions for WFH:
1. Those who were exposed to COVID-19 patients.
2. Those who have contact with people at higher risk of COVID-19.
3. Those who are required to be home quarantined or self-health monitored by the government health-supervising
departments.
Regulations for WFH:
1. Work computers need to be on and kept online so that company information can be transmitted.
2. Mobile phones need to be active for conversation and on work mode.
3. Employees need to complete all the installation of necessary software and hardware beforehand, and makesure there is a VPN connection.
4. During WFH (excluding holidays), employees need to follow the rule of the 8-hour working day and finish thescope of their work.
5. During WFH, staff need to follow HTC’s job regulations, Employee Manual, and code of conduct, as well as theinformation security regulations.
6. WFH is to protect employee’s’ health; therefore, it is not suggested to work at a café, library, co-working space,and so on. And it is strictly prohibited to use public internet at the listed locations.
Instant Report:
Reports to supervisor and the health center if employees have any discomfort, enable medical professionals toprovide immediate counselling or assistance.
Sick Leave Policy:
If the employee has any discomfort or does not qualify for WFH, please complete the application process for sickleave.

Human Resource Prevention Measures During the Pandemic
Recruitment: According to the prevention standards of the CECC, masks are required for interviewees andinterviewers. Interviewees need to fulfill the requirements of the Company’s health investigation and fill in
the health statement before the interview. Remote interviews will be carried out with Teams if the pandemic
worsens.
Training: Attendees of offline courses need to wear masks and sit separately during the entire session. Offline
courses will be paused if the pandemic worsens.
Employee Relationships: Collaboration with the health center to ensure the pandemic status and set up acontact window within the HR department to investigate and control manpower of the Company.

Line Bot, Disease Control Butler 3.0 - the Best Helper for Prevention
In 2017, HTC DeepQ collaborated with the CDC to develop a Line chatbot - the Disease Control Butler. It was
upgraded to version 3.0 in 2019. In response to the outbreak of the pandemic, the Disease Control Butler 3.0
provides the following information: the latest news of COVID-19, precautionary measures, quickly looking
up nearby pharmacies and mask inventories, government policies and health education, CECC news
flashes, COVID-19 press conference live streams, and a clarification column regarding false information.
A Medical Natural Language Processing (MNLP) function was also introduced to analyze key words inconversations and to reply with accurate information.
Disease Control Butler 3.0 was reported by TVBS, TTV, CTS, etc., and received a lot of appreciation from thepublic. For example, it received the COVID-19 prevention award, appreciation letters from the Ministry of
Health and Welfare, the 17th National Innovation Award/Pandemic Prevention Innovation Technology, andthe Top 100 MVP Managers of Manager Today in 2020.

DeepQ Healthcare

Disease Control Butler Development Milestones
2017.08
The CDC kicks off
official collaboration
with HTC DeepQ

2018.02
Inquiry for hospitals forflu treatment.

2019.05
Child’s vaccination
potential datearrangement.

2020.02
COVID-19 latest
news.
I would like toknow whereto buy masks!

Any questions
concerning flu
prevention please ask me!

2017.09
Disease Control
Butler was born!
Answering flurelated questions!

2018.09
Q&A for epidemic
status for traveling.
Medical natural
language processing.

2019.06
Personalized flu vaccination alert.

As of the end of 2020, the total number of users for the Disease Control Butler has reached 2.2 million
people.

Business Trips: During the pandemic, domestic business trips need to be approved by the head supervisor ofthe division, and international business trips need to be approved by CEO. It is necessary to report to the healthcenter and receive information about precautionary measures when leaving the country. Home quarantine isrequired by the CECC when re-entering the country. Additionally, reporting to the supervisor and health centeris necessary.

035

COVID-19 Prevention Management

HTC 2020 CSR Report036Disease Containment Expert Line Bot that Helps Officers for Home CareTo cope with COVID-19 and to control the health status of people who are home-quarantined, HTC DeepQ
cooperated with LINE to create the Disease Containment Expert Line Bot, which was launched on April
3rd 2020. The APP can monitor the health status of people who are home quarantined or self-isolating.
Additionally, a bilateral messaging mechanism can be conducted to assist the follow-up work of frontline
officers. People who are quarantined at home can click a link to add this official account when they receivea message from the CECC. After the verification process, they can report their health status through thissystem and receive relevant precautionary information. One month after launching the APP, questionnaires
were distributed to users. Among 7,100 retrieved questionnaires, satisfaction of the APP is up to 8.67 (of atotal score of 10). This indicates that the confidence level of users about this service is high.

“Dr. Lan”, the First Cross-Hospital AI + Blockchain Medical Care Chatbot in Taiwan
HTC DeepQ launched the Medical Care Line Bot, Dr. Lan - the first AI + Blockchain Medical Care LineBot across 10 hospitals in Taiwan. Through DeepQ’s medical blockchain technology can strengthen theinformation security of inter-hospital medical care networks. Everything from AI medical department
guidance, pre-consultation questions, to personal health education after consultation; this combines
medical blockchain information security to begin comprehensive medical care in 10 hospitals in just one
click. It completely upgrades the quality and experiences of the entire medical care process.
Since the outbreak of COVID-19 in February 2020, the Ministry of Health and Welfare adjusted theregulation for online diagnosis for people who underwent home quarantine or isolation, or who could
not go out for medical purposes. Thus, people who are home-quarantined can receive medical services
remotely. Chunghua Christian Hospitals provide remote medical diagnoses via telephone reservation.
Dr. Lan will remind users of the time of the appointment through the Line Bot, and provide the link forthe online virtual ward half an hour in advance. During the process, besides being diagnosed via videoconference, the video will be recorded for the doctors. Because home-quarantined individuals cannot
go outside, families or relatives can collect the prescriptions from the “drive-through” counter with theirnational health ID without having to enter the hospital.

Line Bot — Disease Containment Expert(Home quarantine tracking system)
Report push system

Self-health care

AI medical services/Care Chatbot
Push notification ofquarantine completion

Hospital teamPre-medical /Intermediate-medical/
post-medical service flow chart

Registration
Guidance

Pre-medical service

Preconsultationassessment

Appointment
alert

during medical service

Consultation
guidanceDrugs
administration
management

Healtheducation

Home healthcarepost-medical service

As of the end of 2020, the total number of users for Dr. Lan has reached 17,213 people.

037

COVID-19 Prevention Management

HTC 2020 CSR Report038

HTC, Taipei Tzu Chi Hospital, and TSSACM collaborate to establish a “COVID-19 VR
Medical Simulation Center”
HTC collaborated with the Taipei Tzu Chi Hospital and the Taiwan Society of Simulation in Acute andCritical Care Medicine (TSSACM) to establish a “COVID-19 VR Medical Simulation Center”.
Besides working with the Ministry of Health and Welfare to create AI chatbots, “Disease Control Butler”
and “Disease Containment Expert Line Bot”, HTC also collaborates with the Taipei Tzu Chi Hospital andthe TSSACM to establish a “COVID-19 VR Medical Simulation Center” with VR technology to fight against
COVID-19. With a SimX VR training platform, students can learn about COVID-19 specimen collection andtesting, as well as clinical care in a safe environment. As a result, early deployment can be carried out toincrease health care capacity.

039

COVID-19 Prevention Management

Why is COVID-19 dangerous? Let VR tell you.
COVID-19 is devastating the entire globe. The general public and even experts are in a state of anxiety
because of it. Why is COVID-19 so dangerous? The deputy director of cardiology of Pojen General
Hospital, Chih-Sen Kang, using VR simulation on the TV show “Health 2.0” (https://youtu.be/y-Tc9vdo4Rc),
demonstrated how a lung can be attacked by the virus. He showed the entire process of how the respiratory
system is infected with the virus which attacked the lung tissue and caused fibrosis of the lungs. Fully
covering the mouth and nose with a mask is the most effective precautionary measure for that irreversible
damage.

HTC 2020 CSR Report040

VIVE X Innovation Team Cultivates Education and Science Research: Expediting thedeveloping and learning process of VR to enhance the R&D of COVID-19 medicine
and vaccines
In 2016, HTC established a global XR accelerator VIVE X. It is the most stable yet active global investment
institute in the fields of AR and VR. After five years of hard work, one of the investment start-ups, Nanome,
developed a software that accelerates the R&D of computational chemistry and medicinal chemistry. The
platform they developed enables researchers to be more intuitive when they deal with large numbersof data. In the past, researchers could only operate on a 2D interface. However, now not only can they
process data in 3D virtual space, but they are also able to coordinate and share this remotely with otherpersonnel. We know that researchers in Ontario City in the USA, pharmaceutical companies in Italy, as wellas government labs in Austria are using this to conduct the R&D of medicine and vaccines for COVID-19.

VIVE Sync-Online Virtual Meetings
In 2020, COVID-19 pushed all commercial activities from the offline sphere to the online. Apart from videoconferences, more enterprises consider conducting meetings through virtual reality. Online meetings
provide much convenience for the internal communication of companies. Nevertheless, this is still notenough for services or products that require physical experiences or onsite introductions. Thus, HTC
launched the VIVE Sync, online virtual reality conference service to help enterprises present the benefits ofproducts more vividly with VR technology. It also provides a new communication solution for people whoneed to work from home, as well as providing a precautionary measure to decrease movement during the
pandemic.

HTC VIVE Infinity Supports Prevention, Virtual Sports Increases Immunity
Infinity is the first VR unlimited subscription plan in the world. You have unlimited access to hundreds of
VR games, applications, and videos with all kinds of exclusive discounts. During the time of the pandemic,
HTC provided one month of free access to VIVEPORT Infinity from February 19th to March 31st, 2020 tothose who have to work or study from home. This is to help people ensure that they can continue with theirworkout routines to increase their immunity and maintain their physical fitness. Unlimited downloads
of more than 600 games and applications are available to users. Through virtual reality, consumers candevelop exercise habits without the limitation of space.

041

COVID-19 Prevention Management

HTC 2020 CSR Report042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 dedicated teamQuality and Sustainability Management forformulating CSR policies, drawing up related
action plans, performing cross-department
coordination, and handling communication with,and feedback from, the external stakeholders andour key suppliers.
The annual CSR performance and next year
execution plan will review by the Auditing
Committee under the Board of Directors at least
once annually.
We use clear organization and work breakdowns
through interdepartmental meetings to integrate
CSR work into the management of related
departments, such as legal affairs, compliance,
environment, procurement, human resources,
and marketing, to activate overall CSR andinnovation. This ensures that CSR policies
and measures are an integral part of the daily
operations of the company.

The Mechanism for Committee Operation
HTC CSR Committee is responsible for the decisions concerning economic, environmental, and social issues. The
committee discusses CSR objectives of each division and major CSR issues every year. The committee convenes ameeting once a month. In these meetings, each division will report their CSR performance, and their supervisors
are authorized to proceed with the follow-up actions and results. Since December 2020, the Legal department
has joined the Committee to participate in ethical discussions. In addition, the meeting is adjusted to be oncea quarter to enhance the efficiency of this endeavor.Since 2013, CSR operations were extended to the supply
chain. Operations include conducting CSR audits of the suppliers and relevant education training mechanisms.
Furthermore, the CSR department and relevant divisions regularly assess their CSR performance over the fiscal
year. They then compile and publish a CSR report in accordance with the GRI guidelines to ensure that thedisclosed issues cover all major topics.

Structure of the HTC CSR Committee

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 ofour employees, 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 andin this way, 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 activitiesHTC
CSR Committee

Sustainable innovation from creation to development
Sustainable supply chain management
Be a responsible corporate citizen, with the highest ethical standards
OSH

045

Generalaffairs

R&D

Corporate Social Responsibility Mangement

Sourcing

MFG

HR

Legal

HTC 2020 CSR Report046

CSR 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 have been
included in the major issues. In 2020, online survey questionnaires were sent out extensively including employees,
consumer, customers and supplier etc and a total of more than 80 responses were received. 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 wholein accordance with internal considerations, industrial conditions, industrial chain practice, and stakeholders’suggestions, as well as to confirm the impact of each issue. At the same time, HTC attaches great importance tocommunication and interaction with its stakeholders. In addition to setting up various communication channels,
we respond to 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 to join
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, we havedivided 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 been verified
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 Audit Committee of the board of directors at least once a year.

CSR related management system

The Green ProductsManagement System

Green ProductVerification

The Environment
Management System

The Occupational
Safety & HealthManagement System

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. Through HTC's “Hazardous
Substances Management Regulations”, we require our supply partners to comply with theregulations for reducing hazardous substances in products.

To comply with the Restriction of Hazardous Substances (RoHS) of EU, HTC products are sent tothird-party international verification institutions for chemical analysis, ensuring that the products
are free of concerning heavy metals, bromine-containing flame retardants and plasticizers.
The verification on products' energy consumption in compliance with the US Department ofEnergy'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. The new or revised standards in 2020,
include: Eac-RoHS, ERP adp, etc.

We strive to minimize the impact of our operation on the environment. In addition to establishing
the ISO 14001 environment management system, and make sure all our manufacturing sitesaround the world obtain and maintain ISO 14001 certificates. From 2011 to 2020, there were no
penalties for breach of regulations or laws. ISO14001 factory cover rate reach 50%, introduce
environmental awareness through PDCA principles.

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.
The conversion has been carried out in 2020, and the ISO 45001:2018 certificate has beensuccessfully obtained. Through the introduction of ISO45001, the HTC factory has reached thegoal of zero occupational disasters in 500 days.

The Energy
Management System

Personal Information
Management System

Supplier Management047

Corporate Social Responsibility Mangement

ISO50001 inventory the source and amount of greenhouse gas emission according to ISO140641 Standards. The energy management system enables planned energy management to berealized, thereby supporting sustainable operation.

HTC introduced BS 10012 PIMS (Personal Information Management System), which includes
42 management policies and guidelines, such as the HTC personal information protection,
Information security risk inventory and implemented the System in employee education andtraining, product development and design, vendor management, and information security
incident management.

HTC conducts supplier audits in accordance with the RBA CoC Code of Conduct and the HTC
Checklist. In addition to the routine new supplier audits, 2020 will conduct on-site audits on 9
high-risk suppliers.

HTC 2020 CSR Report048

HTC 2020 Material Issues and Boundary
Material Issues and Boundary Identification

2020 HTC Material Issues Matrix

High

Material issue

Training and Education

EnergyEmployment

Market Presence

Emission

Customer Privacy

Economic Performance

Labor/Management Relations

Forced or Compulsory Labor

Information Security

Within theorganization
HQ

R&D
CenterOutside the organization

Investor

V

Supplier

Economic PerformanceV

Environmental

Innovation Management

V

V

Supplier Environmental
Assessment

V

Stakeholder Interest

Diversity and Equal Opportunity

Occupational Health and Safety

Environmental ComplianceV

Indirect Economic Impacts

Socioeconomic Compliance

Environmental Compliance

Effluents and Waste

V

Rights of Indigenous Peoples

Non-discrimination

Effluents and Waste

EnergyV

Human Rights Assessment

Procurement Practices

Impact on HTC Business

Low

Economic

Environmental

Governmental
Agencies

Local
community

V

V

V

V

V
V

V

V
V

V

V
V

V

V

V

V

V

Social Standard
Employment

V

V

Customer Privacy

V

V

Labor Management
RelationsV

Occupational Healthand Safety

V

Freedom of Association and Collective
Bargaining

Forced or Compulsory
Labor

V

Anti-corruption

Customer Health and SafetyVV

Tax Practices

Diversity and Equal
Opportunity

V

V

Socioeconomic ComplianceV

V

Non-discrimination

V

Human Rights Assessment

V

Supplier Social Assessment

V

Supplier Social Assessment

Water Resources Management

Contractor

V
V

Innovation Management

Anti-competitive Behavior

049

Emissions

Local Communities

Materials

Supplier

Environmental Standard

Customer Health and Safety

Biodiversity

Employee

V

Assessment

Marketing and labeling

Consumers

Economic Standard
Information Security

Security Practices

Corporate
customers

High

V

V

V

V

V

V

V

V

V

V

V

V
V

V

V

V

V
V
V

V
V

V

Note: In 2020: Add stakeholder-Governmental Agencies

Social and Education

Corporate Social Responsibility Mangement

HTC 2020 CSR Report050

Diversified Channels for Transparent Information Disclosure

Investors

Significancefor HTC

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

Finance & businessinformation disclosure
Compliance with laws
and regulations

Concern Issues

Operation Status
Corporate governanceRisk management

Enterprisecustomers

GeneralConsumers

The support ofshareholders andinvestors has positive
impact on HTC's
sustainable operation
Through cooperation andproduct development,enhance the company's
value and pursue growth,
gradually improving
corporate sustainable
operation

Customers satisfying with
our after-sales service
is essential to maintaincustomer relations

Employees

Suppliers

Contractors

HTC upholds the peopleoriented philosophy, thekey to maintaining thecompany's momentum
in innovation comes from
employees, which are thecompany's most precious
assetsPartner with suppliers is
an indispensable key tothe continuous growth ofbusiness operations

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

Construction safety &health

Product quality

Pre-sales consulting

Learning & growth

Raw material quality

Service quality

After-service

Price competitivenessPrice competitivenessProduct quality

Working environment/labor conditions

On-time delivery

Service quality

Green products
Carbon footprint/
carbon disclosure

Wage/welfare
Health & safety

Continuously stable supply
Supply chain management

Career development

Compliance with various
regulations

Work-life balanceTechnical capability

Restricted substancemanagement

Governmental
Agencies

Local
Communities

The foundation of the Company
is to build an excellent external
environment for the corporation,
by following the legal guidelines,
cooperating with government
policies, and earning trust,
support, and collaboration withthe government.

Maintain good relations
with the local government
and neighbouringcommunities to enhance
the company's image

Corporate governance

Environmental impact

Compliance with laws andregulations

Shaping the Corporate
image

Innovative products andservices

Economic contribution

Human Rights
Energy and climate change

Social concerns
Public welfare
Cultivation of talent

Cooperation with logistics/
transportation providers to
conduct effective packing

Corporate social
responsibility

Raw material selection

Human rights

Working environment &healthMachine/equipment safety
Carbon management
training and contests

1. Shareholder conference
YearlyCommunication Channels

2. Annual report
Yearly3. Monthly revenue
statement.
Monthly
4. Visiting investors
Irregular
5. Market Observation Post
SystemIrregular
6. Investor RelationshipWebsiteStanding

1. Business review withkey customers (QBR
meeting).
Quarterly
2. Reply to customer
inquiries.
From time to time
3. Customer audit andreplies to customer'squestionnaires.
By customer request
4. Meeting the customer
requirements about
environmental andsocial responsibilities.
By customer request

7. Spokesperson
Standing

Daily ongoing 1. Local service contact
channels in 11 languages
to provide customers withreal-time communication
and assistance.
2. Websites in different
languages for customers
to give feedback and toaccess information ina real-time manner (59established).
3. Dedicated email boxes
for different functions(Support, Copyright,
Security, etc.) to provide
convenient customer
contact with HTC.
4. Automated support
survey invitations
to collect customer
satisfaction feedback.

1. Department quarterly
meeting.
Irregular

1. Supplier communication
conference.
Irregular

2. One-on-one interview
with supervisors.
Irregular

2. Guidance and audit for
suppliers
Yearly3. Annual performanceappraisal/ interview. 2/
Yearly3. Cooperation projectwith suppliers foraddressing CSR andgreenhouse gas issues.
Yearly4. New employee seminar.
Weekly1. Induction training.
Weekly2. Patrol inspection in thefacility.
Daily

1. Official document, E-mail,ons-site Visit.
Irregular
2. Meeting such as Forums,
Seminars etc.
Irregular

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

5. Employee assistance
hotline and mailbox,
Health Center,
Employee Aid Scheme.
From time to time
6. Labor-management
meeting.
Quarterly

5. Immediate corrective
actions in place based on
custome's insights.

051

Corporate Social Responsibility Mangement

HTC 2020 CSR Report052

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 andother 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.

Organization Structure

3. Fulfill the function of the Audit Committee.
4. Respect the rights and interests of stakeholders.

AGM

5. Enhance information transparency.

Board of Directors
Board of Directors
Chairwoman

Audit Committee
Compensationcommittee
Internal Audit

The Board of Directors are elected by stakeholders and aims tomonitor the management of the Company to ensure the longterm benefits of the stakeholders. Additionally, it is committed
to taking care of various related parties including employees,
customers, suppliers, government, and the general public.

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

Male

FemaleTotal

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,and proposing strategies for the reduction of such risks.

<30 (Excluding 30)

0

0

0

30 ~ 50000>50 (Excluding 50)

6

1

7

Total

6

1

7

Independent Directors

Chief Executive Officer

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 is necessary to widen
the scope of independent viewpoints in order to win the trust of the public and the shareholders. During the reelection of directors in 2019, three independent directors were elected according to the provisions set forth in 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 CommitteeCore Products
andServices

055

Responsibility Management

New Platforms
andInfrastructure

Innovation
Research andDevelopment
CenterCorporate
Functions

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 professionaland objective viewpoint. The committee also makes suggestions to the Board of Directors for discussing. For HTC
corporate governance organization and members, please refer to Page 118 in 2020 Annual report.

HTC 2020 CSR Report056

Strict Mechanisms for Avoiding Conflicts of Interest

Audit Committee
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 andfinancial control. The Audit Committee has the right to conduct any appropriate audits and investigations, and has
direct communication channels with the company's internal auditors and independent accountants. The Audit
Committee convenes a meeting at least once a quarter. The audit supervisor and accountants should report on
audit and financial statement review results, and report important discussions and resolutions to the Board of
Directors.

Complete Disclosures
HTC is committed to improving the immediacy and transparency of information disclosure. In addition to thetimely 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 organized bydomestic and foreign securities firms to help investors understand more about HTC's financial and businessinformation.
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 https://investors.htc.com/en/

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 and stakeholders can be promptly disclosed.

Press Release, Press Conference& MediaInterview

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

Website Platform
Spokesperson &Deputy Spokesperson

1.HTC has established an Investor Relations Website (in both Chinese and English) throughwhich the investors can access and download the company's financial statements, annual
reports, other financial news, information about investor conferences, and correspondencewith shareholders.
2.In the "Investor Service" section, contact information and electronic forms are provided forinvestors to make contact with the Investor Relations Division by phone or by email.
The Investor Relations Website is continuously maintained and updated with the latest HTC
Company development information.

法人說明會

057

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

Responsibility Management

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” andhas revised the “Operational Procedures for Transactions of Specific Companies, Business Conglomerates, andParties”, “Regulations for Budget Management”, “Regulations for Management of 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 the operations of the board of directors.
And add legal compliance training to the compulsory training courses for new recruits to strengthen the anticorruption awareness of new recruits.
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.
A risk evaluation will be carried out every year, including on the impact related to ethical issues. The Legal andother responsible divisions will provide an advanced analysis according to information collected about anticorruption and ethics. The risk levels assessed these years are relatively low. Thus, those divisions proceeded
to risk management for possible issues, internal trainings, statements of anti-corruption, and control measuresaccording to the processes.
In addition, as clearly set forth in the HTC Employee Manual, involvement in fraud, bribery, embezzlement, andviolation 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. Also, HTC set up an email inbox specificallyfor corruption reporting (anti-corruption@htc.com). Anyone can report via this email with proof, if they areaware of any corruption-related events or infringement of the Company. The identity of the reporter will remain
confidential to prevent inappropriate treatment. There were no corruption related events in 2020.
Report process of corruption is as following,

Report Channel
Any HTC staff found to
be corrupt or partaking inother illegal behavior can bereported through post (No.
88, Section 3, Zhongxing
Road, Xindian District, New
Taipei City, 231), or via email(anti-corruption@htc.com).
Named Report: the reporter
shall provide informationsuch as the name, contact
method, and so on. Clearlystate the facts (people, issue,time, place, and objects), andprovide relevant documents
as evidence.

Case AcceptanceIf the reported content is too
general, unclear, ambiguous,
unreasonable, obviously
slandering, empty, or without
any clues or evidence forinvestigation, it will not be
accepted.
If however, there is a basis forthe claim, an investigation
will take place according to
the reported content.

Investigation
Principles
Investigators are entitled toundergo interviews with thereporter, the accused, andother related parties. They
are also entitled to request
relevant information.
Related investigators shallkeep the investigation
process and the result of thereported case confidential.
It is strictly forbidden todisclose the identity of
the reporter to prevent
resentment against thewhistleblower.

Case Closed
and Filed
Relevant documents shall be
filed after the investigation.
The accused employee will
be punished according to
the Company regulations
if the investigation result isfound to be in violation of
the Company's internal rules.
If the result is a violation of
criminal law, the accused
employee will be transferredto the legal authority alongwith the relevant evidence.

HTC 2020 CSR Report058

Tax Management
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 andcustomers, standards of social and business etiquette for suppliers, travel, conflicts of interest, external part-timejob, 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 the e-Course for promotion.

Comply with the local tax law and the rule of law. Calculate tax carefully and file it before the deadline.

Anti-corruption training rates for Board of Directors andall levels of the New Employees in 2020

Ensure that experienced and professional internal and external personnel are involved in the evaluation anddecision-making of tax-related issues.

GeneralWorkforce

MiddleSupervisors

SeniorSupervisor

Highest Governing
Institution

75

7

0

0

5.85%

0.55%

0%

0%

Number of training recipient
Recipient rate

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.

Number of participants

Course hours(Minutes)

2019

2020

2019

2020

General new employees legal training - confidentiality and antiinsider trading

329

82

36

36

General new employees legal training – intellectual property rights

329

82

38

38

General new employees legal training – patent litigation

329

82

38

38

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 not acquirebusiness or work advantages through improper conduct (such as offering kickbacks, banquets, or other improperinterests). 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 violation of the Integrity
Policy, reimbursement shall be provided by the violating party to ensure that both parties are in line with theIntegrity Policy.

Internal Audit System
HTC has set up our internal audit unit as subordinate to the Board of Directors. The internal unit is responsible forassisting the Board of Directors and management in checking any defects in internal control and in the assessmentof operational efficiency and performance, as well as the accuracy of the financial statements and compliancewith the related laws. The unit also addresses areas that need improvement in a timely manner to ensure internal
control is continuously and effectively implemented. The audit results are used as a basis for the review andamendment of the internal control system to advance sound management in HTC.

059

Responsibility Management

Ensure that information on tax reports is transparent, such as reports to tax authorities in different countries,
master files, and transfer pricing reports.
Trades between affiliate companies shall follow the principles of transfer pricing of OECD, as well as the Base
Erosion and Profit Shifting (BEPS).
Ensure that the corporate structure and trades are in accordance with the commercial substance. The
structuring and trades are not to be aimed at reducing the tax burden.
Utilize legitimate and transparent tax incentives without tax deductions that violate the rules of law.

HTC New Employees Legal Training
Course Content

The Company upholds the spirit of tax compliance and corporate social responsibility. Therefore, we aim to create
corporate value and improve tax risk management. We set out tax management and transfer pricing policies
to establish a sound tax stewardship regulation and culture, as well as an instant management process. The
Company has formulated the following tax governance policies to elevate corporate value, fulfill corporate social
responsibility, and carry out corporate sustainability:

HTC works with tax authorities in different countries in honesty, integrity, respect, and fairness following threepillars: mutual trust, information transparency, and legal protocol. In addition, HTC provides solutions for
major tax issues to help improve the tax system and institution on business environment.

Tax Guidelines
Comply with the local tax law and the rule of law. Calculate tax carefully and file it before the deadline.
Ensure that experienced and professional internal and external personnel are involved in the evaluation anddecision-making of tax-related issues.
Ensure that information on tax reports is transparent, such as reports to tax authorities in different countries,
master files, and transfer pricing reports.
Trades between affiliate companies shall follow the principles of transfer pricing of OECD, as well as the Base
Erosion and Profit Shifting (BEPS).
Ensure that the corporate structure and trades are in accordance with the commercial substance. The
structuring and trades are not to be aimed at reducing the tax burden.
Utilize legitimate and transparent tax incentives without tax deductions that violate the rules of law.
HTC works with tax authorities in different countries in honesty, integrity, respect, and fairness following threepillars: mutual trust, information transparency, and legal protocol. In addition, HTC provides solutions for
major tax issues to help improve the tax system and institution on business environment.

HTC 2020 CSR Report060

Risk Management
Tax and Risk Management
All companies in the group appoint a large-scale local accounting firm for their tax visas, and the company
provides the tax signature accounting firms with annual financial information for tax signature declaration.

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.

Stakeholder Engagement

Management of Operating and Financial Risks

The major stakeholders are tax authorities in different countries. The Company files and pays its taxes inaccordance with the legal regulations of each country. Furthermore, the Company consults with any of the four
major accounting firms or contacts the authorities directly if there is anything unclear or a lack of understanding
about the regulations. For any tax audit, the Company prepares the relevant information and cooperates with the
tax authority after receiving the notification.

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 cost risks
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.
We carefully evaluate all kinds of uncertainties of business operations, and thereafter accordingly formulate
control mechanisms. For example, business continuity planning (BCP) is set up to cope with the uncertainties ofdifferent situations, including risks and opportunities derived, and to increase value-creating ability.
In 2020, HTC foreign exports accounted for around 76% of our total business revenues. HTC’s revenue aredenominated primarily in the US dollars(USD) and Euros (EUR), the manufacturing costs are denominatedprimarily in US dollars, so the significant fluctuations in the international exchange rates may affect the operating
income, operating costs and operating net profits in foreign currency denominations. Apart from effcientmanagement of the quality and payment cycles of its foreign currency denominated accounts receivable, HTC uses
forward exchange contracts to minimize its forex risk.

Privacy protection and information security risk management
Protecting the company's R & D achievements and customer information is the duty and responsibility of all
HTC employees. In order to ensure that information security and privacy protection are fully integrated into theorganization's culture and the company's core values, HTC actively establishes and promotes information security
and personal data protection policies, ensuring that they are in compliance with relevant information security andprivacy protection regulations from various countries.
Under the influence of COVID-19, HTC strictly protects confidential and personal information and continues tocreate a win-win situation among HTC, partners, clients, and consumers. HTC is optimizing “personal information
management system” and “information security management system” to control potential risks. The legal, productsafety, and information security departments are working together as a team to promote privacy protection andinformation security.

061

Responsibility Management

HTC 2020 CSR Report062

Structure of HTC’s personal information management system

Product Information Security
Software Security Control Measures of HTC Products

New personal
Informationcollection

Personal
Information
behavior Inventory

Legal basis

Information
protection Impact
analysis

Legitimate interests assessment
for personal data collection

Security check and problem
follow-ups

Behavior check for personal
data processing

Vulnerability scanning

Privacy andinformation security
protection audit
Management & audit
committee

Penetration test

Risk analysis of privacy impact

Product Privacy and sercurity (PPNS) design review procedure

Product online

Requirement
analysis

Privacy and Information security
monthly report
Annual employee privacy andInformation security education andtraining
Personal Information protection
policy and related guidelines

Outsourcing
and partner
management

Procedures forthe exercise of
Individual rights

Information
security accident
management

Annual privacy protection andInformation security audlt

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) developed by the
British Standards Association for personal information management based on OECD, APEC and data protection
laws, and implemented these policies in areas such as employee education and training, product development anddesign, manufacturer management, and security incident management.
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.

Design andpractice

Test

Supervision andmanagement

Operation

Privacy and security manual

Internet security

Code review

Log and supervision

Product privacy and security design and audit

Post-disasterrecovery plan

Contractor privacy and safety assessment

Security breach patch management

Release product/service

Incident response management
Individual rights of personal data management
Customer use

HTC requires the development team to strictly comply with information security rules from the design stageof products, and provides relevant training on product and information security protection measures to theteam. The training refers to the laws and regulations of different countries, as well as the most prominent casestudies in the industry. Furthermore, the training materials include a lot of knowledge and experiences in
information security which are contributed by HTC’s internal resources. Hence, trainees can easily absorb andutilize this knowledge.
We require all our products and services to go through the product privacy and security (PPNS) design review
procedure. They include the virtual reality system - VIVE, enterpries virtual reality solutions, global VR
application stores and subscription platform - VIVEPORT, 5G applications, smartphones, and data collection,use, processing, and storage on the DeepQ AI Platform. As a result, we can comply with the privacy protection
principles, such as legitimacy and transparency, minimization of data collection, limitations of purposes andstorage, and so on. Therefore, we can ensure the completeness, confidentiality, and accuracy of information.

063

Responsibility Management

HTC 2020 CSR Report064

Structure of Product Information Security

HTC Security Test Platform (STP) Flowchart

Product Security
sub-satellite

satelliteORsatellite

satellite

Dept B

Dept CROM
UploadATS downloads
ROM from RCMS

Flash ROM into
devices

STP performs
security test

Pull and
Upload APK
files to STP

Team1
Team4

Team2
Team3

STP generates

TEST REPORT!

Dept AIn terms of the product security in the structural planning, we have set up security satellites in major development
teams to implement privacy and information security policies more effectively. Besides promoting relevant
policies, the security satellites are highly familiar with the products of their own teams and are requested toparticipate in the PPNS design review procedure mentioned above. Consequently, we enhance the positive
meanings of the effect of the review procedure.
In the design and development of software, HTC publishes a privacy protection and safe software development
manual to assist the development team for R&D and to execute code reviewing in accordance with the manual.
This helps to avoid the involvement of unstable or malicious codes, as well as to ensure that the developed
products comply with the expectations of consumers and clients regarding the privacy and information securityof HTC’s products.

065

Responsibility Management

During the development process, HTC introduced automation instruments, such as information security test andweakness scans to verify our products in case any damage by consumers causes a security breach.
Our management of privacy and information security does not end after the launch of new services or after thepurchase of products. Instead, we continue to work on information security control. We follow up the software
patches for security breaches and provide these to the relevant development teams. We also provide designatedcontacts for external personnel to report information security problems. Additionally, we also equip professional
teams to conduct the assessments and replies - demonstrating our highest concern for consumers’ privacy andsecurity. The most important we strive to ensure is that HTC’s services can be provided to our customers correctly
and continuously.

HTC 2020 CSR Report066

As for information security, HTC follows ISO 27001’s information security standard, and establishes and promotes
all kinds of information security management measures. In this way “security” becomes part of employees’ daily
life. Meanwhile, risk assessments, and privacy and security internal audits are conducted annually. Through theseaudits we can ensure the implementation of management systems and modify relevant policies to lower the risks
in a rolling manner.

HTC Privacy and Security Internal Audit

Lawfulness, Fairness, and Transparency
peopleTechnology
process

Security

Privacy

Limitations on Purposes of Collection,
Processing and Storage
Data Minimization
Accuracy of Data

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 must complete
product security related education, training and test every year.

Confidentiality
Integrity
Availability

Data Storage Limits
Integrity and Confidentiality

In terms of reducing operational management risks and ensuring continuous operation, HTC has focusedon cloudification of key core basic systems and introduced various cloud services to create a cloud working
environment that keeps pace with the times. By utilizing the flexibility and high availability of the cloud, deploy
and disaster recovery can be performed quickly when failure occurs, effectively improving work efficiency.

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.

067

Responsibility Management

Besides protecting information of our corporate users and consumers, “HTC personal information management
system” is also valid for our employees. For example, HTC promotes diverse information security protection
mechanisms to cope with any possible information threat. HTC is also dedicated to delivering important messages
to employees about how to maintain the “information security” during the prevention period. In particular, bystrengthening information security, such as remote connection security, remote video conference security, remotecommunication assistance tool security, system security, network security, physical security, information security,and so on during WFH, we make “security” part of an employee’s life. In addition, in the privacy and information
security newsletter, HTC reminds employees to be cautious about phishing e-mails regarding COVID-19. HTC also
ensures that the personal data of staff who go through epidemiological investigations is processed by specialists
and is well-protected in accordance to the CECC’s “contact-based policy”. Furthermore, we abide by the constraintof data purposes, minimization of data collection, and data deletion principles; this means that all the datacollected for the investigations will be deleted after the storage period is over.

HTC 2020 CSR Report068

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 2020, HTC's rating on the CDP climate change questionnaire reached B level (theinternational average level is C).
In the 2020 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 ofgovernance, objectives, scope 3 emissions, and value chain participation to evaluate the performance of supplierengagement.

Sustainability Management Vision2021-2025

2025-2030

To create low-carbon living circles through corporate
environmental protection concepts based on HTC experience
To help contractors obtain energy conservation and carbon
reduction action labels Reduce power consumption (carbon
emissions) by 5-8%.
Water recycling rate reaches 75%.
Waste recycling rate reaches 80%.

Gradually increase the use of green electricity
Reduce power consumption (carbon emissions)by 5-8%.
Water recycling rate reaches 50%.
Waste recycling rate reaches 70%.

In addition, HTC keep to require our suppliers to respond HTC Suppliers GHG Emission Survey in 2020, 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 2020 reached 98.1%.

Climate-related Financial Disclosure
Framework

A quick look at HTC management of energy and climate change
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.

GovernanceAll the HTC plants have been included in the Taiwan organizational boundary area and have been
subject to inspection since 2009.
Between 2010 and 2015, the HTC plants in China were also included in the scope of inspection anddisclosure and external verification was launched. Electric power was found to be the main source ofemission.
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 thesystem since 2011 in an effort to reach the goal of sustainable management.

Responsibility Management

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 climate change 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. Throughcontinuous performance demonstration, management mechanism promotion and system establishment, as well
as planning at different stages of environmental protection cooperation between society and enterprises, short-,
medium- and long-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 regularorganizational risk assessments, including climate change status, serving as a basis for formulating policies andgoals. The evaluation results are as follows: In the future, the risk assessment mechanism recommended by TCFD
will be introduced to assess specific issues of climate change and to understand potential financial impact.

Indicators andGoals

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 "Sustainability Management Vision and Short-, Medium- and Long-Term Plan" in P.70 of
this Report.
Since 2009, ISO 14064-1 verification statement has been introduced and continuously acquired in order tofully 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.
We are committed to improving the energy efficiency of ourselves and our customers. In addition to setting
carbon reduction goals, waste reduction and water saving goals have also been determined to reduce impact
on the environment.

After joining the Carbon Disclosure Project (CDP), HTC is obliged to regularly report its plans, systems,
and achievements regarding carbon risk and carbon management. In 2018-2019, HTC participate in CDP
Supply Chain program members and invite suppliers to participate in the carbon disclosure.

069

HTC Action PlanHTC 2020 CSR Report070

HTC climate-related risks and financial impact
Type

Climate related risks

Potential financial impact

Responding actions in 2020

Type

Policy and Legal

Transition Risks

The options for alternative materials
were increased to reduce therisk of selecting materials fromsingle source. On the other hand,through large number of purchases,
the purchase cost of related
components was reduced toachieve optimum cost structure.
23 energy-saving projects were
implemented in 2020, which saved
503,925 kWh of electricity.

1. Unsuccessful
investment in newtechnologies
2. Transitioning to lower
emissions technology
3. Substitution of existingproducts and services
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 new practicaloperations and processes

Sustainable design of products,
such as improving energy efficiency,
recycling and reducing harmful
substances, was implemented toenhance the green competitivenessof products.
Improve product applications withan accessory functionality. Easy
replacements and upgrades can
extend the design concept of the
product life-cycle.

Acute risk

1. Decreased revenues due to reduced production
capacity (such as production line shutdown,transportation difficulties, and supply chaininterruption)
2. Labor power of employees is affected, 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 to write-offs,
asset impairment or early retirement of existing
assets, which increases the infrastructure cost

Continued to acquire the ISO 140641 verification statement to fully grasp
the energy use, and implemented
energy management systematicallyin accordance with the ISO50001
energy management system.

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

Chronic risk

Potential
financial impact

Reduce operating costs (i.e.,
reduced costs through the use ofsolar energy)

Continued to use green energy, including
the use of low-polluting energy sourcesand equipment such as solar panelsand heat pump systems. Building a lowcarbon life through the implementationof various energy-saving measures suchas improvement of lightings and airconditioning systems, and the offering of
shuttle buses for work

1. Develop or expansion
low emission goods
and services
2. Development ofclimate adaptation,
resilience andinsurance risk
solutions
3. Development of new
products and services
through R&D andinnovation

Increase revenue through thedemand for low-carbon products
and services
Increase revenue by developing
new solutions that meet theneeds of climate adaptation (i.e.,
VIVE product applications andservices)

The use of VIVE product applications
and services; Use of digital technology
can shorten time and distance, which inturn saves transportation time and costs.
VIVE enterprise solutions help enterpriseusers to expand their businesses, creatinga framework for enterprise users to reachcustomers, develop products and train
employees in the future.

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

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

For enterprise users, we published contents
for applications that are related to training,
health care, sports and education.
VIVE ORIGINALS- combines films, cultural
entertainment and art industries, and iscommitted to the production of originalcontent. We continue to receive subsidies
from the Ministry of Culture.
VIVE Arts- uses cutting-edge technology tocreate unique art and cultural experiencesthat can be enjoyed all over the world. We
continue to cooperate with the world's top
art galleries, museums and artists.

1. Use of recycling
2. Move tomore efficientbuildings
3. Reduced water
usage and
consumption

Reduce operating
costs (i.e., reduced
costs through theuse of solar energy
and recycling)
Increase the valueof fixed assets (i.e.,high-efficiency green
buildings)
Benefits to labor
management
and planning (i.e.,
improved health andsafety, employee
satisfaction), which
reduces costs

1. Participation in
renewable energy
programs andadoption energyefficiency measures
2. Resource substitutes/
diversification

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

Using solar power generation systems, andconnect the power lines of the systems to
the grid to sell the generated electricity backto Taipower, alleviating the power loading
burden in Taiwan and reducing carbon
dioxide emissions.
Measures of electricity and paper-saving in
manufacturing plants.
Paperless daily/weekly/monthly report/
SOP/testing spe with OQC introduced. In
2021, we plan to adjust testing frequency
according to the material quality risks. Thus,
we can reduce the time of equipment andinstrument use. We can save up to 38%
of electricity (about 1121 degrees)/30%
aluminum plate consumption/elongate 50%
lifespan of an X-Ray light pipe annually.

Responsibility Management

Responding actions in 2020
Waste reduction strategy was adopted; continue to reduce waste
generation from the source through classification and waste-reduction
promotion, and take recycling as the first consideration to increase thereutilization of resources.
Continued to promote the management of energy performance throughvarious energy-saving improvement and management programs such as
improvement of building lightings and air-conditioning systems
Recycled water is used for the landscape, which is in accordance withthe effluent standards of sewage disposal. Therefore, the consumption ofwater can be reduced.
SMT scheduling is centralized as double production lines. We saved a
total amount of NT$7,664,298 of nitrogen and electricity a year. HTC
developed relevant production and testing equipment that can effectively
share and recycle jigs and accessories simultaneously. As a result, parts
can be recycled with zero waste.
Through improving production process and quality control, HR
educational training, raw material QA control, jig development andimprovement, automated production and testing, and precision testing,
we increase the product life-span and life-cycle, as well as reducing
electronics waste and damage to the environment. By adjusting trial
production lines, we are able to enhance the production efficiency.

Resilience

Resource Efficienc

071

Climate related
opportunities

Markets

Changes in precipitation
patterns and extreme
variability in weather
patterns

HTC climate-related opportunities and financial impact
Type

1. Use lower-emission
sources of energy

Responding actions in 2020

Technology

Products and Services

Physical Risks

1. Increase of operating costs (i.e., increase ofcompliance costs and costs for raw materials andparts)
2. Writing-off and advance retirement of the existing
assets due to policy changes
3. Increased costs and/or reduced demand for products
and services due to fines and court decision

Potential
financial impact

Energy Source

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

HTC 2020 CSR Report072

GHG Emission and Reduction

Energy Consumption Analysis

Total greenhouse gas emission by HTC was 10,262.5594 t-CO2e in 2020. 2013 continues to be the base year, and thegreenhouse gases inventory in 2020 didn’t exceed over 3% of significance threshold. The majority of emitted gas
was CO2. It is notable that HTC’s GHG emissions contained little percentage of CH4, N2O and HFCs. PFCs, SF6 and NF3emissions were maintained at zero.
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 toimprove 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 environment-friendly coolant R-134a
to further preserve the ozonosphere.

The power used by HTC is mainly electricity. To decrease the use of electricity, we persistently promote various
kinds of energy efficiency management. We achieve energy savings through the improvement of the lighting
and air conditioning systems, and the installation of renewable energy equipment. In 2020, the design on energy
efficiency contributed to 578,281 kWh (2,081 GJ) of reduction, and the total amount of reduction in carbon
emission was 308 t-CO2e which translates into a saving of NT$1,259,685.

Energy Saving and Carbon Reduction Results of Office buildings and Plants
2020
HQ & Plants

HTC GHG Emissions
Total Emission

Year

Unit

2018

2019

2020

Total Emission Scope 1

t-CO2e2,711.7527

552.461

372.0549

Total Emission Scope 2

t-CO2e21,027.7191

12,601.900

9513.1854

Eco-Efficiency Value

NT$

1

0.76

0.59

Total Emission Scope 3

t-CO2e699.0291

1,657.927

377.3191

Emission: CO2

t-CO2e21,421.7374

14,417.127

9,602.0662

Emission: CH4

t-CO2e494.8250

353.032253.5848

Emission: N2O

t-CO2e0.6854

0.186

Emission: HFCs

t-CO2e1,822.2240

41.943Emission coefficients

1. Power Conversion CO2 equivalent emissions are calculated in accordance with the power
emission coefficient(0.509) 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 and Taipei Offices.

GWP(Global Warming Potential)

2017-2020 based on IPCC 2014 5th Assessment Report.

31,992.48

H Building

75,610.74

Taipei office 1

21,295.04

Taipei office 24437.43

Total

133,335.69

The Eco-efficiency Value of HTC
Unit

Electricity

0.344529.2448

Scope 3

Unit

2018

2019

2020

Shuttle Bus

t-CO2e170.486

149.197

72.0351

Rubbish Truck

t-CO2e50.87320.93226.7939

Business Travelt-CO2e477.670

1,487.798

276.9665

Responsibility Management

TY3 Building

Environmental
Indicators

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

073

Total Use of Electricity (GJ)

2018

2019

2020

1,000 kWh/Year

37,95623,49519,996

Operating revenue

Million(NT$)

23,741

10,015

5,806

Eco-efficiency value

NT$

0.63

0.43

0.29

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 2020 is the HQ & Plants and Taipei Offices.

Energy-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 wasteof energy caused by bad habits or incorrect information.

TargetConserving
electricity

Reducing carbon emissions

Achievement Rate

HTC 2020 CSR Report074In order to achieve the goal of saving 1% of electricity consumption, energy management has become our key
energy saving direction. Since the manufacturing center and the factory facilities and computer rooms are theplaces where equipment energy consumption is concentrated, different energy-saving strategies and measures
are adopted according to the conditions of each plant.
Targeting the HQ & Plants area, HTC plans to build a new energy management system. Through the additional
monitoring system, the energy-consuming equipment inside buildings can be monitored. Through monitoring,
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 analysis of the monitoring
system big data, continuous energy conservation improvement can be made. In addition, according to theequipment deployment and operation time during factory working hours and off-work hours, the equipment isturned on and off according to the automatic scheduling. This project was completed in August 2019, and energyconsuming equipment was included in the centralized management of the monitoring system to achieve the goalof continuous energy saving.

2020 Energy Saving and Carbon Reduction Results
Energy Savings in Amount of Money
kWh
Saved in NT$

Program
HQ & Plants
Air handlind unit energy saving in H-1F C stairs

1,234

3,702

658

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

3,089

9,266

1,646

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

79,358238,075

42,298Wharf mercury lamps replaced by LED cast energy-saving lamps in
TY3

2,160

6,480

1,151

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

20,16060,48010,745Lighting change from T8 to LED in H-7F

43,956

131,868

23,429Energy saving solution of FFU fan in maintenance room in TY3- 5F

2,925

8,775

1,559

Air handlind unit energy saving in H-2F C stairs

8,580

25,740

4,573

528

1,584

281

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

5,832

17,496

3,108

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

864

2,592

461

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

1,074

3,223

573

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

1,074

3,223

573

14,40043,2007,675

Fan Coil Unit energy-saving solution of toilet in H-1F A stairs
Real-time information
monitoring system

Power
resources

AC System

Lighting
systemSingle line
diagramIce water
systemMeter
overview

Cooling water
systemDetails

Small fans

UPS

Air conditioning
boxes

Electricity
reportTwo-wire
control

Tap water

Water
resources

SewageAir supply
and exhaust

Lighting change from T8 to LED of toilet in TY3
Gas system

PublicsystemParameter
setting

Air pressure
systemNetworksystemEnergyanalysis
Generator

Exhaut gas

AlarmsystemHot spot
analysis

Real-timealart
Alarm record

Exhaust System update of toilet in TY3-4F

9,316

27,947

4,965

CHP5 ice water pump energy saving scheme in ice machine room in
H-B1

64,454

193,363

34,354

Lighting change from T8 to LED in TY4-2F~4F

10,08030,2405,373Lighting change from T8 to LED of Stairwell in H building

15,12045,3608,059

Lighting change from T5 to LED of Underground Parking Lot in
P-B1F~B3F

84,288

252,864

44,926

Exhaust System update of toilet in TY3-5F

10,74232,227

5,726

144

432

77

Exhaust System update of toilet in H-1F C stairs

2,744

8,232

1,463

Energy saving scheme for secondary ice water pump in ice machineroom in H-B1F

111,060

333,180

59,194B2F UPS machine room- split-type air conditioner replacement

32,10596,315

17,112#1, #2 Elevator machine room- split-type air conditioner replacement

33,724

101,172

17,975#3, #4 Elevator machine room- split-type air conditioner replacement

19,27057,81010,271

578,281

1,734,846

308,226

Exhaust System energy saving of male toilet in TY3-6F A stairs

Taipei Office 1

Boiling watercollecting

Total
Building H

075

Responsibility Management

Carbon Emission
Reduction in KgCO2e/kWh

Building TY3

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 2020: 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

HTC 2020 CSR Report076

The Use of Green Energy

Results of Online Meeting on Carbon Reduction

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.

In response to COVID-19, our meetings were all changed to online conferences using Teams in 2020. Around
37,552 online meetings were held in 2020. We are able to reduce about 24,784.32 kg CO2 emissions every
year. The largest conference is the year-end party/lucky draw in January 2021. 1,300 employees around theglobe participate in this event online. We estimate to reduce 30,776.8 kg CO2 carbon emissions due to thetraffic reduction of this event.

RegionAttendee No.

Estimated Distance (Km)

Carbon Emission (kgCO2)

ASIA

4

1,000

292.0

CN

64

500

2,336.0EU

24

10,00017,520.0

TW

1,161

68

992.8

US

11

12,0009,636.0

Total

1,264

Responsibility Management

Descriptions

Solar panels

1. Taipei Office 1 has solar panels that generate electricity used for lighting the staircases
and basement in 2012. The cumulative total number of solar panels since it was built hasreached 117,276 kWh, including 13,918 kWh in 2018, 11,418 kWh in 2019 and 14,963 kWh in
2020.
2. Taoyuan plant is set to install solar energy system on the roofs; the total capacity is180kW. By means of internal line parallel series, the power was sold in bulk and includedin Taipower supply system to solve the power shortage problem in Taiwan.

Heat pumps for air conditioning

We installed a heat pump system in the Taipei offices to provide hot water for showeringin the staff gymnasium and hot water for cleaning in the kitchen. Besides providing heat, it
can also provide partial cooling energy. The iced water produced during the heat exchange
can be used for air conditioning. This system provides hot water and cold air at the same
time.

Electric vehicles and bicycles

Four Tesla superchargers were installed, and bicycle parking is provided in our Taipei offices.
This encourages our staff to use transportation vehicles with low emissions and high energy
efficiency. The total power charged at the superchargers is 378kW in 2020 (including solar
energy).

R22 refrigeration split system air
conditioners are gradually replaced
by R410A

Traditional R22 refrigeration includes chlorofluorocarbons (CFCs), the culprit of ozone
layer destruction. We gradually replaced the current R22 refrigeration split-system air
conditioners with R5410A refrigeration to save the ozone layer that protects the earth
against most ultraviolet (UV). We replaced two 10 kW dual split-system air conditioners in
2020.

30,776.8

Remark:1.9,388 meetings in 90 days were held. Therefore, 37,552 meetings per year is estimated.
2.An estimated meeting time is one hour. Carbon emission of projectors is about 0.66 kgCO2/1000 W/hr. We can save 24,784.32 kg CO2 emission every year after moving meetings
to online conferences.
3.Around 30,776.8 kg CO2 carbon emission from traffic is saved.

077

Energy-saving program

Electric vehicle charging
area

Solar Power Generation System

Free bicycles for rides

Solar panels at Taipei headquarters

Infrared switch of safety ladderlighting

HTC 2020 CSR Report078

Last two years's Resource Consumption Statistics

Setup of Renewable Energy Devices
Targeting the construction of a new parking shed in the Headquarter,
Year
2018
2019
2020
HTC used its roof to build a solar power generation system, replacing
the metal roof of the parking shed with solar panels, a total
kWh29,464160,240
164,584
generating capacity of 180KW. By means of internal line parallel
series, the power was sold in bulk and included in Taiwan Power
Company’s power supply system, thereby relieving Taiwan’s power load and supply 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 December 2020, the cumulative total power
generation has reached 354,288 kWh.

180kW Solar Power Generation System
Sunlight/thermometer

Parking
shed 130kW
solar power
array

R5485

Parking
shed 230kW
solar power
array

Inverter2

Taipower system

R5485

Parking
shed 330kW
solar power
array

Inverter3
R5485

Parking
shed 430kW
solar powerarray

Parking
shed 530kW
solar powerarray

AC boxWholesale
electric meter

Inverter4
R5485

City water consumption
Wastewater
Total city water discharge

Unitdegree/year

213,237

HQ & Plants

Taipei Office

63,13367,778

Taipei Office- City dedicated sewer
HQ & Plants- Dongmen Creek

River
Metric Tons

153,729

78,211

54,222.4

The amount of rainwater recycled

Metric Tons/year

1,501

NA

2,673.68

Total amount of water recycled/reused

Metric Tons/year

55,09423,741NA%/year

16.32

37.6

3.94

The ratio of water recycled/reused to total
amount of water consumed
Total amount of waste incinerated Information productInverter1

2020

2019
Environmental Indicator

Kg/year

Total amount of waste incinerated - General

Kg/year

Total amount of waste reused

Kg/year

Total amount of waste incinerated
Waste disposal expense
Environmental management and recycling
amount - Information productEnvironmental management and recycling
amount - General

13,944
958,273504,306

0

0

0

0

Kg/year170,510

135,700

48.32

NT$/year

1,414,308

828,240

302,400

NT$/year

837,591
3,061,345

NT$/year454,160

0Note:
1.Domestic garbage at Taipei Office consists partly of recycled cartons that are unquantifiable. A recycling company has been commissioned for handling.
2.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 andgeneral rubbish.

PMP350multimeter

Inverter5
R5485
R5485

Parking
shed 630kW
solar power
array
R5485

Inverter6
R5485

Real-time solar information
monitoring system

079

Responsibility Management

HTC 2020 CSR Report080

Innovative R&D Management
Engaging Diversified R&D Talent

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

In 2020, a total of 1,146 R&D workers joined
HTC globally. In addition to those in Taiwan,
we have many R&D employees coming
from, or based in, other countries, suchas Europe, America, and Asia. We expectthat the different cultural backgrounds ofour diverse employees will fuse and fuelinnovative thinking, so as to support HTC in
the development and launch of products thatmeet consumer needs in different regions andwith different cultural characteristics.

Investment in Innovative R&D
Unit

2018

2019

2020

Fixed R&D
Investment

Million(NT$)

7,070

5,652

3,585

Total Revenue

Million(NT$)

23,741

10,0155,806

Percentage

%

30

56

62

Note: The related figures are those listed in the consolidated statement.

Since our establishment, HTC has invested heavily in cultivating R&D talent and developing technical innovation.
Currently, our in-house R&D employees make up 43.99% of all HTC's global employees, the investment of which isabout 62% 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.

Current Achievement
VIVE Pro Eye eyeball tracking upgraded; set a new standard for high-end VR
HMD(Head-Mounted display).
The VIVE COSMOS and the VIVE Reality System has unleashed the unlimited
imagination of the VR world.
HTC collaborated with content developing partners to create a new pattern of
VR content.
VIVE FOCUS won the gold medal of IDEA 2018 (2018 International Design
Excellence Awards).

TaiwanOthers2020
R&D Staff(Number of Persons)

1,146

VIVE Pro Eye won the “CES 2020 Innovation Awards”.
VIVE Cosmos series won “Fast Company Innovation by Design Awards”.
HTC collaborated with Chunghwa Telecom to launch VIVE Sync- the VR virtual
conferences with 5G network featuring high speeds and low latency.

HTC's
Challenge
Expediting patent layout
Strengthening advertisingof product innovation

081

Responsibility Management

Taiwan Others

Taiwan Others

2019
R&D Staff

2018
R&D Staff(Number of Persons)(Number of Persons)

1,789

1,821

HTC 2020 CSR Report082

Smart Innovative Products

VIVE Cosmos External Tracking FaceplateWith this strength of innovation, HTC has special insight into industry trends and the outstanding capability formeeting consumer demand. This puts HTC always in the lead. In October 2019, HTC launched EXODUS 1S, theworld’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 reliableblockchain application to new customers. Another innovative product is the VIVE Cosmos that can be equippedwith an external tracking faceplate. Therefore, users can easily upgrade this themselves and reduce electronics
waste.

THE FIRST SMARTPHONE TO PUT A FULL BITCOIN NODE IN YOUR
POCKET-EXODUS 1S
The belief of EXODUS is “rebuilding trust, one phone at a time”.
Users’ personal data, likes, and even assets are controlled by large
enterprises. The data is part of our assets; however, it is detainedand even used by the conglomerates to profit themselves. EXODUS
believes in returning data to users, which is also part of the corevalues of blockchain’s “decentralization”. On the other hand, EXODUS
collaborates with partners with the same belief to guard users’ data
instead of collecting it.
EXODUS 1S is the first smartphone with full node function,
which contains a complete Bitcoin blockchain to provide a truly
decentralized experience. Having a complete node is the only way
to realize the full privacy of using Bitcoin and full nodes are the key
to ensure the future development of Bitcoin. EXODUS 1S can makeusers from the emerging economies or those who want to explore
the encryption world to enter this field more easily, helping promotemobile 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 the ability to own their own keys, and now
we’ve gone one step further to allow users to run their own fullBitcoin node. Make it easier for more people to use high-tech methods
to achieve a truly free world.

The design concept of VIVE Cosmos is to create a high performance product with more convenience andmulti-functionality to meet users’ demands of virtual reality. The brand-new VIVE Inside-out tracking
system provides an easy setup without any external positioning devices that can maximize physical spacewith flexibility. You can use it no matter whether you are at home or on the go. The display of VIVE Cosmos
uses a 2880 x 1700 resolution that is 88% enhanced compared to the first generation of VIVE. It alsopresents crystal-clear texts and graphics.
Moreover, an adjustable module design is the core function of VIVE Cosmos. Current VIVE Cosmos users
can choose different combo packs according to the equipment in hand, and upgrade by changing the
faceplate of different specifications and levels. Accordingly, users are able to expand to multiple types offunctions, thereby reducing electronics waste. The “VIVE Cosmos exchangeable external tracking faceplate”
was launched in May 2020, and is compatible with SteamVR basestation 1.0 or 2.0, VIVE Controller 1.0 or
2.0, and supports all VIVE accessories, including VIVE tracker and VIVE wireless modules. Hence, users canenjoy an unprecedented VR experience without boundaries.
The VIVE Cosmos series even won the “Fast Company Innovation by Design Awards” given by the American
heavyweight business magazine, Fast Company. Being able to stand out among all world-class products is atremendous recognition for VIVE hardware design.

083

Responsibility Management

HTC 2020 CSR Report084Protection of IP Rights

Overview of Patent Performance and Outcome

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 brand value.
The protection we put on our intellectual property rights covers four areas: patents, trademarks, copyright, andtrade 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

Organize regular training courses for R&D personnel to promote the company’s intellectual
property policy to establish a correct intellectual property concept.
Encouraging our employees to invent and create.
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.

External

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 andinterests.
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 businessinformation, 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 a confidentiality
contract with specific persons in order to protect business secrets.

085

Responsibility Management

Besides applying patents aggressively to protect the R&D achievements of the Company, we also examine
the portfolio of patents regularly in line with the direction of product R&D. We adjust the portfolio in
accordance to the principle of survival of the fittest, so that we can maximize the patenting budget more
effectively. Towards the end of 2020, HTC owned 8,074 valid patents belonging to 2,262 patent families. 7,845
patents are derived internally from the Company and 229 patents were purchased externally. The numberof inventions relevant to 5G has accumulated to 83 patent families, standing at an irreplaceable position in
the development of 5G and patents in Taiwan.
In terms of prizes, HTC on the list of the Derwent Top 100 Global Innovators in 2020. Because of the awardof HTC for the first time, innovators listed from Taiwan were increased from three to four. In the National
Invention and Creation Award in 2020, HTC employees, Li-Wei Chen, Yen-Chun Kuo, Hung-Yu Chen, andMeng-Sheng Chiang won the golden prize of creation category with their head-mounted display of patent
number D190775. HTC employees, Chang-Hua Wei, Shih-Hsiu Li, and Yu-Chuang Chang won the silver prizeof creation category with their head-mounted display of patent number D194927.

HTC 2020 CSR Report086Customer Management
While HTC makes mobile phones and VR devices 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
HTC makes a promise of “Strict
observation of contractual obligations
and confidentiality commitment” to all
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 and hardware
and software, information related topatents and other intellectual property
rights of customers may be incorporated
into our controlling system. We complete
confidentiality agreements with all
customers and suppliers in advance tomaintain 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 or fromlost data in 2020.
HTC introduced the Personal Information Management System (PIMS) in 2018 to protect personal information
during the product and internal management processes. HTC pays close attention to privacy protection laws
in different countries (such as the EU, USA, Taiwan, China, Japan, Australia, and New Zealand), the relevant
guidelines released by different authorities (such as regulations regarding cookies or other similar tools), andverdicts made in courts in other nations (such as verdicts regarding cross-border privacy rules in European
courts).

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 projectand 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 collect HTC
CSR information for communication and response.

Customer Warranty Maintenance Service Flow Chart, Locations, and Performance
Description
Customer Service Center：
HTC established customer service centers in five continents around the globe; EMEA (Europe, the Middle East, andAfrica), China, North Asia, South Asia, and South America. We provide multi-language services for communicationaccording to different locations so that the communication barriers between HTC employees and customers is
minimized.

Satisfaction survey after receiving customer service:
We invite consumers to participate in our service satisfaction survey after an issue is resolved so that we canunderstand how satisfied our customers are. Moreover, we take the initiative to contact unsatisfied customers andhelp them resolve their issues, to put our promise and goal of understanding our clients into action.

For example, to cope with the California Consumer Privacy Act that was activated on January 1st, 2020, HTC set up
several channels for consumers to exercise their rights, depending on their locations. Besides the exclusive email
inbox provided for consumer rights (including the right to know, delete, and modify consumer data that HTC
possesses), HTC added a customer service line for customers in California. In addition, HTC introduced a users’cookie management center and brought this mechanism to other countries to give the control of cookies or similar
tools back to users to protect their privacy.

087

Responsibility Management

HTC 2020 CSR Report088

Customer Warranty Maintenance Service Flow Chart

Customer Satisfaction Survey
The customer satisfaction survey is used to understand the overall satisfaction level of the consumer experienceof those who recently contacted HTC. The internal benchmark of the customer satisfaction management index isabove 4.0 (scale 1 to 5).

CSAT
customer satisfaction score
4.5
4.4

HTC has 91 maintenance offices and 42 collection offices around the globe depending on the country; for example,
a pick-up and delivery service is available in Taiwan. The services provided differ based on traffic and different
regulations in other countries. For example, the number of days needed for maintenance in different locations
vary according to such.
HTC provides a pick-up and delivery service in Taiwan for a more convenient and swift maintenance service;this service took up to 18% of the total number of maintenance services delivered in 2020. As long as consumers
contact the customer service teams through available contat channels such as email, chat and phone, the customer
service representatives will arrange a pick-up or delivery from or to home, with HTC bearing the shipping
expenses bilaterally when in warranty.
There are various and unique procedures and needs depending on specific country. For instance, customers in
the USA can replace their products with new ones instead of using the traditional repair model. The replacement
model took up to 95% of the total number of repair work done in 2020.

4.3
4.2
4.1
4.0
3.9
2017

2018

2019

2020

TestimonyNote:Calculation Method: The average is calculated by dividing each score with the total number of survey responses.

Customer Service Mechanism Improvement Plan

System Support

System Integration: Introduce a new customer relation management tool, Zendesk. Let supporting
teams in all regions join Zendesk to achieve uniform service efficiency.
Replace 50% of HTC's legacy systems to enhance customer service efficiency and sustainability.
Customer records are now stored in the same place to facilitate the management and tracking ofcases within the company.

Customer Service
Integration/Merger

Customer service surveys correspond to the original ticket numbers of Zendesk.
Questionnaire System Integration: The quality service team will manage all collected questionnaires
with a more systematic processing method.
Execute weekly evaluation between HTC and customer service partners so that partners can shorten
the response time to customer feedback.

Global Reporting
Optimization

Reporting is transformed from manual to automated processing.
This is time-saving as a manual report can take at least four days. The consolidation into Zendesk
reporting tool allows to generate the latest reports at any time.
The work of customer service is dedicated to modifying actions instead of only screening theinformation needed from the original data.

Customer Service
Center Merger

Optimizing the scope of support of customer service centers to improve its efficiency.
Prioritizing the understanding of customers' interests according to their specific language andchannels.
Cultivating the ability of multi-channels, skills, and brands of customer service staff to expand thescope of support.

089

Responsibility Management

In August 2020, an issue related to the online store was discovered in a conversation between a customer
from Australia and a customer service representative.
When this customer added multiple products into the shopping cart on the HTC online store, the system
divided the products to two different carts, resulting in the invalidation of the free shipping policy. The
customer complained that he spent US$ 4,000 to purchase equipment, but he still had to pay an extra
US$1,024 to enjoy free shipping for the accessories. The customer service team resolved the technicalproblems with the internal e-commerce team immediately during that week, offered an extra discount tothe customer, and promised to prioritize his order. In the last email, the customer expressed his satisfactionfor HTC’s service team.

Thank you,I think we can see this event a success story. I was indeed very
depressed at the beginning. But everything is fantastic now!
Thank you for the assistance to solve my problems.
Cheers!John

HTC 2020 CSR Report090

Sustainable
Agenda –HTC
Sustainable
AgendaSustainable
Supplier
Chain

Sustainable
Environment

Energy and climate change
Green facility
Water resource management
Environmental Protection

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, product, and supplier chains” we have
put this concept of environmental sustainability
into action, have positive control, and are
reducing the impact of our operations on thenatural environment.
Note:Energy and climate change related action, please refer “Risk Management”
sectonEducation and Promotion

Sustainable
DesignThe Green Supply Chain
Management System
HTC Supplier CSR Assessment
and Audit
Responsible Procurement

Sustainable
Manufacturing
Process

Enhancement of Energy Efficiency

Environment safety and healthEco-design

Management of waste andchemicalsManagement of hazardous
substance
Active in Campliance withStandards

Green production processes andsmart factories

Sustainable
Product

Taking circular economy
as the direction fordevelopment
Environmentally friendly
with sustainable
packaging

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 the safety andhealth of our employees, HTC has established the exclusively responsible unit for environmental issues and theoccupational safety dept. (OSH Dept.) in accordance with the law, and are responsible for the implementationof the entire safety, health and energy management system. It also assists the various factories in continuing topromote occupational safety and health management and environmental management systems and promotes
environmental protection in an all-around way, the fundamental work of safety and health management andpollution prevention.

Sustainable Environment

Every year, we also formulate an occupational safety and health management plan based on the state of safety andhealth 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 promotionof occupational safety and health information; and the establishment of a system to manage contractors. All thesemeasures 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 smart mobile devices combine new models of operation, life, work, study, and travel involving smart mobile
devices help users save energy 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 energysaving technology to improve the energy efficiency of our products.

Green Plant

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

The factories and offices disclosed in the boundary organization report this year have been established inindustrial and commercial areas after environmental consideration and evaluation. The relevant environmental
protection has been implemented in compliance with local regulations and internal environmental policies andspecifications that have no significant impact on the local ecosystem and animal and plant species.

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

However, we still encourage all our plants and offices to go on with their efforts to beautify the environment. As
for the new buildings, we aim to improve the employee’s working environment through the introduction of green
building design.

1.

We regard environment, safety, health, productivity, quality, and effective energy management with equal
importance.

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 are committed to ensuring the organization establishes and implement a process for consultation andparticipation of workers.

6.

We follow required laws and regulations.

7.

We are committed to give priority to the purchase of green products.

8.

We will continue to practice and improve on our environment, safety, health and energy management
systems.

093

Sustainable Agenda

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, thephilodendron, etc., in the lobby of H Building and TY3 Building in Taoyuan. The 2020 annual management feesfor our green environment maintenance amounts to NT$ 1.26 million which is used to provide a fresh and green
office environment for HTC employees.
HTC 2020 CSR Report094

HTC’s Taipei office, The Golden LEED Certified Green Building

Water Resource Management
The water used by the HTC headquarters and the factory is used by employees for office and life, and the
production lines are all dry processes, so there is no industrial wastewater generated. The wastewater generated
by our facilities is mainly domestic sewage for other cleaning uses and from the washroom and restaurant
wastewater. It will not have the negative impact on any neighboring water body.

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 theresponsibility of environmental sustainability. The fully-integrated energy
management system was utilized to attain a full real-time management andenhance the efficiency of energy use. The total amount cumulated for the
reduction in carbon emission since the inauguration of the building hasreached 16,148 t- CO2e, and including 1,181 t-CO2e in 2020.

Sewage Treatment
We invested NT$ 27,760,000 in building sewage treatment equipment in 2010 and spent NT$ 975,078 on operationand maintenance in 2020.

HTC Description of Sewage Treatment Unit Facilities

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 113 kWh/m2
annually in 2020, which was quite a marvelous result.

Fine sieve pump
Fine sievemachineUnit EUI

Year

2018

2019

2020

Taipei office 1

102.91

114

113

Taipei office 2

170

172

170

187.06

97.20

73.16

Building

HQ & Plants H TY3

Domestic
SewageSewageadjustment tank
LEED gold certification Green
Building Label

Fine sieve after
degreasing

Oil slicktreatment slot

Upper liquid
refluxSurfacedegreaser

Aeration tank

Scum

Quick mixing
tankGreen Procurement

Slow mixingtank

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 asa priority in our procurement specifications to firmly integrate the concept into our daily operations.
In 2019, the amount of green procurement reached NT$ 650 thousand. From 2012 to 2020, the accumulated
expenditure for products with green-product stamp was about NT$ 31.45 million.

Greaseintercepting tank

SludgeSedimentation
tank
Pump
Recyclestorage slot

Activated carbon
filterEntrustedcleanup

Sludgestorage tank

Mid slot

Discharge slot

Watering

SludgeDischarge

Sludge belt
filterSludgeEntrusted cleanup
Note: Sewage management includes managing domestic wastewater of tenants living in the area.

095

Sustainable Agenda

HTC 2020 CSR Report096

To substantiate sewage control, we have implemented daily maintenance and inspection in accordance with the“Procedures for Sewage System Operation, Repair, and Maintenance.” We abide by all the laws and regulations
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 and recycled water
are in full compliance with all the standards.
Domestic sewage is discharged into the sewage sewer. Based on the average concentration of effluent BOD and
COD from 2016 to 2020, 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 604 metric tons, sufficient to replace the use of tap
water for park landscape irrigation and for toilet water use.

Rainwater Storage and Recycling System
HTC has established a rainwater storage and recycling system to collect rainwater for flushing toilets and watering
plants. A total of 2,673.68 metric tons of rainwater was recycled from the Taipei office Building, effectively saving
water resources.

Rainwater monitoring system

The Amount of Water Discharge and Recycled Water,
and the Average Concentration of BOD
Year

Amount of Water
Amount of
Average
Average
Discharge
Recycled Water Concentration of Concentration of(Metric Tons)(Metric Tons)
BOD(mg/l)
COD(mg/l)

The Suspended
Solids(mg/l)

Test of Effluent
Heavy Metals

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.

2020

78,211

23,741

5.15

24.28

6.00

N.D.

NOTE:
1.Tested items of heavy metals: Cd. Cr. Cr+6. Cu. Zn. Ni.
2.The scope of statistical data is HQ & Plants

Sewage Recycling
The domestic wastewater is discharged into the sewer system anddelivered to the wastewater treatment plant. The treated wastewater
is discharged into the Dongmen River, which eventually flows into
the Nankan River. In 2020, the total domestic wastewater treatment
volume was 73,796 metric tons, and the recovered volume from thetreatment of domestic wastewater was 22,136 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.
The Taipei building selected water-saving water equipment, using air
conditioning condensate and recovered rainwater. The overall dailywater-saving rate was 78% (including toilets, urinals, faucets andshowerheads).
Starting from 2012, HTC setup and implemented water conservationplans. We examine results each year to examine whether or not to adjust
the goals. From 2014 to 2020, the amount of recycled water used for
irrigation was 1,012,031 metric tons. It’s about 404 standard swimming
pools (each standard swimming pool is calculated at 2,500 tons)

097

Sustainable Agenda

Water-saving Sanitation Equipment
Effectiveness of domestic
sewage recycling in 2020
Sewage water output(Metric Tons)
Recycled water for irrigation(Metric Tons)
Amount saved (NT$)
Actual wastewater recycling rate

73,796
22,136
287,768
30

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 the amount of water outflow and each faucet can save 77 litersof water a day. More than 12,942,745 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 UnitedStates 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 theinstallation, it has been 111 months up to the end of 2020. Therefore, it is calculated as: 111 months * 231 liters * 500 =
12,820,500 liters. For a total of 126 faucets (70% water saving) have been installed on December, 2020. Therefore, it iscalculated as: 6 months * 231 liters * 0.7 *126 = 122,245 liters.

HTC 2020 CSR Report098

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 2020, the total number of paper saved was 457,500 sheets, achieving the best paper saving
management. Compared with 2019, NT$ 70,673 was saved, which is equivalent to a saving rate of 44.53%

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

ERP System

Through the introduction of ERP and various electronic online approval systems, the process thatoriginally required paper approval is converted to online approval, which not only simplifies the process
and saves time, but also because many forms or signatures do not need to be printed by a printer. To
save paper and electricity bills.

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

HTC Paper-Saving Performance
2018

2019

2020

Paper Use (Piece)

2,010,000

1,027,500

570,000

Paper saving (Piece)

3,017,500

982,500

457,500

Paper saving target

1%

1%

1%

Achievement rate60%

48.88%

44.53%

340,460

127,005

70,673

418

263

219

Year

Amount saved (NT$)
The average amount of paper used (Piece/ Person)

Environmental Policy Poster

Environmental Protection and Safety and Health Education
New employees and on-the-job staff education training in the past 3 years
2020

2018

2019

Person

Total
hours

Person

Total
hours

Person

Total
hours

OSH Dept.

1,499

4,497

-

-

120

360

On board

OSH Dept.

1,499

4,497

-

-

-

-

3

After arriving
at thedepartment ofwork

Equipment
Dept.

89

267

54

162

21

63

General labor safety and healthin-service education training

1

Annual(On-job
training)

On-Site

3,601

3,601

1,694

1,694

988

988

Hazardous chemical use notice1

Annual(On-job
training)

On-Site

1,538

1,538

779

779

458

458

Prevent illegal violations of duties 0.5

Annual(On-job
training)

On-Site

1,978

989

1,583

791.5

973

486.5

Hour

Frequency

Responsible
Unit

Environmental protection andsafety and health education
training

3

On board

Hazardous substance use

3

Operational equipment hazard
notifications

CourseNote:The number of participants in the course “Prevent illegal violations of duties” in performing duties accounted for the total number of employees in Taiwan: 44.6%

099

Sustainable Agenda

HTC 2020 CSR Report100Sustainable Design
Encourage Employees to Carpool
HTC runs a shuttle bus service on many
commuting routes in HQ & Plants andTaipei offices. This transportation
arrangement together with car-poolingmakes it easy for employees to moveto and from work. By cutting downon the number of vehicles travellingto and from the plant the amount ofgreenhouse gas emitted, in the formof vehicle exhaust, can be significantly
reducedAnnual comparison table:
The overall reduction of carbon emissions byapproximately 76,750 KgCO2e (45%) in 2020 comparedwith 2019
2019

2020

Shuttle bus total driving distance

294,523km

165,850km

Shuttle bus total gas consumption

49,087L

27,642L

169,350.44 KgCO2e

92,599.58 KgCO2e

Total carbon emission volume

Annual gasoline consumption and carbon emissions of shuttle buses in 2020
Bus
Wennchin
Taoyuan
Bus

Miles
(km)

total
WennchinOilconsumption Taoyuan
Bus(liters)
total
Carbonemissions(KgCO2e)

Wennchin
Taoyuan
Bus
total

JAN

FEB

MAR

APR

MAY

JUN

JUL

AUG

SEP

OCT

NOV

DEC

Total

9,310

12,635

14,63013,30013,30013,30014,945

13,23013,23011,97013,23013,860156,940

280

380

440

400

400

400

460

420

210

190

210

220

4,010

9,590

13,015

15,07013,70013,70013,70015,405

13,65013,44012,16013,440 14,080 160,950

1,552

2,106

2,438

2,217

2,217

2,217

2,491

2,205

2,205

1,995

2,205

2,310

26,158

47

63

73

67

67

67

77

70

35

32

35

37

670

1,598

2,169

2,512

2,283

2,283

2,283

2,568

2,275

2,240

2,027

2,240

2,347

26,825

5,198

7,055

8,168

7,426

7,426

7,426

8,344

7,387

7,387

6,683

7,387

7,739

87,626

156

212

246

223

223

223

257

235

117

106

117

123

2,238

5,354

7,267

8,414

7,649

7,649

7,649

8,601

7,621

7,504

6,789

7,504

7,861

89,862NOTE:
1.Kilometers per month=kilometers per ride* total rides per month.
2.Fuel consumption calculated as 6km per liter (km per month/6km). (Informaiton Source: Wenn-chin Bus)
3.Carbon emissions per km calculated using the coefficient of diesel fuel of 3.45 L/Kg CO2e. (Information source: 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. (Information source: Google Map)
5.The average daily number of passengers is about 80

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.

Green Marks Obtained by HTC
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,
through the US Department of Energy (DOE) and theCanadian Department of Natural Resources (NRCan),the energy consumption requirements for battery
products

Mobile phones, virtual reality(VR)device, including
Accessories with rechargeable
batteries, etc.

Working with Call2Recyle (RBRC) to properly recycle
used batteries in North America.

Batteries

HTC actively seeks to reduce the use of environmentally harmful substances, through a design concept that
can increase the recycling rate, increase resource reuse, and reduce its negative impact on the environment. At
present, HTC's actual practice of sustainable design of products mainly focuses on the three major directions ofimproving energy efficiency, product recyclability design and hazardous substance management to enhance thegreen competitiveness of products.

101

Sustainable Agenda

HTC 2020 CSR Report102Enhancement of Energy Efficiency
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 Energy-related Products and are approved
with energy efficiency verification by third-party verification companies, and the energy
efficiency has reached the 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 arelower than 0.075W or 0.03W, which has greatly exceeded the standard requirements.

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 the same
regulations in June 2019.

Product

Energy Efficiency

Standby energy consumption
115V

Smartphone(U20, Desire20+, Desire20 pro)Level VI<= 0.03W

Level VI<= 0.03W

Level VI<= 0.075W

Level VI<= 0.03WType
TC P5000

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

TC NE5W
TC NE18W

VR(Cosmos Elite)

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 all electronic productsthat use rechargeable batteries, including mobile phones and notebook computers. Nevertheless, the DOE
regulation focuses on the unit energy consumption (UEC), that is, the amount of electricity consumed
during the charging process must not exceed the limit.

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. Compared to the headsets of VIVE Focus Plus in 2019, the new VIVE Focus Enterprise launchedin 2020 increased the efficiency in terms of 24 hour energy consumption in accordance with the current values
required by legal regulations.

Product

VIVE Focus Plus

VIVE Focus Enterprise

Year

2019

2020

24-hour energy consumption power(Wh)

29.923

26.91

Represented value of UEC
kWh/yr

4.172

2.886

Regulatory limits kWh/yr

4.844

5.137

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 additional energy
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

103

Sustainable Agenda

HTC 2020 CSR Report104

Product Recyclability Design

VIVE VR Products

HTC take waste deduction and resource reuse into consideration from the first stages of product R&D. We evaluate
the recyclability design of products thoroughly through product breakdown and material simulation, and estimate
the material composition and relative recyclability rate of products. In addition, consumers can easily exchange
and upgrade their exchangeable external tracking plate so that they can expand to multiple applications bythemselves, thereby simultaneously reducing waste. As a result, we can reduce and reuse material resources andextend a product’s lifecycle - this is an achievement of optimal environmental protection design.

EU WEEE
Standard
2019 VIVE Cosmos cover55%

Weight(g) 47.3
Recycling rate

2020 Cosmos Elite cover
Weight(g) 97

92.4%

Recycling rate

94.4%

Smartphone – Desire Series

EU WEEE
Standard
2019 Desire 19+55%

Weight(g) 116.4
Recycling rate

2020 Desire 20 pro
Weight(g) 137.7

87.5%

Recycling rate

89.5%

Smartphone – U Series
We give valuable feedback to the R&D team through particular strategies that carry out generic identificationand marking of materials (ISO 11469, ISO 1043), simplification of parts, and easy decomposition design. All HTC
product designs at the current stage and for future products is in accordance with the regulations of productrecyclability rates.
When we design our products, we take into account whether materials are easy to dismantle and recycle. The
new generation of products is heavier because we want to provide more functionality. However, the overall
recyclability rate is higher than the previous generation. Furthermore, third-party authorities verify the material
recyclability rate by dismantling and analyzing the products. The recyclability rate of all our products, including
VR and mobile phones, is largely superior to the standard of the same category set up by the EU WEEE regulations(55%). In the future, as a principle, we will continue to design our new products in the direction of decreasing theweight and increasing the recyclability rate.

105

Sustainable Agenda

EU WEEE
Standard
2019 U12+
Weight(g) 182.88
Recycling rate

80.5%

55%

2020 U20 5G
Weight(g) 210.46
Recycling rate

80.5%

HTC 2020 CSR Report106Phone and Battery Recycling
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 related electronic product recycling program. To
reduce the undue disposal or handling of old mobile phones and the impact of this upon the environment.
1. HTC began operating its own mail back device recycling program in 2020. Customers can contact HTC’s
customer care team and request a free mailing label to send their phone, tablet, or VR headset to ourISO 14001 certified recycling partner for proper disposal. For more details, see https://www.htc.com/us/
recycling/
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 Call2Recyclefor every mobile sold in the United States and Canada. In 2020, the project recycled 3.81 million kilogramsof batteries in the United States and Canada, an increase of 11% compared to 2019. The COVID-19
pandemic and stay home orders impacted Call2Recycle’s rechargeable battery collections, which declinedby 10% from 2019。

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 2020, there was a total of
192,969,707 kg of electronic waste recycled in the Washington state area.

107

Sustainable Agenda

HTC 2020 CSR Report108Hazardous Substance Management

HTC Hazardous Substance Control Schedule

During the initial design stage of products, HTC considers the impact of the production process on the environment
and whether it is harmful to users. Therefore, all the used parts, modules, and materials are on the list of HTC’s
specifications of hazardous substance management. The list covers not only the ten items restricted by the“Restriction of the use of Certain Hazardous Substances Directives, RoHS), but also those flagged by international
environment protection regulations and international customers. For instance, we ensure to enforce the banof PVC, halogen-free of brominated flame retardant, and pollution-free gas, and waste that contaminates theenvironment and ecosystem is not produced during the production process. We uphold the goal of being pollutionfree, environmentally friendly, and sustainable in operation. We also request that our upstream and downstream
suppliers to work together to comply with relevant regulations, to ensure that our consumers are free fromhazardous substances.

2020

Prepare the EU REACH SCIP database declaration

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

Description of the HTC product lifecycle and its different stages

2011

External parts were replaced byalternatives with non-plating process

2013

Banned the use of n-hexane in the process

2017

Strengthen the control measures for plasticizer

Raw materials/parts

Production

Green product design and verification

HTC forbids restricted materials.

Chemical inspection laboratory
in the plants.

International third-party companies do thechemical analysis to ensure products comply
with the EU RoHS regulations; that is, that
products do not contain relevant heavy
metals, bromide fire retardants, and plasticizer.

Waste/recycle

Use

Transportation

International third-party
companies verify that our
products are subject to the EU
WEEE recycle standard.

In accordance with therequirements of energy lossof charging batteries in the
USA and Canada, standards ofpower efficiency in the EU, andinternational safety standard
IEC 62368.

109

Sustainable Agenda

Improvement on packaging
design.

HTC 2020 CSR Report110

EU RoHS-Restriction of the Use of Hazardous Substances
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.
In the Directives, Pb, Cd, Hg, Cr6+, PBBs, PBDEs, and four newly added plasticizers, DEHP, BBP, DBP, and
DIBP are all restricted. HTC had already published the latest HTC Toxic Substance Control List R7 edition in
2018. The content includes ten restricted substances outlined by RoHS, and it enforces suppliers to provide
test reports as necessary documentation for parts approval procedures. In the future, HTC will continue to
pay attention to new entries of legal regulations to ensure our Toxic Substance Control List is updated inline with international standards.

EU ErP Directive of Eco-design Requirements for Energy-using
Products
On July 6th 2005, the European Parliament confirmed a new framework of directives to set mandatory
ecological requirements for energy-using products. On July 22nd in the same year, the new energy-using
product Ecodesign Directive (2005/32/EC) was announced. The Ecodesign Directive EuP was replaced with
the new Energy-Related Products directive (ErP) 2009/125/EC. ErP is the abbreviation of Energy-Related
Products. The EU's Ecodesign 2019/1782 regulations governing external power supply efficiency went into
effect on April 1st 2002.
HTC’s AC adapters have been upgraded to the latest ErP standard in accordance with the regulations of the
new directive governing efficiency requirements for external power supplies. Compulsory new labels are
introduced and energy performance technical documents are required. The new AC adapters will fullycomply with the new directive in the future.

EU WEEE Waste Electrical & Electronic Equipment
WEEE is the abbreviation of Waste Electrical & Electronic Equipment. The major directive numbers include
2002/96/EC and 2012/19/EU. In the Directives, electronics manufacturers in the European Union (EU)shall bear the expenses of scrap recycling, processing, and reuse. Products sold in the market shall havecorresponding labels. Electrical and electronics equipment shall meet the objectives of reuse, recycling, andrecovery (3R).
At the design stage, HTC chooses materials that are easy to recycle and reuse. Besides marking products inthe EU market with recycle labels, products are also verified by third-party companies to ensure that they
are in accordance with the 3R recycle rate. As a result, we can reduce the number of final-stage electronics
scraps to decrease contamination of the environment whilst enhancing the use of natural resources.

EU REACH (Registration, Evaluation, and Authorization of Chemicals)
REACH (Registration, Evaluation, and Authorization of Chemicals) are regulations governing chemical
product registration, evaluation, authorization and limitation. In 2020, 209 SVHC was announced andexpected to enforce products/parts that contain 0.1% SVHC to pass the SCIP (Substances of Concern In[articles or in complex objects] Products) database for more information. This measure prompts the use ofalternative substances to replace hazardous chemicals to further enhance a safer circular economy system.

EAC RoHS
Beginning on March 1st 2020, RoHS certification will be mandatory for electronics and radio-electronic
products that are placed on the market in the Eurasian Economic Union. Products must conform to theTechnical Regulation (EAEU TR 037/2016) – Restriction of Hazardous Substances (EAC RoHS).
Based on the EU RoHS testing foundation, products of HTC sold in Europe and Asia must submit documentscomplying with RoHS to ensure they are in accordance with the local requirements for certifications andEAC RoHS.

Active in Compliance with Standards
All HTC mobile phones are verified by international public certification companies, such as SGS, TUV, and ITS.
Chemical analysis is carried out to ensure compliance with the EU environmental directives. In addition, abrand new international product safety standard IEC62368, entered into effect on December 20th 2020. This new
standard aims at mandating manufacturers to build a safer environment for product design on the basis of known
hazards. HTC has updated to the latest version of IEC62368 for all products in the market with CB certificatesprovided.

HTC requests that our suppliers provide the latest data related to SVHC, and encourages them to reduce theuse of such chemical substances. On the other hand, in order to ensure the application content of the EU
SCIP database that will take effect soon, we will review the overall SVHC performance by verifying products
through third-party certification companies, and supply the investigation results to GSM systems andsuppliers.

111

Sustainable Agenda

HTC 2020 CSR Report112Sustainable Manufacturing Process
Hazardous Waste Management

2020 HTC’s waste disposal methods

HTC’s main manufacturing business is the assembly of smartphones and virtual reality devices. We process anddispose 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.

MeasuresSet up recycling bins and commission manual sorting ofdomestic waste.
Used batteries, light tubes and information technology
objects must be recycled.

Methods

Type

Set up recycling bins and encourage and propagandize staff to sort
domestic waste. The employees recycled 504.307 kg of domestic
waste in 2020.
We have recycling stations for used batteries and light tubes
available to the employees

2018

2019

2020

Waste weight of each unit manufacturing (kg/unit)

0.00070.000440.00074

Weights of each unit recycled (kg/unit)

0.002810.003250.00497

Hazardous waste

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.

Recovery Operations

Unit: Metric tons

Offsite Weight Outsourcing

Descriptions

2018

2019

2020

0

0

0

Recovery

1,771.481

958.273518.25

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

Incineration

415.51

170.51100.64

Domestic garbage

Landfilling

23.56

0

35.06

Waste bakelite

kitchenleftover179.997146.343

57.513

The amount of leftover is calculated on a barrelof 189 kilograms.

Preparation
for reuse000Recycling000Preparation
for reuse
Non-hazardous waste

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 throughinspection 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 the information on
the company's website to ensure that we respond and handle it promptly.

HTC Waste Statistics

Recycling

Other

-

Chemicaltreatment

0

1.785

0

C0110- Harmful waste liquid containing copper
The chemical treatment shall be conducted
once every two years for the treatment
according to "Methods and Facilities Standards
for the Storage, Clearance and Disposal ofIndustrial Waste".

2.17

C0301- Harmful waste liquid
The chemical treatment shall be conducted
once every two years for the treatment
according to "Methods and Facilities Standards
for the Storage, Clearance and Disposal ofIndustrial Waste".

Other
Chemicaltreatment

0

2.78

Note:
1. The computer host and screen are estimated based on the weight information obtained from the official website.
2. Preparation for reuse: Checking, cleaning, or repairing operations, by which products or components of products that have become waste are prepared to be put to use for the same
purpose for which they were conceived
3. Recycling: Reprocessing of products or components of products that have become waste, to make new materials.

113

Sustainable Agenda

HTC 2020 CSR Report114

Waste Reduction, Recycling and Reuse

Flow chart of activities for significant waste-related impacts in 2020
306-1

UPSTREAM INVALUE CHAIN

Materials mining & production
306-1

Ptoduct components

OWN
ACTIVITIES

HTC
306-3

306-3

Non-hazardous waste

Hazardous waste

306-1

HTC waste reduction strategy involves the reduction of the generation of waste from the source by means ofsorting 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 number of other licensed contractors are
employed to recycle other material and much of the waste is purified and turned into industrial raw material.
Other waste goes through physical classification which increases reusability. For example, the source control
strategy is adopted when the recyclable plates and sponges can be recycled to the production line for reuse. The
material that is not recyclable goes to a final destination. We also publish the condition of temporarily stored
waste material on the Internet. Our recycled resources reached 643.753 Metric tons in 2020.
From 2011 to 2020, a series of measures such as sorting and recycling, the money earned or saved by recycling
waste rose year by year to reach NT$1,291,751 in 2020. The waste recycling rate increased from 56.89% in 2011
to 78.80%. By the end of 2020, the accumulated savings and earnings from the recycling of waste had reached
NT$89,306,683.

Products & packaging

Waste Recycling Effect and Rate
306-1

DOWNSTREAM INVALUE CHAIN

OthersConsumption

57.513 Metric tons

306-4

Recycling

518.25 Metric tons

million
100

90%

90

80%

80

70%

70

60%

306-4

Recycling

Downstream waste

0 Metric tons

60
306-5

Chemicaltreatment

40(C0110)30

0 Metric tons

20

Landfilling
35.06 Metric tons

306-5

Chemicaltreatment

0(C0301)100.64 Metric tons

2.17 Metric tons

Other disposal
operations

115

Sustainable Agenda

Landfilling

40%
30%
20%
10%

10

306-5

Incineration

50%

50

306-5

Recycling

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Cumulative
Amount of
Recycling inNT$

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

90,144,274

RecyclingRate

56.89%

78.09%

81.02%

84.53%

78.80%

62.64%

65.82%

65.19%

70.72%

74.43%

0%

Preparation for reuse

HTC 2020 CSR Report

116

Kg

million25

4,000,000

HTC Hazardous Substance Process Management Policy

3,500,000
20

3,000,000
2,500,000

15

2,000,000
10

1,500,000
1,000,000

5500,000
0

2012

2013

2014

2015

2016

2017

Total Weight ofWaste Recycling

2,605,450 2,785,082 2,723,339

3,037,885 3,450,697 2,434,060

Cumulative
Weight of
WastesRecycling

2,605,450 5,390,532

11,151,756

8,113,871

2018

2019

2020

1,771,481

958,273643,753

0

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, theR&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 terms of production management, factories regularly conduct hazardous substance tests on materials
according to the “Incoming Toxic Substance Control Work Instructions”. This is done to ensure that thesematerials comply with the RoHS 2.0 requirements, are all non-toxic, and are harmless green products.

14,602,453 17,036,513 18,807,994 19,766,267 20,410,020

X-ray fluorescence analyzer testing heavy metals and halogen elements

Hazardous Substances and Chemical Control
HTC understands that in the green competition between corporations around the world, the active managementof harmful substances and chemicals is the only way to ensure the reliability of the manufacturing process andproduct compliance with the standards of the different countries and customers. In so doing, we reduce thelegal 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 of chemicals used during the manufacturing ofcomponents and parts. These include:
1. Specially-assigned employees make an inventory of the chemicals in the plant on a regular basis. They also haveto inspect the chemicals and ascertain their condition. Including:

TD-GC/MS is used to check plasticizer

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 supplierinternal management systems and an assessment of the risk levels.

117

Sustainable Agenda

HTC 2020 CSR Report118

Green Production Process and Smart Factories

Information system process optimization

A Combination of Human and Material Resources
Our Taoyuan plant provides stable job opportunities, salaries and benefits, as well as an excellent job environmentand opportunities for growth and learning for locals. We comply with the relevant regulations of labor law, create
good interactions with communities, and promote local economic development. We combine human resources
and systems automation to increase efficiency, whilst simultaneously decreasing human capital loss.

Automation
HTC introduced test automation procedures on the product line.
We use robotic arms to test different functionalities using theappropriate jigs and equipment to replace traditional repetitive
human operation. By doing so, not only do we elevate test
efficiency, save testing manpower, and operate 24 hours, but
we also lower the margin for human errors in operations or thewrong judgment of testing results. We also introduced the “oneout of ten” random test at the end of plates to enhance testing
efficiency.

Production Line

Manpower saving ratio(Test function)

PCB Plant

80%

System Plant VR
production line

60%

System Plant SP
production line

68%

The process of receiving company products is adjusted to lead to electronic sign-off for material requisitions, andthe concept of proper storage of company assets shall be strengthened. All products of the receiving company
shall be in accordance with the standard process, and must be registered by the custodian for safekeeping. The
custodian shall apply for the return or disposal of products after use. If this is not done, the custodian must bear
the responsibility of storage or reparation of those products. In order to reduce manual upload errors and improveaccuracy, each system process has been combined and officially launched. This can speed up the production
process and reduce the waste of manpower.

Smart Lamination Factory
Lamination factory is responsible for the installation, calibration, and functionality tests of the headset, VR
HMD Tube, in the class 100 clean room. In 2020, we gradually developed and introduced the automatedblowing and Tube post-optics inspection equipment, in the search for higher production efficiency andlower production costs. We successfully made a big step in production automation.

The Lens/ Tube/ Cover Automated Cleaning Equipment
During the installation process of the VR
tube, low fraction detection of foreign
objects is highly important. Before theinstallation of the tube, we conduct a 100%
manual dust blowing of the raw materials.
After we introduced robotic arms for the
dust-blowing procedure, it saved production
costs up to NT$ 132,603/month (NTD$
1,591,236/year).

The LCD/ Tube Automated Testing Equipment
After the tube is installed, it requires a
100% functionality test. We introduced
automated testing equipment and enhanced
the production efficiency and lowered
the demand for 15 operators. We saved
production costs of NTD$ 132,603/month(NTD$ 1,591,236/year).

119

Sustainable Agenda

HTC 2020 CSR Report120

Control Center
The control center shows instant testing statuses and defective conditions of various products and testing stations.
It also shows specific equipment environment calibration displays and warning notifications. We continue toexpand functions, such as equipment traceability, maintenance records, and instructions.
2020 Online Function Description: Provide instant testing status, defective fraction information, and certain
equipment environment calibration display warning notifications.
2021 New Functions: We expect to add large screens on equipment, add maintenance records, and instantremark function of the maintenance equipment. We also expect to provide warnings of repeated testing
problems to the engineers to ensure better understanding of the machines.

Material Recycling And Reuse
Through the recycling and reuse of materials, we saved a total amount of NT$161,960 in 2020.

Materials recycled in 2020

Materials saved from reuse in 2020

Material

Quantity

Material

Aluminum plate

1,330kg

Synthetic stone carrier(used on M/B production)

200

Tin solder paste

51.77kg

Synthetic stone carrier(used on FPC production)

150

Tin dross15.44kg

Steel plate

138

Quantity

Production Line Combination And Energy Saving Plan
We centralized the SMT scheduling and production with double production lines. We saved a total amount of
NT$7,664,298 on nitrogen and electricity a year. HTC also developed relevant production and testing equipmentthat can effectively share and recycle jigs and accessories at the same time. As a result, parts can be recycled withzero waste.

Improvement of Production & Enhancement of Yield Rate
Through the overall improvement of the production, quality, personnel educational training, raw material quality
control, jig improvement, production automation and testing, and precision testing, etc., we increased the life andlifecycle of products, and decreased electronic waste that damages the environment. In addition, we increased the
production efficiency through trial production line adjustments.

Energy and Paper Saving Measures
Paperless daily/ weekly/ monthly report/ SOP/ testing specs with OQC were introduced. Around 15,000 pieces of A4
paper (70kg) were saved annually. In 2021, we plan to adjust the testing frequency according to material quality
risks so we can reduce the time taken to use equipment and instruments. Annually, we can save up to 38% ofelectricity (about 1,121 degrees), 30% aluminum plate consumption, and extend the lifespan of X-Ray light pipes by
50%.

121

Sustainable Agenda

HTC 2020 CSR Report122Sustainable ProductTaking circular economy as the direction for development

Environmentally friendly with sustainable packaging

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 thatmaximum efficiency can be generated and the effectiveness can be maintained within the industrial system toachieve sustainable operation. The following are some of our practices

The packaging material used for HTC smartphones is subject to product safety and appearance requirements.
We take into account the impact of packaging material on the environment. We uphold the promise ofbeing environmentally friendly and sustainable. Thus, we make efforts to reduce product packaginge. Ourconsiderations include:

Easy to recycle product design

Reduction of the amount of material used;

Extend the lifetime of products, including continuous software updates and good after-sales service

1.The use of biodegradable raw material;

Use recycled materials for manufacturing and packaging

2.Printing with environmentally friendly ink (soy ink);

Reduce the environmental impact of the manufacturing process, use recycled water and renewable energy
Innovative business model, launching HTC VR rental service

Carbon Footprint and Lifecycle Assessment Related Planning andReporting Memorabilia

3.The facilitation of shipment;
All the packaging materials for HTC products are compliable with the EC directive on packaging (EU 94/62/EC) andthe 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.

HTC has been conducting product environmental impact investigation and analysis in accordance with life
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 the Industrial
Development Bureau MOEA and completed the Environmental Protection Declaration (EPD) with 19
suppliers.

One pallet can carry more packs and help reduce freight

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.

Material

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 by providing
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 2020 reached 98%.
8. In 2018/2019, HTC join a CDP supply chain program member. In the first year, major suppliers wereinvited to participate in the CDP Carbon Disclosure Questionnaire and the annual response rate reached48%. In 2019, Invited more major suppliers to participate in the survey and the annual response rate
reached 61%.

123

Sustainable Agenda

Weight(g)Recycling Weight (g)Recycling Rate (%)

Chipboard

96.9

82.4

85

Others (such as calendered paper, PET membraneof plastic bags)

96.2

0

0

Sum

193.1

82.4

42.7

Weight(g)Recycling Weight (g)Recycling Rate (%)

Clay-coated paper

445

378

85

E flute

787

708

90

Others (white cards, plastic bags, PS Tray)

478

0

0

Sum

1,710

1,087

63.5

2020 VR Packaging Material Analysis
Material

HTC 2020 CSR Report124Sustainable Supplier Chain

History of HTC “Sustainable Packaging”

WeightHas been reduced, helps toreduce CO2 emission resulting
from transportation.

Transportation

One pallet can carry
more packs and help
reduce freight.

The material of VR packaging- Utilize recyclable packaging materials and lightweight design
Photo & Dimensions

2015

Weight(g)The number ofpallets

3000

Rigid Box

574x420x212mm

2016
415x295x181mm

2017

2018

21.11

418x338x188mm

Sustainable Agenda

Reduce printing with ink.
Extremely simplified
packaging design

30pcs

14.73

Pizza Box

125

Reduce printing with ink.
Share to reduce thegeneration of new
packaging materials.

HTC follow the Responsible Business Alliance Code of Conduct and formulated an “HTC Supplier Code of Conduct”,
which aims to protect the environment with our supply chain partners, safeguard the human rights of ourworkers, their ethics, safety and health, and extend this social responsibility to the supply chain system. And
organize irregular supplier meetings every year to promote relevant topics.

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 2020,
there were a total of 175 suppliers signed the Supplier Code of Conduct, with the rate of signing reached100%.
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 Code of Conduct,” please visit
http://www.csr.htc.com

Statement on Uyghur Human Rights Issues in ASPI Annual Report2020 ASPI report mentions the HTC’s supply chain factories include p.31/O-Film Technology Co. Ltd and p.34/
Hefei Bitland Information Technology Co. Ltd.

11.26

1570

520x302x182mm

Volume reduced by 55%.
Weight loss by 40%.
Printed with two colors
and reduce the ink use.

20pcs

1200

2019/
2020

Printed with two colors
and reduce the ink use.

24pcs

532x344x185mm

Pizza Box

28.14

16.88

2250

Pizza BoxECO Features

6pcs

1800

Pizza Box

Transportation
Carbon Footprint(kg CO2 eq)

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 67.19%. While demanding high-quality services and products, we also use high ethicaland environmental standards to manage our supply chain.

Reduce inner packaging
with plastic
Use higher recycledmaterials on the outerbox

As a condition of doing business with HTC, we require all suppliers, including O-Film Technology Co. Ltd., tosign the HTC Supplier Code of Conduct and to work with their suppliers to implement these standards. HTC
routinely conducts audits of our suppliers to ensure systems and controls are in place to safeguard against
illegal or unethical activity in all business dealings. In the case of Hefei Bitland Information Technology Ltd,HTC has not had a business relationship with them for several years.
HTC is committed to the highest standards of social, environmental and ethical integrity. HTC fully respects
human rights and workplace rights, and has a zero tolerance approach to worker abuse of any kind, andwe hold all of our vendors to the same high standards of corporate responsibility.
Please also refer to the following link, HTC’s Modern Slavery Act statement, which addresses our concerns
about forced labour.
https://www.htc.com/uk/modern-slavery-act-statement/

24pcs

HTC 2020 CSR Report

126

The HTC Supplier CSR Assessment and Audit

Mid- and Long-term Goals for Supplier Management2020

2021-2022

1. First-tier suppliers sign the "Supplier
Code of Conduct", with a signing rateof 100%2. First-tier suppliers response rate for
the GHG Emission Disclosure survey
form -100%
3. 100% no conflict minerals (3TG)
4. First-tier suppliers response rate for
new conflict mineral, cobalt -100%

1. First-tier suppliers sign the "Supplier
Code of Conduct", with a signing rateof 100%2. First-tier suppliers response rate for
the GHG Emission Disclosure survey
form -100%
3. 100% no conflict minerals (3TG)
4. First-tier Suppliers response rate forconflict mineral, cobalt -100%

2025

In addition to implementing corporate social responsibility of our own brand, HTC also delivers the concept andrequirements of CSR to the supply chain. We established the CSR unit in 2010 and then initiated investigations of
those suppliers who had implemented CSR. This was not only to verify their compliance of the HTC Supplier Codeof Conduct, but also to provide supplier consulting and coaching functions to build and enhance CSR concepts andactions.

1. First-tier suppliers sign andabide by the "Supplier Codeof Conduct", with a signing
rate of 100%
2. Promote first-tier suppliers to
implement power saving: theresponse rate of the supplier
GHG survey form is 100%, andthe supplier’s implementationof power saving rate accounts
for 50%A Quick Look at the HTC Supply Chain Management

Definition of HTC
Critical Supplier2020 Supplier Management
Amount (NT million)

Percentage of Total Purchase Amount (%)

Relation to HTC

A

410

16

None

B

349

13

None

Others

1,872

71

-

Total Purchase Amount

2,631

100

-

Owing to differences of industry characteristics and supplier category, HTC identifies critical supplier andmajor 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 critical suppliers of current year based on different situations every
year.

Self-assessment
SurveyAll candidate suppliers are required to fill in the Self-assessment. Since 2016, theweight 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 check and the results will act as thereference for the supplier screening process.
For new suppliers, the CSR self-assessment questionnaire must be filled andreturned. The content of the questionnaire is designed based on the five major
aspects of HTC's Supplier Code of Conduct: labor, environment, health andsafety, ethics and management system. Supporting information is provided forinspection.

On-site Audit“Supply Chain CSR Compliance Audit” has been implemented since 2011, basedon initial risk determination (including geographic, location, products, news, etc.)
In 2017, added new audit item for the RoHS and REACH directives, hazardous
substances subject to control are required to be audited in the manufacturing
process.
On-site audit for 9 suppliers had been completed in 2020.

Labor Rights

71 cases, mainly about wages and benefits and overtime issue.

Health and Safety

74 cases, mainly on insufficient occupational safety measures in the operating
environment.

Environment

19 cases, mainly about Inadequate hazardous waste management measures.

Ethics8 cases, mainly for the failing of establishing management procedures for
employees to accept inappropriate payments and gifts

Treatment andResponses

In response to the above findings, besides requesting the suppliers to respondwith improvement measures, HTC also provided management system andimplementation experience to suppliers for reference and put them in thepriority list for on-site audit in next year in order to prevent similar incidents fromhappening.

Management
Mechanism

The Green Supply Chain Management System
HTC has setup the Green Supply Chain Management platform since 2006 to assist R&D engineers to select green
materials from the product database that 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.
Since 2018, the CDC (Component Data Collection) subsystem has been added to the Supplier Portal System toaddress the issues required by the Supplier Code of Conduct, such as conflict minerals, banned and restricted
substances, and greenhouse gases Emissions, etc., set the annual supplier targets, tracked and summarizedthrough the system.
The survey of new suppliers shall comply with the HSF scoring standard. As for the existing suppliers, the HSF
performance evaluation was added to the Supplier Performance Management System since 2016. Improvements
are reviewed and checked via the implementation of the quarterly supplier meeting.

127

Sustainable Agenda

On-site Audit Results(Total of 172
Noncompliance
Items in 2020)

HTC 2020 CSR Report128

No conflictminerals productused at HTC in

2020

Responsible Procurement of Minerals

Distribution map of countries where smelters mainly use minerals

HTC has responded to the global boycott of conflict minerals, supports the Conflict-Free Smelter Program, haspromised 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 aconcerted 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 and certification
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 2020, all suppliers also signed an agreement to ban the use of
conflict minerals, which will be updated annually. In response to international trends, HTC began to investigate
the sources of "cobalt" metal mines of all suppliers in 2020, with a response rate of 98.6%.

SWITZERLAND 5.3%
RUSSIAN FEDERATION

5.3%

JAPAN

UNITED STATESOF AMERICA 6.1%
GERMANY 7.0%
KOREA 7.0%

CHINA

Gold

12.3%

OTHERS

37.7%

The intended use of conflict minerals

Au

Point of use
Contact in the circuit boards
Intended use
As circuit board contacts toensure proper connection

W
Ta

129

Point of use
Tantalum-Capacitor
Intended use
An element used intantalum capacitors

Sustainable Agenda

Sn

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

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

Co

19.3%

BRAZIL 9.4%

INDONESIAOTHERS

43.5%

25.9%
Tin

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

CHINA

21.2%

HTC 2020 CSR Report

130VIET NAM

6.7%

RUSSIAN FEDERATION

8.9%

UNITED STATESOF AMERICA

8.9%

OTHERS

Tungsten

CHINA

53.3%

CHINA

35%

22.2%

GERMANY

7.5%

BRAZIL

7.5%

JAPAN

12.5%
Tantalum

OTHERS

17.5%

UNITED STATESOF AMERICA

20%

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 , Kazakhstan , South Africa , Taiwan, Turkey , United Arab Emirates , Uzbekistan , Andorra , Australia , Austria , Belgium ,Chile , Czechia , France , Indonesia , Kyrgyzstan , Mexico , Netherlands , Philippines , Poland , Singapore , Spain , Sweden , Thailand
2. Smelter countries of Tantalum include: Estonia, India, Kazakhstan, Mexico, North Macedonia, Russian Federation, and Thailand
3. Smelter countries of Tin include: United States Of America , Bolivia, Japan , Thailand , Viet Nam , Belgium , India , Malaysia , Myanmar , Peru , Philippines , Poland , Rwanda , Spain , andTaiwan4. Smelter countries of Tungsten include: Germany, Japan, Korea, Austria, Brazil, Philippines, and Taiwan

131

Sustainable Agenda

HTC 2020 CSR Report132Friendly
Workplace –Staff management
Human Rights and a High Standard of Professional Ethics

Overview of Human Resource Structure

HTC is an international corporation, and follow the Responsible Business Alliance Code of Conduct, we attach
great importance to the human rights of labor, and the principle of equality and anti-discrimination is our core
concept for multicultural employees. We provide equal and fair employment opportunities for employees. Thereis no race, gender, age, physical and mental disabilities, religion, ethnicity, or any other form of discrimination
protected by relevant laws.

HTC recruits promising talent from all around the world. At the end of 2020, HTC global employee workforce
totaled 2,605. Of these, 28.69% were foreign supervisors, accounting for the total number of executives worldwide;
foreign supervisors and professionals accounted for 19.21% of the total number of global executives andprofessionals, and 25.93% of the supervisors were women.

HTC is committed to the highest standard of social care, environmental protection, and ethical integrity. We fully
respect human rights and workplace rights. We have zero tolerance of any form of abusive labor conditions. HTC
requires all suppliers to maintain the same standard of corporate responsibility and announces the “Modern
Slavery Act Transparency Statement” (please refer to https://www.htc.com/uk/modern-slavery-act-statement/). We
collaborate with suppliers to abide by the latest statement to embody justice and human rights.

HTC’s turnover rate of direct workers in 2020 was 6.8%*, 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 17.36%, 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 employee

HTC Human Resource Structure Overview

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 and therequirements 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 establishedthe “HTC Code of Conduct” as the prime 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 andlocation, must comply with these ethical standards. In countries where HTC has a manufacturing presence, thisCode is 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 aboutthe HTC corporate policy, the Code of Conduct for employees, ESH policy and corporate social responsibility andanti-corruption, sexual harassment and human right issues such as Prevent illegal violations of duties courses
were also included. An e-learning program for 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 shallsubmit 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 lead to 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 complianceverification for the implementation of the “HTC Code of Conduct” in 2018. The verification was passed andrelevant certificates were obtained. We will continue to improve and practice the Code of Conduct in the future.

Gender

2018

2019

2020

Male

2,679

2,304

1,557

Female

2,131

1,601

1,048

Employees under indefinite
contract

Male

2,641

2,269

1,537

Female

2,105

1,555

1,029

Temporary Employees
under fixed-term contracts

Male

38

35

20

Female

26

46

19

Male

629

359

221

Female

1,212

709

429

Male

2,050

1,945

1,336

Female

919

892

619

Male

2

1

0

Female

0

0

0

Male

35

29

20

Female32

31

25

Global Employee

Manufacturing employees

General employees

Taiwan dispatch personnel

Part-time personnel≤29 years old

%

27.90

23.10

17.27

30~50 years old

%

66.82

70.91

75.28

≥51 years old

%

5.28

5.99

7.45

Note:
1. Employees under indefinite contracts include 2511 general employees, 0 global employees, 32 people in Research and Development Substitute Services, and 23 interns, totaling 2566. Parttime personnel are not included in the total number.
2. The dispatch personnel worked as supportive assistants. No dispatch personnel in 2020

135

Friendly Workplace

HTC 2020 CSR Report136  The Global Distribution of HTC Personnel

By AgeMale

By area

Europe, Middle East
& Africa

America
Region106

196Europe,Middle East &AfricaAmerica
RegionThe Global
Distribution
2019 年of
HTC Personnel
HTC
全球據點
in 2019人數分布總數
Total

84

103

3,905

Asia-Pacific Region

3,603

Europe, Middle East
& Africa

America
Region

2,605

2,418

%

General
Employee%

Middlesupervisor%

Seniorsupervisor

%

≤29

29

1.11

233

8.94

25

0.96

0

0.00

30~50

166

6.37

164

6.30

815

31.29

30

1.15

≥51

14

0.54

4

0.15

61

2.34

16

0.61

Total

209

8.02

401

15.39

901

34.59

46

1.77

Age

Manufacturing
Employee%

General
Employee%

Middlesupervisor%

Seniorsupervisor

%

≤29

26

1.00

122

4.68

15

0.58

0

0.00

30~50

320

12.28

129

4.95

329

12.63

8

0.31

≥51

71

2.73

5

0.19

18

0.69

5

0.19

Total

417

16.01

256

9.83

362

13.90

13

0.50

107

210
Asia-PacificRegionManufacturing
Employee

Female3,905 人The Global
Distribution of
HTC Personnel
in 2020
Total

Age

By Position
The Global
Distribution of
HTC Personnel
in 2018
Total

Year

4,810

2018

Asia-Pacific Region

4,493

2019

By Country
Domestic Personnel

Foreign employees

MaleFemaleMale

Female

2018

2,198

1,603

481

528

2019

1,856

1,285

448

316

2020

1,312

888

245

160

2020

Position

SeniorMiddleGeneral

Total

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

Female

Total

64

1,692

3,054

4,810

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

Total

74

1624

2,207

3,905

Male

46

901

610

1,557

%

1.77

34.59

23.42

59.77

Female

13

362

673

1,048

%

0.50

13.90

25.83

40.23

Total

59

1,263

1,283

2,605

FemaleNote:
1.Senior: CEO, CMO, CFO and other executive positions above Vice GM.
2.Middle: Director, Managers, Assistant Manager, Supervisor and Special Assistant.
3.General: Engineers, Specialist, Leader, Foremen.

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HTC 2020 CSR Report138Care for Foreign Employees

2020 HTC New Recruits of Employees Worldwide Statistics
Age

Unit

Asia

America

Europe, Middle East, Africa

MaleFemaleMale

FemaleMale

FemalePerson

59

42

3

4

0

1

%

2.44

1.74

2.91

3.88

0.00

1.19

Person

35

31

7

4

1

7

%

1.45

1.28

6.80

3.88

1.19

8.33

Person

5

1

0

0

1

0

%

0.21

0.04

0.00

0.00

1.19

0.00

Sum

Person

99

74

10

8

2

8

Total by Region

Person29

30- 50

51

173

18

10

Note: Percentage of new hires by each age range = number of new employees in each category / total number of employees in each region

2020 HTC Turnover of Employees Worldwide Statistics
Unit

Asia

America

Europe, Middle East, Africa

MaleFemaleMale

FemaleMale

FemalePerson

217

165

12

16

2

3

%

8.97

6.82

11.65

15.53

2.38

3.57

Person

532

375

47

16

17

10

%

22.00

15.51

45.63

15.53

20.24

11.90

Person

30

58

11

4

0

1

%

1.24

2.40

10.68

3.88

0.00

1.19

Sum

Person

779

598

70

36

19

14

Total by Region

Person29

30- 50

51

1,377

106

33

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 provisionof 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 the data 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
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 Oct. 2019, based on the decisionof foreign employees, we decided to change the 2020 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. Apart fromhiring translators, administrators and counselors who are skilled in native languages, providing life, language,
culture and mental health assistance. In 2020, a total of 758 foreign employees were counseled. Most issues wererelated to living regulations, such as accommodation, transportation, Epidemic prevention measures, etc.
All contracts of foreign workers are due in August 2020 and HTC helped arrange flights for these employees
to return home. Due to the pandemic, six foreign employees’ flights were delayed or canceled multiple times.
Therefore, in order to support them, HTC provided free accommodation, three meals a day, health education
regarding the pandemic, temperature measures in the morning and afternoon, shuttle services on their departureday, and international shipping until the day they left the country.

The following precautionary measures are conducted in response to COVID-19:
Measuring temperature daily
Disinfecting the dormitory weekly
Promoting pandemic prevention information in line with government policies
Separation of beds and people in the dormitory
Managing cluster contagion risks by filling out forms of contact history when going in and out

Note: Percentage of trunover by age = number of retired employees in each category / total number of employees in each region

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HTC 2020 CSR Report140

Talent Attraction and 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 andcommit 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 the West 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 pursuit of growthand profit, is also committed to helping employees grow with the company. The creation of an environment thatwill help them continue to do this is very important. HTC is guided by business needs as well as personal careerdevelopment. The company strives to provide employees with enhanced professional skills, in addition to assistingthem to seek a good career development direction; HTC has classified talent management and development as animportant management indicator. Employees should improve and grow with 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 skillsof 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 thatare required. After the internship is completed, potential talents will be selected to become the full-time employeesof HTC when they graduated from university.

Goals for
TalentCultivation

Target year 2021
According to the annual training plan signed every year, the actual rateof trainings implemented must reach 95%
For the annual training courses, students’ overall after-training
satisfaction score must reach 4/5

Diversified learning channel

Engaging Diversified Talent

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.
Hold the creative thinking forums, inviting experts from various fields around the world to share industry trends andfuture technology blueprints.
Library (physical and online magazines) and online learning platforms and other tools to encourage employees tolearn independently

HTC offer job opportunities for diversified talents. At the end of 2020, 25 disabled people (weighted) were
employed, which is 3 more than the required number (the required number is 22). In addition to relying ontalent-job matching conducted by the supportive or sheltering bodies, we also allocate jobs in considerationof the characteristics of individual handicapped workers. We can also tailor job descriptions and the working
environment, to allow the handicapped to have the opportunity to prove their abilities. Through education andtraining is also provided to allow the handicapped to make a contribution to society and enhance their own
quality of life.

2018

2019

2020

Disabled employees(male)

31

25

11

Disabled employees(female)

20

17

10

Total

51

42

21

General
Employees

The
Management

Diversified
learningchannel

New Employees

To foster our key leadership teams, we have specially tailored
Leadership Development Framework training for supervisors
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 ensurethat these courses further the daily work of the directors andsubstantiate their leadership and performance, follow-up actionplans are formed for each of these learning courses. These aredevised to assess performance both before and after training, insuch aspects as the supervisor's counseling records, subsequent
presentations, and so on.

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 to work 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 the company.

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HTC 2020 CSR Report142Comprehensive Education and Training
To develop employee capability to meet global technology challenges and grasp the movement of the industry,
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 the five coreoccupational functions and the learning effect is substantiated through a series of diversified channels.

Cultivating Key Leaders
HTC actively promotes company culture in the face of rapid changes in the global industry and new patterns ofglobal enterprise competition and cooperation. HTC quickly adapts to a constantly changing environment andcultivates management talent with an international vision, expecting their excellent managers to become present
and future drivers who will continuously lead HTC towards steady growth and development in times of hardshipand challenge. In 2020, leadership-training courses were given to 158 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

HTC Manager Week
To allow supervisors (management) to learn new ideas and concepts from the best practices in theindustry, change their inherent thinking patterns, and trigger new behaviors or approaches in work andmanagement, we implemented the Manager Week event. In this event, we shared with supervisors articles
that are related to the 3 major management competencies. In 2020, a total of 25 articles have been shared,
allowing supervisors to get the latest management information by reading the shared articles every weekduring 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’s culture
and develop a full range of knowledge and skills
through a variety of physical and online courses.
Newcomers are encouraged to share all kinds ofmatters taking place at HTC with a senior employee,
Newsletter will be sent to colleagues every week
within the month after reporting to work to help
newcomers getting familiar with HTC culture quickly,
and blending into HTC’s big family.

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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 goalthat will both improve their own job performance and coincide with company business policy for the achievementof better performance. This mechanism allows employees to become more proficient at their work through theirown 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 time overthe following months. However, at mid-year and at the end of the year their performance is evaluated by an
immediate superior, in terms of how much of their set goal has been achieved. On the basis of this evaluation, 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 the quality of work and thedegree of cooperation.

HTC 2020 CSR Report144

Thinker ForumWe continue to promote the “Thinker Forum” which is a space for employees to understand new or different
types of knowledge and to expand their vision. Furthermore, in 2020, we invited professor Yuan-Tseh Lee togive a speech on “global warming and sustainability in Taiwan”. In this speech, the professor discussed energy
transformation in Taiwan, as well as helping employees gain the relevant understandings and commitment to thisimportant issue.

Thinker Forum- Global Warming and Sustainability in Taiwan
On August 27th 2020, we invitedprofessor Yuan-Tseh Lee to visit
the HTC HQ and give a speech on“global warming and sustainability
in Taiwan”. The audience included
students of UC Berkeley in Taiwan.
He also experienced our VR products,
such as the Mona Lisa and brain
blood vessel operation. Professor Li
was very complimentary of HTC’s
developments in the VR industry.
The scope of his speech covered thefollowing topics: global warming,
the supply and demand of human life, and sustainability in Taiwan.
Since the mid-19th century, due to the population and consumption surge, humanity has overcrowded theplanet. In other words, the sun is not able to sufficient provide in nature what all human beings would
require. The destruction of the environment makes sustainability on earth a serious problem. Extreme
weather conditions and possible mutations become threats to human survival on the earth.
One of the crucial factors of environmental changes is the energy we use. After industrialization, we haveover depended on fossil fuels. The increase of CO2 produced from the combustion effects the energy balanceof “absorption” and “release” on the earth. It is evident that the energy absorbed is greater than that whichis released, resulting in rising temperatures and climate change. In the COP21 conference that took placein Paris in December 2015, 195 leaders from different nations came to the consensus that humanity needs
to reduce carbon emissions as soon as possible. This also means that the globe needs to come to a “carbon
balanced” status in the latter half of this century so that nature can fully absorb the greenhouse gases
human society produces.

English Leadership Resource and External Training Subsidy
As an international brand, in order to encourage employees to continue learning, a total of 20 English courses
have been conducted in 2020, providing themes needed for work so that employees can improve their English
proficiency.
All courses are guided by professional foreign teachers and the topics of discussion are based on situations that
may be encountered in the workplace. Topics of the courses that have offered include: business email, businessnegotiation, customer complaint handling, business meetings, etc., allowing employees to make full use of theweekly gathering at noon to strengthen their English communication skill and apply it in the workplace!
In addition, HTC encourages employees to continue to absorb professional knowledge and to match their study
program to their work to ensure growth. Also encourages employees to improve their 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 2020 was about 1.49 million.

e-Library
HTC relocated its library to the Taipei Headquarter Building in 2018. HTC helps staff develop good reading habits
mainly by the provision of a wide range of reading activities and a rich collection of library resources; employees
can enjoy a rich literary atmosphere and reading environment. Electronic magazine services are also madeavailable for employees so they can view and read the current editions on their computers or mobile phones
anytime anywhere. At present, the cumulative number of users of e-magazines in 2020 has reached 3,571, in orderto enhance HTC's workplace reading atmosphere, promote a good reading culture, and make learning never stop.

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 canalso 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 unnecessary interruption. 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. In 2020, when the epidemic is severe, employees canstill keep up with the times and continuous learning progress through multiple online learning platforms.

The economic development in Taiwan in the past half century was achieved under the conditions ofunlimited CO2 emission in the atmosphere and energy (fossil fuel) availability in the world market. Whenthese two conditions do not exist anymore, the transformation of energy and society becomes an urgent
issue. In this speech, the topics covered the transformation of the world to the transformation of Taiwan’s
energy policy, as well as the necessary understandings and motivations we should have.

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HTC 2020 CSR Report146Sound Wage and Welfare System
Training Result
In order to cultivate HTC employees to quickly respond to fierce challenges from global technology and grasp
the industrial pulse, in addition to upgrading the professional technical annual training courses and department
professional courses, in conjunction with HTC's policy, organizational learning planning was conducted, coupledwith external training subsidies and other measures. Between 2018 and 2020, HTC invested nearly NT$ 12.11
million in employee training-related programs. Training hours totaled 220,000 and there were nearly 11,000
attendees, each person receiving 58.33 training hours.
In 2020, HTC male employees received 24,730 hours of training and female employees received 14,324 hours of
training. General staff received 30,133 hours of training, supervisors received 8,624 hours and management 297
hours. The table below lists staff training over the years:
Course (Hours)

Number of Participants

Average Training Hours

108,359

55,633

22.39

2019

73,24934,713

18.76

2020

39,054

20,225

14.99

Item

Year
2018

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 dotheir best and share the growing profits of the company.
HTC hires new employees through open selection procedures, with candidates offered positions and appropriate
wages based on academic background, professional years and market standards. The amount of performancebonuses received by employees is based on the company's performance and its work performance andcontribution to encourage employees and affirm their contributions and achievements. We promise nodiscrimination based on ethnicity, skin color, social status, language, religion, political affiliation, country/region oforigin, gender, sexual orientation, marital status, appearance, disability, professional association membership orother similar considerations not relevant to job performance.
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 andinnovation.

HTC Regular Earnings Ratio for Men and Women in Taiwan
General Staff

Note: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.

Category

Employees Training Hours and Sex Ratios at All Levels in 2020
GenderTotal Training (Hour)

General
Employees

Manufacturing
Employees

Mid-Level
Management

High- Level
Management

Male

Male

New Recruits Basic Pay and Taiwan
Minimum Wage Rate

Unit: hours

Male

FemaleMale

FemaleFemaleAverage Training (Hour)

Level

Male

FemaleMale

Female

基層員工17,75912,374

29.11

18.39

一般主管

6,721

1,903

7.46

5.26

高階管理

250

47

5.43

3.62

2020

115

100

101

100

117

100

106

1

(manufacturing
employees)

Minimum
Wage
Minimum
Wage

2

104

100

Female Type100

Basic Pay

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.
4. Regular earnings include a base salary with additional benefits.

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

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

2020

General Employees

Manufacturing Employees

Mid-Level Management

High- Level Management

Male

FemaleMale

FemaleMale

FemaleMale

Female

118

100

101

100

124

100

144

100

Note: The average base salary includes regular earnings and non-regular earnings. For example, an overtime premium.

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HTC 2020 CSR Report148Diversified Employee Welfare

Employee Salary and Benefit Increase Ratio
2018

2019

2020

2020 vs. 20195,705,420,000

4,201,438,000

3,485,698,000

17%

Item Description
Total employee salary and benefits
expenses (NT$)

Note:Total employee salary and benefits (proprietary financial statements)

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

2019

2020

2020 vs. 2019

person

3,447

2,481

72%

Average salaryNT$

1,097,000

1,125,000

103%

Median salaryNT$790,000

886,000

112%

Item
Full-time employees

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 and bonuses),
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 isconsistent 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 bydeducting those with supervisory positions, employees of overseas offices, part-time employees, and those who are eligible for exemption from statistics from all employees of thecompany (or permanent employees)
4. The reason for the adjustment of full-time headcount in 2019 is to follow the unified calculation method prescribed by the competent authority.

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 funeralsubsidies, 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.

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

Activity Clubs of HTC
The available clubs are Badminton, The HTC Child Support Club, The Way club, Basketball and other diverse clubs.

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 for patents,
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 planon 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 to the competentauthorities for approval, have their appropriation rate adjusted from 8% to 2%. In May 2020, since the reservefor old retirement pension had reached the standard level, the issuing of old pension was suspended for one year
upon approval by the competent authority.

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Education Scholarships for Children
The HTC Employee Welfare Committee provides scholarships for the children of employees from elementary
school to college. Those who meet the application criteria can apply: 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; and NT$3,000 for college students in their fourth and fifth year. A
total of 423 person applied for child education scholarship for the first semester of 2020, while 371 person applied
for the second semester.

HTC 2020 CSR Report150

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 alsooffer group insurance coverage.

Multiple Communications channels
Employee complaints system that has a complaint hotline, suggestion and complaint boxes, a complainant e-mailservice, 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.

Travel subsidy
In addition to the basic subsidy, the subsidy amount is also increased according to seniority.

Based on seniority, 2020 travel subsidy details as below:
Employee tenure
Base date: 2019/ 12/ 31

The HTC's Welfare
Committee

HTC

Total

On Board before 2014/12/31

5,000

4,100

9,100

On Board between 2015/1/1 to 2016/12/31

5,000

1,800

6,800

On Board between 2017/1/1 to 2018/12/31

5,000

900

5,900

On Board between 2019/1/1 to 2019/12/31

5,000

none

5,000

On Board after 2020/1/1

none

none

none

Meal subsidy program
Generally, employees receive NT$130 yuan for the whole day on weekdays, and the maximum subsidy for lunch
and dinner on holidays is NT$100. Clock-in employees and manufacturing employees go to work during normal
attendance hours, with subsidies ranging from NT$35 to 50 depending on the shift schedule, and provide daily
afternoon tea.

Transportation Vehicles
In order to take care of employees’ commuting safety, energy saving and carbon reduction, HTC provides
transportation shuttles. The shuttle bus waiting area is equipped with shuttle bus GPS monitoring system to allow
users can keep track of the position of the shuttle bus at any time. Furthermore, shuttle bus questionnaires weresent out to collect the opinions of users, providing better shuttle bus services with more comfort, convenience andsafety.

A Five Star Gym
In order to encourage and promote the sports atmosphereand allow employees to develop good exercise habits, HTC
has set up a fully equipped professional fitness space in officebuildings, Various modern fitness equipment including freeweight training equipment and weight training mat floor.
HTC has commissioned professional fitness management
consulting firms and professional suppliers to manage thegym 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 wereon shifts at the site. This provides employees with the best
health consulting services and the environment, and theestablishment of positive sports safety and healthcare.

Use of the Gym
Category

Number of Users in 2020

Use of the Gym

25,659In addition, the gym's courses are planned and arranged(person-time)on various health topics and activities and employees canParticipation inparticipate according to their preferences, such as two-month
aerobic classes
260
aerobic courses throughout the year to provide a diverse(users)curriculum for employees. There are Yoga, Pilates, flywheel,core muscle group TRX, Body Combat, and muscle sculpture
courses available. Employees can registor the courses through HTC's online form, saving on-site waiting time.
Shuttle buses are equipped withGPS monitoring system, allowing
employees to keep track of thearriving time151

Friendly Workplace

Shuttle bus timetable and questionnaires

Another spectacular sports facility is to be found on the 17th floor of Taipei Office. It is a large hall, practicallya stadium, with a 10-meter-high ceiling that can be used for basketball, tennis or badminton. The gym alsocommenced additional sports massage classes sold at NT$600-$800/30 minutes and have employee discountis NT$400. Through professional sarcolemma stretch, the employees enjoyed a more comfortable exercise
experience.

HTC 2020 CSR Report152Creating a Happy Workplace
A Working Environment Incorporating Brand Spirit
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 that allow
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 that these interactionoriented spaces will encourage and promote cross-department synergism and cooperation, supporting the freeextension of creativity. HTC believes sharing is the best kind of interaction. To this end we will share Taipei Officewith the community, This HTC Gallery will help young local artists show their creativity and work, promotingsocial and community interaction. In addition, the HTC Gallery will cooperate with 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 this building can also appreciate being in an “artgallery” that will inspire creativity and help HTC launch better and more amazing products.

HTC Gallery
Due to the outbreak of COVID-19 in 2020, theopenings of some HTC Gallery exhibitions
were canceled. However, given that the HTC
Gallery exhibitions create an artistic ambiancein the workplace which is in line with our
vision to increase employee satisfaction – ourcommitment to this remains.

2020 End-of-the-Year Appreciation Banquet
Considering the pandemic, HTC’s End-of-the-Year Appreciation Banquet of 2020 was adjusted to an online
assembly in January 2021. During the 2021 online HTC Town Hall, the chairman shared the Company’s vision andfuture, as well as awarding 20 senior employees. Additionally, the Company and chairman hosted a global lucky
draw after the online HTC Town Hall in order to thank all the employees for their contributions during the year.
The spirit of the Chinese tradition and lucky draw was expanded to share with all our international staff. Besides
the top four cash prizes in live stream, there were several different ones, including the chairman’s hike, and 300
HTC 5G smartphones in the lucky draw. Other than that, we separated the appreciation banquets by division inorder to properly thank all employees who contributed to such a great outcome in 2020. The banquet symbolized
the appreciation from the Company and the chairman, both of which were also subject to the CECC prevention
policy.

Employee activities in 2020
Due to the severe situation of COVID-19 in 2020, HTC celebrated Mothers’ Day in a special yet safe way. We
prepared carnation soap flowers and an online “Mother’s day photo Show”for all the employees. We envisioned
infusing some warmth to our employees during the pandemic so that everyone could face their challenges withmore ease. We wanted to give them something to focus on besides just prevention measures.
On Fathers’ Day, we threw a “Health is Wealth” event based on the subject of health. The event included a grip
competition, scalp test, and a body composition test to help employees understand and maintain their own healthconditions.
In addition, in summer when the pandemic was less severe, we held a “2020 breakthrough the linit HTC Sports
Season” including basketball, badminton, and other games. This allowed employees to demonstrate theirsportsmanship, unity, and staff cohesion.

In 2020, the HTC Gallery worked with artists
with disabilities and encouraged them to create
more works by providing the gallery space
to them. In so doing, we also hoped to inspire
all staff members to innovate and change by
witnessing the persistency of these artists. In
2020, our exhibitions expanded to areas ofsculpture, glass, and digital image artwork toenrich and revive the Gallery. Staff and visitors
could appreciate both simple artworks as well as
3D pieces, by walking around and experiencing
different objects that were represented withcolors and lights. Hence, we elevated the qualityof the employees’ break time through being able
to experience this creativity. Moreover, the waysof appreciating artwork were more diverse andinteresting, and the audience and artwork also
formed different means of interaction.

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HTC 2020 CSR Report154

Health and fitness corporate certification
HTC has always been a believer of the notion “The health and fitness of our people are intangible assets ofour company.” With that in mind, we’ve built a 5-star gym, an indoor basketball court, and a badminton
court in our office building located in Xindian. (Detail refer P.152 -A Five Star Gym) We did it to create aphysically-active corporation culture, encourage our staff to be more aware of their own health and fitness.
In addition to that, we have commissioned sports professionals on-site to provide advice on sports skills andinjury prevention, as well as tips on sports safety and health care. In order to adopt our company policy of“Fitness Awareness,” we offer courses on various topics in regard to health care for our staff to join basedon their interests. We aim to improve our staff’s health and fitness.
HTC obtained Workplace Health & Fitness Certification in 2020. We’ve been developing a company cultureof fitness awareness through offering physical fitness classes and holding a corporate sports day forour staff. Our company has always been supportive of our staff maintaining their physical fitness. Afterobtaining the Workplace Health & Fitness Certification, we hope all of our staff can see the benefits ofexercise, making exercise a habit and really establishing a company culture of fitness awareness.

Work-life Balance Support
In addition, in order to encourage and support
employees to raise the next generation withconfidence, HTC has a perfect application systemfor parental leave to protect employees' work
rights so that parents can take care of theirnewborns with ease.

Employees applying for Family care leave
Year

Male

Female

Total

2018

51

136

187

2019

42

103

145

2020

26

54

80

Employees Applying for Unpaid Parental Leave and Resuming Duty after Leave in 2020
Male%

Female

%

Total

208

53.89%

178

46.11%

386

The Number of Person Actual Applied UPL in 20205

13.16%

33

86.84%

38

The Number of Reinstatement-to-be in 2020

6

12.77%

41

87.23%

47

The Number of Application for Reinstatement in 2020

4

10.53%

34

89.47%

38

The Number of Qualified for UPL for Raising Children in2020

Reinstatement Rate in 2020

66.67%

82.93%The number of application for reinstatement in 2019

7

12.7%

48

87.3%

55

The Number of Retention Over 1 Year After
Reinstatement in 2019

1

4.35%

22

95.65%

23

Retention Rate in 2020

14.29%

45.83

Note:
1. The “number of qualified for UPL for raising children in 2020” was based on the number of employees who had taken maternity or paternity leave within 3 years (2018-2020).
2. The "number of reinstatement-to-be in 2020" includes applied in 2018 and should reinstate in 2020, applied in 2019 and should reinstate in 2020, applied in 2020 and should reinstate in2020.
3. The "number of application for reinstatement in 2020" includes applied in 2018 and reinstated in 2020, applied in 2019 and reinstated in 2020 and applied in 2020 and reinstated in 2020.
4. The "Reinstatement Rate in 2020" = Number of employees reinstated in 2020 / Number of employees that should have been reinstated in 2020
5. The "Retention Rate in 2020" = Number of employees who had worked one year consecutively after being reinstated in 2019 / Number of employees reinstated in 2019.
6. The "number of application for reinstatement in 2019" includes applied in 2017 and should reinstate in 2019, applied in 2018 and should reinstate in 2019 and applied in 2019 and should
reinstate in 2019.

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 weprovide for our female employees include:
A female free 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, theloan of free hot pads, menstrual pain assessment, health knowledge and education, physician consultation orreferrals and so on.
A friendly environment for breastfeeding. We provide a warm and comfortable nursing environment,ultraviolet milk bottle disinfection devices, microcomputer thermos, and comfortable sofa, refrigerator forbreast milk storage, and infant breast-feeding-related publications and light music. HTC has 8 Breastfeedingroom in Taiwan that was visited 13,574 times in 2020.

155

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HTC 2020 CSR Report156

Listening to the Voice of the Employee
HTC employs nearly 3,000 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 tointernal communication with employees to build mutual trust and create a harmonious atmosphere within thecompany.
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. Before the meeting, we will discuss the previous unclosed case andthe newly added issues this time. In addition to inviting the relevant authority and responsibility unit directors
to participate, 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 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 are held regularly as areference for supervisors, internal operations, improvement of employee satisfaction levels and improvement ofwork commitments. A good communications mechanism results in harmonious labor relations. Labor disputes,
bad feelings and losses can all be avoided. And regarding human organization issues in recent years, the company
has conducted labor-management consultations in accordance with the law.
In October 2020. HTC was fined by the relevant authority for violating Article 36 Paragraph 1 of the Labor Law:
“A worker shall have two regular days off every seven days”. About this case, if employees need to work overtimeon the weekend, they shall request this from their supervisors. Furthermore, we also accordingly modified theregulations of the arrangements of staff shifts. For example, if any abnormal overtime occurs, the supervisor of
the unit shall provide explanations and examine the work deployment of the unit to the HR department. The HR
department then regularly examines an employee’s overtime situation to prevent similar cases from happening in
the future.

Labor-management Agreement and Employee Rights
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.

Major human resource allocation changes in 2020
To effectively use resources and professional skills, HTC carried out an organization optimization plan in
2020. Owing to changes in market and production needs, HTC must ensure that VIVE Virtual reality andmobile 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 future competitiveness.
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 toprotect employees’ rights and interests, hoping to minimize the impact.

Note：HTC's labor union was established in 2015, but until the end of 2020, no collective agreement has so far been made.

157

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HTC 2020 CSR Report158

Employee Satisfaction Survey

Effective Advisory and Assistance Channel

HTC conducts employee satisfaction surveys through questionnaire surveys to directly understand the voicesof employees, which can in turn improve work efficiency and effectiveness, and reduce the turnover rate, HTC
conducts employee satisfaction survey through questionnaires. The manufacturing employee’s questionnaire
survey conducted in 2020 consists of 6 categories including job content, work environment, salary & benefits,internal communication, gender equality, and organizational commitment. There are 650 HTC manufacturingcolleagues and the sample number of this survey is 100, and the questionnaire response rate is 100%. The targeted
score for 2020 was 3.50 points (out of 5) and the average score from the actual survey was 3.81 points, reaching theannual target.

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 2020,
employee feedback collected through multiple channels, summarizes the problems as below table. In addition
to the employee care office in the major units that provide a relaxing space for communication, timely help withworkplace problems can also be sought using the following channels. Also cooperates with EAP professional units
to provide employees with comprehensive consulting services.

In 2020, employees were highly affirmed by HTC's performance in issues such as the “Implementation of thegender equality law”, “Good internal communication environment” and “Being confident in doing your currentjob”. After the summary, we will focus on the company's sense of identity, salary and benefits, and will continue
to combine relevant activities and plans will be implemented to enhance employees’ recognition of the company.
The questionnaire survey results were also reported to the senior management team for review, and used as thereference for preparing the annual operational targets and plans.

The manufacturing employee's questionnaire survey conducted in 2020
4.00

3.96
3.88

3.90
3.80

Potential
Work
Problems

3.94

3.74

3.70

Work problems

3.64

3.60

3.53

3.50

Leadership style andcommunication
Compensation, benefits, andworking hours

3.40
3.30

Job Content

159

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 for communication, 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 toprovide employees with comprehensive consulting services. There was no gender discrimination cases reported
in 2020.

Work Environment

Friendly Workplace

Salary & Benefits

Internal
Communication

Gender Equality

Organizational
Commitment

Workplace sexual harassment,
sexual abuse, or sexual
discrimination

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

HTC 2020 CSR Report160

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 changed to ISO 45001 in 2020. Every new employee is given complete safety and healtheducation 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 15 members and regular meetings are held every quarter.
Among them, there are 6 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 each year according to the relevant problems that need to beaddressed. The focus is on asking all the people involved to follow 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 ofthem; 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.

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 andequipment as if they were family property, while all employees and visiting VIPs and manufacturers should beseen 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), and Party A
hazard notification course must be completed before being allowed to be stationed. The professional skills training
course content includes security guard duty principles and special response methods, such as the pregnant womenscreening procedure requiring pregnant women's label to be checked while refraining from contacting or holding
a security bar during the inspection. In 2020, 2 hours of training on service SOP and communication skills wereconducted for guards and their supervisors. A total of 20 people attended the training, reached 100%. In addition,
15-minute training on recent faults is implemented daily before the service.

Food Safety - Hearty and Healthy Meals at HTC
HTC collaborates with professional catering vendors to ensure our employees continued health. The menu designuses local Taiwanese ingredients and strictly selects seasonal food. We also work with qualified and certified
providers and dietitians to assist with the restaurants. Dietitians design nutritious, healthy, and delicious meals
that take into consideration nutritional benefit, calories, portion control, and use seasonal fresh ingredients.
Ingredients must be have CAS, TQF, ISO, HACCP, and other certifications. and the use of ractopamine is strongly
limited. We also provide several types of healthy drinks that are made on site so that employees can enjoy
beverages without worry. The restaurants also have vending machines to satisfy the employees’ needs at any time.
With all these measures in place, employees can enjoy good quality and healthy catering services.
In addition to food quality, we also actively organize on-site audits for our secondary food suppliers and requestthat they provide improvement plans. On-site audit items are separated into five categories according to the GHP:
plant environment, equipment, personnel, raw materials, and final products. We audited 16 suppliers in 2020 and
all related defects were improved after continuous follow-ups.

Regularly organize fire drills and exercise evacuation status

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HTC 2020 CSR Report162

Environmental Sanitation Agents

Food Safeguards

Health and
SafetyManagement

Checklists are used to control environmental
disinfection, the dress code, waste food control,
refrigeration storage temperatures, and the useof energy. Strict audits and checks are carriedout and all activities are strictly managed fromthe sorting of ingredients, to their cutting,cleaning, storage and processing.

To ensure the quality of life and comfort of our employees as well as that of nearby residents, HTC takes measuresagainst 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

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 andartistic installations to create a variety of styles for employees to enjoy and relax. On the first floor of theTaipei Headquarter Building, there is a tea booth selling selected good tea from Lalashan. With the ideaof healthy and nutritious ingredients, carefully selected raw materials are used to provide employeeswith products that are healthy and delicious. Furthermore, in response to environmental protection, theprovided utensils are recycled and cleaned for reuse. To promote waste reduction, customers bringing theirown cups will receive discount for their beverages.

Environmental expenses

2018

2019

2020

42,804

41,792

34,752

Environmental Maintenance Expenditure in 2020
Taipei Office

HQ & Plants

Total

Plant cleaning

12,165,098

11,391,563

23,556,661

Restaurant cleaning

2,957,535

2,449,657

5,407,192

Pest disinfection

89,820167,534

257,354

Rodent control

132,000

180,111

312,111

Carpet renta

76,252

59,202

135,454-

12,60012,600

Water tower cleaning

60,456-60,456

Gardening

848,800

412,800

1,261,600

Drinking Water Quality Control

Cleaning supplies

2,035,785

1,495,131

3,530,916

111,000-

111,000

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. A professional
company carries out the maintenance and care of the drinking fountains 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 are also posted in a prominent
position close to the drinking fountains. The total bacteria count of drinking water and E. coli colonies have passed
the test in 2020.

Total Expenditure

18,476,746

16,168,598

34,645,344

In order to enrich the choice of food, the employee cafeteria in HQ & Plants and Taipei Office will organize
food tasting event every month. After food tasting, questionnaire survey will be conducted to collectfeedback 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. In
order to increase the choice of employees, a complex catering and coffee bar is also planned to be stationedon the first floor of Taoyuan Building H, and will start trial operation in 2021/1.

163

Friendly Workplace

Category

Unit NT$

Elevator ladder cleaning

Floor Beauty

HTC 2020 CSR Report164

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
Health center for managing and planning affairs related to employee health.
General and outpatient rehabilitation services.

Health Management

Health exam and management for staffs.
Management/tracking for abnormal HE results, Special care and case follow-up
manag sement.
Health information webpage.
Comfortable breastfeeding rooms, Smoking cessation promotion, Weight-loss
Classes, Topic seminars, Blood donation activity.

Health Promotion

Influenza vaccination, Cancer screening, Infectious disease control and treatment.
Aerobics.
CPR & AED course design.
Establishment and maintenance of HE Database for Special-Operation Staff.

Occupational HealthFirst-aid training, Prevention and treatment of occupational injuries and illness,
Workers return to work management.
Mental consultations, Special counseling.

Employee Assistance Program

165

Friendly Workplace

EAP promotion activities and leaflets for new employees, Annual EAP promotion
course.

Health Management
HTC has established an “Employee Clinics.” Professional
medical counseling is available for staff and there are resident
doctors in the clinic. There is also excellent physical therapy
and health management service. HTC employees are notrequired to pay a registration fee at the employee clinic. 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, he fully understood the operating conditions of the plantarea and became familiar with the employees’ issues, which
provided extra protection of the plant staff’s occupationalsafety and health. The health center at Taipei office provides
doctor health services every Thursday and every otherFriday, including occupational medicine and family medicine
divisions. There are also physicians specialized in babyfriendliness, health policy and management, labor healthservice and health checkup and promotion. HTC HQ & Plants’s
Employee Clinics provides approximately 1,678 person-timesof service and 5,497 people attended Taipei Office HealthCenter in 2020.

2020 Service Result
Category

Person-time

Outpatient Service

1,141

Non-outpatient hours service

517

General Consulting

4,493

Trauma Treatment389

Occupational Hazards and Job
Placement

26

Physiotherapy

609

Total

7,175

In response to the Company’s operational circumstance in August 2020, the health center continued to provide
health care services to our employees instead of the staff clinic. This was done according to the regulations of the
Occupational Safety and Health Act and the Law of Occupational Safety and Hygiene. Besides promoting healthactivities, health checks, and anomaly management, we also aimed to decrease the chances of occupational
damage that could occur from an abnormal work load. These instances can result in recurring muscle and skeletal
diseases. We also strive for maternity health protection, and collaborate with doctors from Linkou Chang Gung
Memorial Hospital, who would be stationed at the health center with the responsibility of conducting employee
health checks and providing health-related information. Hence, our employees are taken care of and we are able
to reach the goal of improving their health.

HTC 2020 CSR Report166

Annual Health Check Subsidies and abnormal tracking

Annual Health Check Abnormal Items and Number of Person

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.
In 2020, HTC spent NT$ 4,282,800 on subsidized health checks for general employees in Taiwan. There were909 benefited employees. Among them, the health check completion rate for general employees in 2020 was
90.99%, while that for manufacturing employees was 100%, 102 people completed the health check in 2020. Aftercompleting a health check, the employee clinic conducts management classification according to the results of
the health check. If employees are classified as abnormal in terms of their health, they will be dispatched forindividual counseling depending on the severity of their health concerns. Alternatively, they will be given relevant
health management and health education. Through constant care and follow-ups, we manage to control therecovery period of employees. Health checks and follow-ups of employees with anomalous health concerns would
be carried out continuously. Therefore, employees can receive extensive health care through the health checks
and follow-ups from the Company. As a result, no harm caused by overwork occurred in 2020.

HTC Health Check Regulations
Frequency
Regulations

Manufacturing employees Once every two years after arrival
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 HealthProtection Regulations ”

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

Last check date47 persons had abnormal health examination results, accounting for 2% of the total number of employees in
Taiwan, and the top three abnormal items were Triglycerides, hemoglobin, and High Blood Pressure. Arrange
medical consultations by doctors and health education by nurses for employees with abnormal health check-up
items.

2.General Employees
276 persons had abnormal health examination results, accounting for 12.5% of the total number of employees
in Taiwan, and the top three abnormal items were Total Cholesterol, Low-Density Cholesterol, and Triglycerides.
Arrange medical consultations by doctors and health education by nurses for employees with abnormal healthcheck-up items.

Uncompleted Annual Health Check Tracking Mechanism

Manufacturing employees Implemented by employee clinic

Way

1. Manufacturing Employees

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

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
are requested to assist in supervision. According to
the results of the health checkup, different levels ofmanagement will be carried out. Employees reaching acertain degree of severity are given health advice andhealth education.

Health Promotion Programs
The Accumulated Health check completion rate of general employee

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 willorganize seminars and health promotion activities
from time to time every month. The annual healthpromotion courses will be organized based on theprevious year's health check abnormal items as wellas the topics interested by the employees from thequestionnaire survey results.

100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%

167

Jan

Feb

Friendly Workplace

Mar

Apr

May

June

July

Aug

Sep

Oct

Nov

Dec

2020 Health check follow-up and statistics
The number of new recruits withphysical abnormalities follow-up

26

The number of employees with physicalabnormalities follow-up

299

Note:
1. This statistic does not include resigned employees
2. 2020 Physical Examination Abnormal Education Rate: Except for people who do notneed to be tracked in May and June, and 98.6% in July, all other months are 100%

2020 Health Promotion Course Content andNumber of Participants
Number ofclassesNumber of
AttendeesFirst Aid Courses

10

310

Vision Care

2

124

2

271

1

60

9

841

Course type

Infectious Diseases andCancer Prevention
Exercise and Diet Weight
Loss Courses
Health Enhancing
Promotion

In 2020, a total of 841 people have participated inhealth promotion courses, of which 153 people need
Blood donation
7553
further health consultation and followup, all of which
Total
31
2,159
have been tracked. For health promotion courses, a
total of 31 sessions will be held in 2020, with a totalof 2,159 person-times and an average satisfaction rate of 99.67%. 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.

HTC 2020 CSR Report168

HTC Employee Clinic Facebook Page
HTC has created a Facebook Fan Page for theemployee clinic (https：//www.facebook.com/
HTC.EmployeeClinic). Besides promoting healthpromotion activities, information on the correct
health management is provided to employees,
cultivating employees' autonomous healthmanagement capabilities. As of the end of 2020,
the number of fans in FB Fan Page reached 1,017
persons.

2. Emerging Health Issues
HTC’s employee clinic, environmental safety department, human resources division, and other undertaking units
planed the Protection Program in four themes, which was implemented gradually since 2016.
Topic

Organizer

Abnormal Workload-triggered Disorders

Employee Clinic

Maternal Health Protection Plan

Employee Clinic

Preventing and Managing Musculoskeletal Health
Execution Infringement Prevention

OSH Department
HR Department(1) Abnormal Workload-triggered Disorders prevention
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 made with medical
doctors, or health consultants for employees should a medical check find them to have a health problem. A changeof work or the adjustment of working hours is usually recommended. In 2020 screening and notification, 30 risky
employees were interviewed by doctors. There was no incident of injury caused by overload in 2020.

Occupational Health
1. Specific Health Check
In 2020, the work environment at the HTC Taoyuan Plant is carefully tested and monitored. The special healthhazardous operations such as those involving ionizing radiation, dust and MDI must receive a thorough healthcheckup. The total number of employees required for special health examination was 42 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 beinspected was 83 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 check up was 25 people, and the number of employees qualified for the second-level management ofspecial health check up was 17 people. According to the “Labor Health Protection Regulations”, the 17 employees
qualified for the second-level management and the 27 employees with abnormal results from night work healthexamination were asked to visit to the employee clinic individually, and health consultation service was offered bydoctors, 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.

Preventive measures against health-endangering heavy workloads

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

Healthmanagement

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

Set uppreventive
plan
Effectivenessassessment

169

Friendly Workplace

Taoyuan health center counselingservice

Xindian plant on-site healthservice
The number of employees ( new recruits &IDL) with physical abnormalities (Xindian)

The number of new recruits withhealth check
The number of employees (IDL) withphysical abnormalities follow-up

Make preventive measures against
health-endangering heavy workloads

Assess the effectiveness of plan andmake improvement plan

Number of injuries due to fatigue

HTC 2020 CSR Report170

Employee Assistance Program (EAP)(2) Maternal Health Protection Plan
When safety and health hazard factors exist in the workplace, there may be adverse effects on pregnancy andbreastfeeding. When female employees' presence in the workplace is indispensable, the importance of theprotection of maternal health is highlighted. HTC has since June 2016 launched the Motherhood Health Protection
Program, which includes all female employees one year after childbirth or breastfeeding women as protectedsubjects. 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 2020, 28
employees completed the risk classification and protective measures, indicating the considerably safe work
enjoyment and contents.

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
2020, a total of 814 employees used the telephone consultation services. The analysis and recommendation on
employee consultation topics are reported regularly to the Occupational Safety and Health Committee.
Appointment Hours: Monday ~ Friday 9 am ~ 7 pm
Reservation Tel: Mobile: 035-260415

Female worker maternal health risk assessment and its processes are as follows:
Employee Assistance Program (EAP) Results① Workplace Risk Assessment

2018 年

2019 年

2020 年

Number of Telephone Counseling (Free)

351

532

690

Number of Interviews

91

129

116

Hours of Interviews

100

132

124

Number of Interviews (Male)

38

52

55

Number of Interviews (Female)

53

77

61

Number of Interviews (Manufacturing employees)

2

10

1

Number of Interviews (General employees)

89

119

115

460,000

549,600

674,625

Evaluate workplace health and safety risk factors(Evaluation subjects include: Women who are pregnant, within 6 months after delivery (including stillbirth after 24 weeks ofpregnancy), 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 needto understand the importance of notifying their employer
as early as possible about pregnancy, having given birthor breastfeeding in the last six months, and should be
re-evaluated when health conditions, duties, or working
conditions change.

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 mother and thechild⑤ 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 health protection
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.

171

Friendly Workplace

Invested expense (NT$)

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 performself-inspection to achieve our zero-accident goal.
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 the comprehensive
prevention of occupational accidents.
The 2020 hazard identification is Class 2, Class 3 and Class 4, which are medium to high risk. The types of injuries
with higher severity are falling, electric shock, fire, coil clamp and confined-space operations. The current
control methods include implementing checkpoints before/during/after operations, education and training, andpromotion.

HTC 2020 CSR Report172

In the event of an occupational injury, our notification procedure is as follows

2020 Full-time Environmental Safety and Health Personnel Training

Traffic accidents outside the factory area

License type

NotifyImmediately notify
the supervisor or theforemanCall the police
Call the police to filethe case
Triplicate form ofcase report

Go to a hospital
Injury treatment
Proof of diagnosis

RecordPrepare theoccupational injury
investigation andanalysis report

Accidents in the factory area

NotifyImmediately notify
the supervisor or theforeman

Go to a hospital
Injury treatment
Proof of diagnosis

RecordPrepare the occupational injury investigation andanalysis report
Carry out improvement based on the hazard
factorAspectMeasureManagement of Safety
and HealthIf there is any change in the organization or addition of new business units, this has to bereported to the authorities concerned. Such information ranges from hazard statistics, hazard
investigation analysis, meetings convened by the company occupational safety and healthcommittee, preventive inspections, and the management of the entry of contractors intoplants.

Education and Training
for Safety and Health

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

Standard Operating Proceduresand Job Safety Analysis

Set up rules and procedures for operation, maintenance, and work safety. Amend rules forworkplace safety and health, general knowledge of dangerous materials, and the assessmentof 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 solvents in working
environments, ionizing radiation exposure, and infrared detection.

Emergency Response

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

Health Managementand Enhancing

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

Safety and Health Campaign

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, andslogans. We constantly update information and communicate with employees over workplacesafety. All these efforts are aimed at improving work efficiency.

173

Friendly Workplace

Person

Hour

Total

Organic solvent operation manager training

3

18

54

Specified chemical substance operations supervisor initial training

4

18

72

Stacker operator (>1 ton) retraining

3

3

9

Dusty/hypoxia operations Supervisor retraining

2

6

12

Scaffolds assembly works supervisor retraining

1

6

6

Level B Management personnel in charge of occupational safety and health.

1

115

115

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 to prevent andprevent occupational disasters. During the operation of the contractor, project officer will be at the site. If there isan accident, the project officer can call 831919 to ask the medical staff to perform treatment at the site or take theinjured contractor to HTC employee clinic for treatment. 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 thesite. In addition, HTC has passed the ISO45001:2018 version of the Occupational Health and Safety Management
System. 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.

Measure of Contractor
Construction
Management
The provision of site safety induction
sessions at construction sites.
Verifying the information about construction
workers and vendors.
Monitoring high-risk operations.
Personnel access control.
Ensuring construction site safety.
Conducting safety and health management
for new facility construction.
Obtaining the required insurance forcontractor employees.

Contractors Healthand Safety Audit

Incorporating requirements for safety & healthmanagement in the written agreements with allcontractors according to the applicable regulations toclearly define contractor obligation and responsibility, andevaluate all the risks in the working environment includingthat from dangerous machines, so as to have proactive
control and eliminate potential hazards.
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.
HTC 2020 CSR Report174Comprehensive Emergency Rescue
Measures2020 Occupational injury in Taiwan Plant
The main types of occupational injuries in HTC plant and 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.

A 24-hour emergency rescue Hot Line has been
set up as part of a fully comprehensive emergency
notification system.
Sufficient rescue personnel have been lawfully
designated and emergency rescue personnel
training courses are held annually.

Occupational Injury Death Rate

16 Automated External Defibrillators (AED) areavailable at specific places within the company.
Emergency evacuation drills are carried out
periodically.
Since 2010, CPR seminars are held regularly eachyear
These related measures have been effectively carried out at HTC. In 2020, most occupational injuries were theresult of traffic accidents, with 10 cases in the HQ & Plants and zero case in the Taipei Office. There were 3 injury
cases that occurred within the HQ & Plants and there was no accidents in the Taipei Office. Falls are the mostfrequently reported incident (2 cases), with 117 days of labor lost. In 2020, the average employee injury frequency
rate (FR) of HTC employees was 1.24 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 48.42 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.

2018

2020

2019

FR

SR

FR

SR

FR

SR

HQ & Plant

0.83

7.53

0.91

4.56

1.24

48.42

Taipei Office

0

0

0

0

0

0

0.30

1.8

0.30

1.8

0.30

1.8

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 of loss, excluding traffic accidents.
4.FR(Injury Frequency Rate per Million Hours Worked) = Incidence of Lost-Time Injury×1,000,000/total hours worked
5.SR(Lost Day Injury Frequency Rate per Million Hours Worked) =Days Lost for Lost-Time Injury×1,000,000/Total Hours Worked

2018

2019

2020

HQ& plant000

Taipei Offices

0

0

0

Contractor and Supplierof HQ & plants

0

0

0

Contractor and Supplierof Taipei Offices

0

0

0

Recordable Occupational Injury Rate

Friendly Workplace

2018

2019

2020

HQ& plant000

Taipei Offices

0

0

0

0

0

0

0

0

0

Contractor and Supplierof HQ & plants
Contractor and Supplierof Taipei Offices

Recordable Occupational Disease Rate

2018

2019

2020

HQ& plant

5.45

3.19

1.24

Taipei Offices

0

0

1.61

0

0

0

0

0

0

Contractor and Supplierof HQ & plants
Contractor and Supplierof Taipei Offices

2018

2019

2020

HQ& plant000

Taipei Offices

0

0

0

0

0

0

0

0

0

Contractor and Supplierof HQ & plants
Contractor and Supplierof Taipei Offices

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

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

2018

2019

2020

HQ& plant000

Taipei Offices

0

0

0

0

0

0

0

0

0

Contractor and Supplierof HQ & plants
Contractor and Supplierof Taipei Offices

175

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*

Average FR & SR in Taiwan Plant in the past 3 years

TargetSeverity Occupational Injury Rate(excluding deaths)

Number of occupational injury death / working hours (total hours worked) x 1,000,000** Note:1. The total number of employees is calculated based on the total number of employees asof December 31, 2020.
2. The 2020 total number of male working days in head HQ & Plants is 102,223,926 days,
and the total working hours are 1,017,769 hours
3. The total number of female working days in the HQ and Plant was 76,846,085, and thetotal working hours were 1,017,769 hours.
4. The 2020 total number of male working days in the Taipei office was 269,200 days andthe total working hours were 2,265,990.42 hours.
5. In 2019, the total number of working days for female in the Taipei office was 98,975 andthe total working hours were 836,502.25 hours.
6. 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)
7. 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.
8. Since 2016, the company's contractors have not had any accidents, so the total working
hours of the contractors in 2020 are not included in the statistics.

HTC 2020 CSR Report176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 and harmonious
society. The Foundation plays an important part in community engagement and social services to instill the corevalues of integrity, honesty, care, love, positive thinking, and respect for natural resources. The HTC Foundation
invested NT$ 15.69 million on education in 2020, while HTC Social Welfare and Charity Foundation spent NT$ 39.8
million on charity business.

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

MissionMany Blessings Courses

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

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 the principle 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. In 2020, a total of 11 classes of four schools will be
implemented, and a total of 252 students will be benefited. The students get the energy to move forwardand 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.

Objectives

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 character andsetting a good example with our own conduct. Group discussion and experience sharing with different
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.

1. To encourage the development of good campus culture by influential education projects and thecontinuous and systematic encouragement of teachers, parents, and students.
2. To encourage the development of good urban character culture by influential education projects andurging local communities to work towards this end.
3. Care for disadvantaged families and the provision of educational opportunities for young people to givethem 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 andprofessional life and to set a good example with our own conduct.
2. To protect the environment and to develop a cultural and aesthetic disposition through readings.
3. To be a world citizen, to make reasonable efforts to help the poor and the disadvantaged in the world, andto 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.

“Character First” course emphasizes the concept definition and operational definition with the core valueof nurturing the leader and team work. Besides, it is believed that people can lead in different kinds ofsituation. The main goal of these courses is to nurture groups of the cadre of basic level equipped withethics and integrity.

179

Social Investment and Contribution

HTC 2020 CSR Report180Other Social Engagement Activities
In addition to sponsoring the social work upheld by the HTC Foundation, HTC also positively engages in public
interest activities through other channels. In 2020, combining business development and brand value, continue toinvest in international and domestic social welfare and sponsorship activities.

VIVE Virtual Reality
HTC believes that virtual reality will completely change the interaction between mankind and the world, andliberate human beings’ limited imagination. The invention of VIVE provides a top immersive virtual reality
experience related to our work, education, games, communication, entertainment, and religion. HTC combines
virtual reality and social participation by using powerful software and hardware to build a brand-new learning
environment that can replace situations that are high-risk or difficult-to-simulate situations in the past. Throughthe unlimited possibilities of VIVE, we aim to change education and help develop a VR-cultivated environment inorder to realize HTC’s vision of giving back and caring for society.

HTC uses virtual reality skills to assist in lowering the risks offirefighting training
The training process of firefighters in different nations is dangerous and expensive. Not only are billions ofdollars spent, but firefighters are also exposed to high risks when building effective training facilities andsimulated fire environments. Burning and death can still happen in simulated situations. Other than that,the chemicals used to ignite and extinguish fires are also highly carcinogenic.
HTC launched a new generation of FLAIM Trainer that combines tactile feedback technology and real world
firefighting equipment, which provides firefighting departments with more diversified, safe, and highly
immersive VR-simulated training environments. On one hand, we can lower the level of danger as well as
the cost of trainings; and on the other, we can elevate the training efficiency whilst lowering pollution to
the environment.

Enhance medical quality and education through VR
The HTC Medical VR team is committed to the vertical integrationof VR in medical education as well as clinical use. In addition tofacilitating the interest and effectiveness of medical learning, it canalso enhance the communication between doctors and patientsand the quality of medical treatment, and create the greatest social
benefits. At the same time, our Medical VR team is expediting thedevelopment of a global medical VR ecosystem and working withVR developers to implement new medical VR technology in reality.
We have already successfully collaborated with many hospitals
and universities to create world-class standards. These include the
National Taiwan University Hospital, National Defense Medical
Center, MacKay Memorial Hospital, Taipei Tzu Chi Hospital, Taichung
Veterans General Hospital, National Cheng Kung University Hospital,
Central Taiwan University of Science and Technology, to name just afew. With them, we built cutting-edge VR medical training centers, sothat the education in medicine and nursing can be upgraded to thenext generation.

181

Social Investment and Contribution

HTC 2020 CSR Report182

Alliances with schools to establish VR talent incubators
HTC actively collaborates with schools both domestically andinternationally to provide higher education resources. Therefore, moretalent can be found and participate in the industry. Due to a much
more developed and mature VR ecosystem and having to confront
the impact of the pandemic, virtual reality is the key to realizing newwork and life styles. HTC began with cultivating talent by signing amemorandum of cooperation with the National Dong-Hwa University- an important educational institute in the East Taiwan - in 2020. Thiswas our dedicating to building the first VR talent incubator in East
Taiwan.
In early 2021, we collaborated with the New Taipei Municipal New
Taipei Industrial Vocational High School by joining the “DemoDay” project. For this, we established the “VIVE training center” toconsolidate the foundation of VR education. We also cooperated withjunior high schools in school districts to design a vocational exploration
curriculum so that students interested in information technology canhave the opportunity to learn at an earlier stage. As a result, we closed
the information gap caused by imbalanced educational resources.

In collaboration with Kaohsiung City Government – MIT Virtual
Reality Content
HTC continues to foster VR content developers domestically. We
collaborated with the Economic Development Bureau, Kaohsiung City
Government in December 2020. We coached domestic start-up teams to
successfully launch seven pieces of work on Kaohsiung KOSMOSPOTx
VIVELAND in the fourth quarter. In total, HTC assisted in launching
14 pieces of work, 6 of which were exported to overseas markets. We
also launched on the global VR commerce platform, VIVEPORT Arcade,demonstrating Taiwan’s self-made and innovative VR strength.

183

Social Investment and Contribution

VIVE ORIGINALSVIVE ORIGINALS VISION
Create an entertaining experience with cultural values in the virtual world

Solution Provision

Content Production

Theatre Management System
Volumetric Capture Studio

Flim

SolutionContents

Animation
Interactive Art
Music

Pan-entertainment
IP with cultural andBusiness Channels
VR Theatre
Exhubition

entertainment value

Channels

Platform

Platform Services
Blockchain XR Content
Trading Platform
Online Virtual Concert

HTC VIVE ORIGINALS is a content brand owned by HTC VIVE. It is committed to the development of native IP, theproduction and publication of original content, and the exploration of VR movies, art, animation, music, culturalcollections, creative entertainment, and other industries. VIVE ORIGINALS is also actively building a crossdomain team to create content and VR technical spec standardization. Moreover, it is aimed to create content
production SOP (standard operation process), and to provide a wider variety of VR solutions. Meanwhile, profit
comes from licensing for public broadcasting, organizing exhibitions, and trading for art collections with crossdomain contents. We also actively strive for collaborations with government for film and television investments.
Furthermore, we want to expand the scale of content, create industrial values, and build up a VIVE Reality
ecosystem by content cluster to fulfill the ultimate goal of enriching human cultural life through new technologies
and creativity.
The vision of VIVE ORIGINALS is to create an entertaining experience with cultural values in the virtual world.
To deepen the connection between the virtual and real world, VR technology can be applied in culture and art
collections, as well as video and audio recordings through our four pillars of development. The four pillars arecontent production, business channels, platform services, and solution provision.

HTC 2020 CSR Report1841. Content Production:
As a content creation team at the forefront, HTC VIVE ORIGINALS devotes to original IP development and originalcontent production. It also engages in distribution and exploration in VR film, art, animation, music, culturalcollection as well as industries of cultural creativity and entertainment.

New original IP content: Frame-by-frame animation with VRtechnology, The Sick Rose

In 2020, VIVE ORIGINALS planned for new original IP production, and the commercialization of digital artwork:(1) Frame-by-frame animation with VR technology in “THE SICK ROSE”.
(2) The artwork of Japanese artist, Miwa Komatsu, “Inori”, is included in the 20 limited editions of the VR digitalcollection.

2. Business Channels:
By profiting through new business models like public broadcasting authorization of cross-domain content,
exhibition making, and art collection and dealing, HTC VIVE ORIGINALS actively seeks cooperation opportunities
on technology application and investment with the public sector. Expanding the market scale and creating
industrial value, it combines virtual technology with creative content to trigger dazzling cross-disciplinary andcross-domain sparks. Consequently, we built a phenomenal and extraordinary VIVE Reality ecosystem.
In 2020, we broadcasted the VR work exhibited at the Venice Film Festival in Taiwan, in collaboration with TCCF
Taiwan to organize the Creative Content Fest.
(1) The Venice Film Festival: The audience can experience 32 nominated works in Taiwan without flying to Venice.
We make the borderless transmission of art and culture possible so more people can experience opulent
entertainment.
(2) The TCCF Taiwan Creative Content Fest: We organized experiences and activities of VR works at the physicalexhibitions and forums with international speakers discussing culture, technology, and the impact of thepandemic.

VIVE ORIGINALS expects to release the first frame-by-frame animation with VR technology, “THE SICKROSE”, globally in 2021. The production was made out-of-the-box and infused with a new style compared
to traditional frame-by-frame animation. This has won international acclaim. It was nominated for the“VIRTUAL REALITY IMMERSIVE STORY PROJECTS”, and is the only Asian self-made animation among 12
nominations. VIVE ORIGINALS has excelled in the Venice Film Festival many times, demonstrating the VR
capability of Taiwan to the world.

3. Platform Services:

Besides the innovative features of the filming techniques and plot of this VR animation, each dough figurine
is a key character in the film. The whole story began with the dough maker, Huang Yun-Sian.

HTC VIVE ORIGINALS launches the “Blockchain License Trading System” to facilitate resource integration forcontent developers, entrepreneurs in the cultural and creative industry, and oine channel operators, enabling
more e ective synergy between content and commercial channels while optimizing cooperative business models.
We plan to activate the platform at the end of 2021. This aims to cultivate good impressions of digital and physicalartwork on the platform while simultaneously protecting digital artwork through safety mechanisms.

Huang Yun-Sian started learning traditional dough figurines with her father when she was a child. She had
been selling dough figurines with her father since the age of six until her sophomore year in university.
Although she chose a different career path after her graduation, she decided to pick up the skill again andpresent the art of dough figurines to more people.

4. Solution Provision:
HTC VIVE ORIGINALS develops the VR Theatre Management System (TMS) to provide a simpler and more userfriendly management interface through systematic playback management. In 2020, it also inaugurates the firstcommercial virtual volumetric capture studio in the private sector to enhance the range and depth of applying
immersion for realistic virtual experience, giving rise to more excellent XR works.

185

Social Investment and Contribution

The puppets in the animation require a lot of coordination with filming techniques; moreover, there aremany challenges in production. For example, the clay needed for making the figurines is different from theone for dough figurines. Furthermore, the clay requires high flexibility for motion adjustments, as well as asupporting capability to sustain the posture. Huang and her father tried to mix different materials multiple
times and finally created the most suitable one.
The vanishing craft of traditional Taiwanese dough figurines is combined with technology to become a VR
frame-by-frame animation - enabling the traditional craft to be recorded and kept alive. Furthermore, themaking of dough figurines is infused with a new sense of vitality, which demonstrates Taiwan’s creativity to
the world.

HTC 2020 CSR Report186

In collaboration with the Japanese contemporary artist, Miwa
Komatsu, to create a VR interactive artwork, “INORI”
In 2018, VIVE ORIGINALS and the Japanese artist, Miwa Komatsu, commenced a one year collaboration.
Miwa Komatsu’s 2D artwork is combined with VR content technology through a film narrative approach topresent a different spirit of this cross-national authentic creation.
Kay Huang spent more than eight months creating the music and continued to alter it during the entire
process. According to Kay, the physical and mental experience in immersive virtual reality is very different
from that of open space. Kay explained that because in the virtual reality space the peculiarity of soundand the serenity of the heart vary a lot from traditional creation. The best result for Kay during the VRmusic creation is that she learned that only inner quietness can calm her down, allowing her to hear more
possibilities and create music with more diversified perspectives.
Viewers can wear a VR headset and then enter the world of mythical animals and explore a magical space.
In the work of Inori, we achieved three innovations: cross-disciplinary innovation that combines technology
with art, commercial innovation that develops a blockchain trading platform, and technology innovationthat creates interactive modules (sound, palate, and interaction). We expect to combine Taiwanese local
music, Japanese artists, and VR technology to integrate the Taiwanese and Japanese culture and art spheresto spark spectacular results.
VR technology combined with art is just like a new global Renaissance movement. VIVE ORIGINALS insistedon embarking from the VR original content point of view. After the best moments and venues of valuable
VR content received recognition in world-class international film festivals, we launched 20 limited editionsof those VR digital art collectibles as the best examples of the fusion between technology and art.

In collaboration with the Japanese contemporary artist, Miwa Komatsu, tocreate a VR interactive artwork, “Inori”. Inori was selected in the 76th Venice
Film Festival in 2019.

Miwa Komatsu performed a live painting in Venice.

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Social Investment and Contribution

Produced by VIVE ORIGINALS, and co-createdby the Japanese artist Miwa Komatsu and the
Taiwanese musician Kay Huang, the interactive
VR artwork, “Kay Huang x Miwa Komatsu x
HTC: Exhibition of INORI, Experience of a CrossDisciplinary VR Music Rhapsody”, was created.
The production took more than a year. We invitedspecial guests (from left to right), VIVE ORIGINALS
President, Liu Szu-ming, music master, Kay Huang,Japanese modern artist, Miwa Komatsu, and
TAICCA chairman, Xiao-Jing Ding.

In 2021, VIVE ORIGINALS included Miwa Komatsu's “Inori” in the 20 limited editions of the work as a digital VR art collectible

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Venice VR Expanded in Taipei with VIVE ORIGINALS assigned as the
exclusive partner
Between 2017 and 2019, the original IP work of
VIVE ORIGINALS excelled and was nominatedfor multiple awards in the Venice Film Festival.
This Taiwanese authenticity won global acclaim.
Thus, when COVID-19 was raging in 2020, the77th Venice Film Festival VR category wasthemed “VENICE VR EXPANDED”. This was thefirst time the festival ventured beyond Venice.
VIVE ORIGINALS was appointed as the exclusive
partner in Taipei as well as 15 iconic cities in 13
countries, such as Paris and Amsterdam, and areconnected through a satellite network. VR offline
broadcasting was activated and audiences could
appreciate 32 selected works from September 2
until September 12, 2020.

Collaborating with the TCCF to organize the 2020 Taiwan Creative
Content FestHTC in collaboration with the Ambassador Theatres to build thefirst commercial VR theatre.

VIVE ORIGINALS is devoted to integrating cross-disciplinary industries, developing a VR ecosystem,
developing VR theatre systems, and participating in more than 50 film festivals. In 2017, we built the VRtheatre management system, accelerating VR works to be part of the entertainment of daily life. In 2020,
we collaborated with Ambassador Theatres in Taipei and became the first VR commercial theatre tocollaborate with cinema. This time we chose Ambassador Theatres as our partners. It is not only a perfectbusiness integration, but also an expansion of the VR industry and commercial collaboration. The VR works
nominated in the Venice Film Festival were our first selections to be broadcasted. We will release morediversified VR content to audiences in the future. The bigger the film and game markets are, the bigger VR
is.
TCCF 2020 Creative Content Fest hosted by TCCF, the VR content experience, and international forums

The 2020 Taiwan Creative Content Fest (TCCF) organized by the Taiwan Creative Content Agency (TAICCA)
was held from November 17 to November 22, 2020. With the theme of “Human Touch – A Closer Future”, it
connected industries of cultural content creation to build a national brand of Taiwanese culture.
Two projects recently launched by HTC VIVE ORIGINALS were invited to be exhibited at Future Content
Experience Zone of the festival: Anpu’s “An Ode to Moss: Musical Wander”, combining somatosensory chair
installations and VR technologies, transforming music into a new immersive experience; and “Curious
Alice”, a VR work co-produced with the world-renowned V&A museum. Moreover, “Curious Alice” wasdesignated as the highlight exhibition in this year’s festival.

Taipei Ambassador Theatres hosted the joint press conference of “Future Content in Progress. TAICCA X HTC X Venice Film
Festival”. Special VIPs (from left to right) are including director, Hsu Chi-Yen, VIVE ORIGINALS president, Liu Szu-Ming, the
TAICCA Chairperson, Ting Hsiao-Ching, Deputy Minister of Culture, Peng Chun-Heng, Deputy President, Hu Ching-fang,Ambassador Theatre President, Joe Chang, and director, Tang Chih-Chung whose works are shortlisted in “Out of CompetitionBest of VR” at the grand opening.

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Social Investment and Contribution

In addition to showcasing its works, HTC VIVE ORIGINALS was also invited to join the curatorial team of theinternational forums in organizing the invitation of speakers and arranging the agenda and related affairs,
which fully revealed its mastery of trends of future technological content and its competence in organizing
large-scale international forums.

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Blockchain trading platform
In order to integrate content developers, cultural creators, and offline distribution channels, we aim toenhance collaboration between content and commercial distribution channels to maximize the commercial
cooperation model. We developed a blockchain trading platform and aim to expand from the panentertainment industry to the fields of digital content, such as games, education, medical use, and more.
Based in Taiwan, we look forward to expanding to international markets and getting ahead of the game in
the virtual application market.
The platform is estimated to be activated in 2021, and the original IP contents of VIVE ORIGINALS will
first be put on shelves. Besides the safety of the platform trading, safety protection mechanisms for
digital artwork is important to us. Therefore, our partners do not need to worry about their works being
plagiarized. Blockchain platform in the future is no longer limited to digital art trades, but also to physicalartwork. Consequently, not only do we diversify the platform, but we also preserve the culture and art
industry.

Building a “Volumetric Capture Studio” to strengthen the width anddepth of immersive virtual experiences

VIVE Arts
VIVE Arts is a global initiative aimed at enhancing the artistic creation and appreciation through the latest
technologies. VIVE Arts established in 2017 exemplifies the unity of technology, humanity, and imagination that
forms the foundation and core values of the VIVE brand. In 2020, VIVE Arts continued the strategic collaboration
with top-class museums, cultural institutions, and artists around the world, which demonstrated our excellent
global influence. One of the most important collaborations is with the Victoria and Albert Museum (V&A Museum)in London, one of the most well-known museums in the world, to establish a breakthrough partnership. We
embodied the first VR experience of the museum with “Curious Alice”. VIVE Arts and the V&A Museum hosted
the first online virtual reality premier on October 22, 2020. Audiences around the globe could participate freely
through the “Engage” virtual platform. It was the first time the V&A museum was able to extend their exhibition
outside the museum, and to present the exhibition with a brand-new practice in the digital virtual world.
Cai Guo-Qiang, one of the world’s most celebrated artists, unveiled his first virtual reality artwork, “Sleepwalking
in the Forbidden City”, created in partnership with HTC VIVE Arts and exhibited at the Palace Museum, Beijing.
In “Sleepwalking in the Forbidden City”, the artist imagines a resplendent daytime fireworks ceremony that took
place six-hundred years ago, weaving together the past and present. It is also the first modern art exhibition the
Palace Museum curated. In 2020 VIVE Arts built important partnerships with art galleries in Taiwan, including the
Tainan Art Museum which exhibited the work of gouache pioneer, Hsueh -Hu Kuo. The theme of the VR work is “TheThree States of Home Gazing”, directed by artists Hsin-Chien Huang. Space, time, and experience are three kindsof VR interactions which enable audiences to enter Kuo’s studio and streets of Taiwan in the early 20th century,and feel Kuo’s nostalgia. In addition, we supported Taiwanese new media artist, Ya-Lun Tao, to create 10 pieces ofbrand-new VR works, and exhibited these in the Museum of Contemporary Art Taipei, which is another importantmilestone.
This series of iconic collaborations and exhibitions
were massively reported by international mainstream
media. Confronting the special condition around theglobe in 2020, innovative technology will demonstrate
the connectivity with the world and strength of eachother. VIVE Arts continues to assist museums torealize theirs missions of diversifying exhibitions andtransforming the experience and approaches of art
and culture audaciously.

As a production center for creative VR content, HTC VIVE ORIGINALS invests substantially in content
production and pipeline development, especially focusing on experimenting with diverse production
technologies for immersive experiences and digital pan-entertainment content. In 2019, we further
introduced the most cutting-edge and high-end volumetric capture studio in the world to conduct crossdisciplinary innovative pipeline development. On the basis of high-performance computing and 5G-basedtransmission, we hope to integrate diverse tools and technologies, such as 360 VR shooting, CG animation,
motion capture, and real-time engines. This will further support fields such as film and television, games,
education, and XR by creating more possibilities for future multi-sensory immersive experiences.

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Social Investment and Contribution

Other partnerships include the Galeries Nationales duGrand Palais, Centre Pompidou, Beijing X Museum,Tainan Art Museum, Kaohsiung Museum of Fine
Arts, and Museum of Contemporary Art Taipei. With
the participation of world-class museums in VR art
exhibitions, VIVE Arts will continue to expand anddeepen its partnerships with other cultural institutions
to bring more beautiful, meaningful, and innovative
VR experiences to people.

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London V&A Museum VR Experience -Curious AliceIn 2020, VIVE Arts collaborated with the V&A
museum of London to launch an unprecedented
VR art content, Curious Alice, and celebrated
the new exhibition of “Alice: Curiouser andCuriouser” launched in March, 2021. Audiences
can experience “Curious Alice” on the VIVEPORTand Steam platforms, entering the scenes
created by the illustrator, Kristjana S. Williams.
Audiences can further experience the scenesof capturing the White Rabbit’s missing glove,solving the Caterpillar’s mind-bending riddles,
visiting the Queen of Hearts croquet garden,
participating in the unfair game with the Playing
Cards, and more. Audiences can review these classical moments with characters in the wonderland.
Due to the pandemic, the V&A museum as well as museums around the world are not fully open to the
public. For the time being, digital creative content demonstrates their powerful connections to the world.
V&A Museum and VIVE Arts use the latest technology to provide a brand-new form of museum visits toaudiences, as well as creating magical experiences so everyone can be closer to inspiring and charming
wonderlands like Alice’s. This collaboration is a recognition of the V&A moving towards technologicalinnovation. The collaboration not only offers the opportunity to audiences who cannot visit the onsite
exhibition, but also turns to a new page in alliances between art and technology.
The V&A and VIVE Arts partnered with Preloaded to create “Curious Alice” on the Engage virtual platform.
“Alice: Curiouser and Curiouser” will be exhibited from March 27 until December 31, 2021.

193

Social Investment and Contribution

Cai Guo-Qiang to launch the VR firework “Sleepwalking in the
Forbidden City”
Asian artist Cai Guo-Qiang's retrospective
exhibition, "Odyssey and Homecoming",featuring a virtual reality work, “Sleepwalking
in the Forbidden City,” in collaboration with HTC
VIVE Arts kicked off at the Palace Museum in
Beijing in 2020.
"Odyssey and Homecoming" is curated by Sir
Simon Schama, and co-organized with the
Palace Museum in Beijing and the XXIV Olympic
Winter Games. The exhibition showcases 180
works along with Cai's "Journey of Western Art
History", a series of fireworks displays at a large
scale, as well as brand-new artwork especiallycreated for this exhibition.
Cai’s first virtual reality work, “Sleepwalking
in the Forbidden City” was exhibited at the last hall of the retrospective. The VIVE Pro headsets take theaudience back to periods hundreds of years ago. Sometimes audiences are within the giant marble model;
sometimes they are flying through fireworks in the sky. The exhibition comprises of three elements, a large
marble model of the Forbidden City, cascading fireworks, and a VR work that is fused with all elements.
The production process incorporates 3D scanning and modeling, 360-degree filming, and CG technologies.
Audiences can experience the grand opening composed with golden, silver, and red fireworks, to glittery
sparks, and then to the sun shining on the double-eaves roof of the palace. Colorful smoke and pigments
fall on audience’s white world, transforming the Forbidden City’s architecture into a phenomenal 3D
gunpowder paining.

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194The Kaohsiung Museum of Fine Arts “The Universe”, by Liu KuoSung, in memory of Liu’s 70 years in Taiwan
2019 was the 70th anniversary (1949-2019) of
the father of modern Chinese brush strokes,
Liu Kuo-Sung. The Kaohsiung Museum of Fine
Arts in Taiwan curated the exhibition “To theMoon: Liu Kuo-Sung”, in memory of Liu’s 70
years in Taiwan. The works on display areclassified by subject matter into the “Calligraphic
Abstraction”, “Space”, “Water Rubbing”, “Steeped
Ink” and “Tibetan Suite” series. The dates ofthese works span the half-century period from1964 to the present. Among them you find theone in collaboration with VIVE Arts and VR technology - the reconstructed work of Liu’s “The Universe”.
“The Universe” VR was directed by new media creator, Huang Hsin-Chien, and director, Chang Wen-Chieh.
Through the VIVE Pro and the immersive three-part exhibition, viewers are invited to “See ( 觀 ),” “Play( 戲 ),”and “Enter ( 入 ) ” his universe with a bird’s-eye-view perspective. These match Liu’s three painting
styles of “The Big Ban( 開天闢地 )”, “Painting as Chess ( 畫若佈弈 ) ”, and “Earth ( 地球何許 ) ”. From themountains and rivers in nature to the scenery of the universe, viewers can experience the mystery of thesun, moon, earth, and ultimate space. And finally, the sun and planets return to Liu’s brush and become ink
blots, completing the artist’s journey of ink.

195

Social Investment and Contribution

Pompeii, the VR experience at Grand Palais Salon d’Honneur, Paris
The UNESCO World Heritage City of Pompeii, frozen in time when
it was destroyed by the eruption of Mount Vesuvius in 79AD, boasts
the most extraordinary artefacts from ancient Rome and is visitedby nearly four million visitors every year. Recent archaeologicalinitiatives have continued to reveal surprising discoveries. Ina luxurious mansion, several colorful walls with two frescoes
preserving rich colors and details were found. Other than that, alleys,alters, and exquisite amphora that were used to preserve wine andbutter were also unearthed - called by archaeologists the “marvelous
discoveries”.
To share these discoveries with the public, the Réunion des Musées
Nationaux – Grand Palais in Paris presented a spectacular immersive
digital exhibition, Pompeii, from July 1, 2020 until October 29, 2020.
With the support of VIVE Arts and VR technologies including laser
mapping, infra-red thermography, high-definition photogrammetry,and masterful 3D architectural and environmental reconstruction,
this allowed visitors to experience the dynamic life in the city
before its destruction, the tragic disaster of the eruption, as well as
astounding archeological efforts since the 18th century.

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Tao Ya-Lun solo exhibition, “Ubiquitous Ghosts”
Tao Ya-Lun graduated from the Department ofFine Arts of National Taiwan Normal University
in 1993. He has a master’s degree from theInstitute of Plastic Art in Tainan National
University of The Arts. He is now a professor of
the College of Communication of the National
Chenchi University. The themes of his work
mainly focus on human existence and conditionsin the era of information technology, digging
into the interactions among body awareness,
consciousness movement, and virtual and reality
spaces. The media of his creations range fromearly video, sound, machine installation, lighting
art, to more recently, art related to AR and VR. Tao can be called a pioneer of Taiwan’s new media art.
“Ubiquitous Ghosts”, a solo exhibition comprising all new works of Tao, ran at the Museum ofContemporary Art (MOCA) in Taipei from August 22 to November 1, 2020. Lingering between the real andthe virtual, body and mind, even modern technology and humanity, Tao tries to find an answer whether
technology could be everywhere around us, and even take over our souls. The “present” audiences will beallowed to enter 10 “non-present” spaces to experience different simulated historical scenes. Audiences
stand at the electrical tracks installed by the artist with the VIVE Pro headsets, and their bodies traverse
within the space as if they were drifting ghosts. Through the deployment of simulated circumstances andInstallations in a hundred- year-old venue, Tao creates an extraordinary superposition of history that calls
for memories of place. In the exhibition, Tao tries to liberate us from physical restraints through digitaltechnology, and create a narrative scene where we can travel through the past, present, and into the future.

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Social Investment and Contribution

Kuo Hsueh-Hu’s “The Three States of Home Gazing”, created withdigital technology for a VR experience artwork“The Reminiscence of Taiwan in His Heart” is one of Tainan Art
Museum’s major exhibitions aimed at reconstructing the art historyof Taiwan. The project originated from “Home Gazing: My Father Kuo
Hsueh-Hu's Life in Art”, the biography published by Mr. Kuo SungNien in memory of his father, a legendary artist and one of Taiwan's
first-generation gouache painters. Following the memoir, theexhibition offers a pluralistic and global perspective to examine Kuo’s
domestic and international artistic achievements over the years,
allowing viewers to imagine the artist as a home-gazing wanderer
whose journey is both external and internal. The exhibition was onview from March 21 through July 5, 2020, in Hall A-D of Tainan Art
Museum Building 2.
In addition to presenting Kuo’s sketches, original paintings, andarchives in sections, the exhibition also features a VR experience,
titled “The Three States of Home Gazing”. This VR experience isbased on three of Kuo’s renowned paintings: “The Setting Sun by theFort Provintia” (1986), “Boats Moored in Tamkung” (1982), and “Festival on South Street” (1930). It offers
three types of interactivities to explore the concepts of space, time, and experience, respectively, allowing
the visitors to travel from Kuo’s painting studio in the earth 20th century to important sites featured in his
paintings. These include the South Street in Tuā-Tiū-Tiânn, City God Temple, Guanyin Mountain, TamsuiRiver, and the flourishing folk life of downtown Tainan. The experience is ultimately a journey into theartist’s poignant home-gazing.

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VR for Impact Program
HTC VIVE announced VR for Impact in 2017, an interactive and immersive experience HTC VIVE that will create
positive impact and change in support of the United Nation’s Sustainable Development Goals. It is dedicated tochange the development in education, health, medicine, art, and many other fields. In 2020, due to the impact of
COVID-19, VIVE’s VR for Impact was called off. The status of the program is that it is supportive of several ongoingprojects and completed ones, as well as looking for new approaches to connect with global residents who careabout humanitarian issues and wish to make meaningful changes.

“Kusunda” is a VR experience work that explores the indigenous language in Nepal. It was funded by VR for
Impact in 2020 and was premiered at the Tribeca Film Festival in spring 2021. Before the release, creator Gayatri
Parameswaran, went to Nepal to showcase Kusunda to the local community who participated in the film.
Kusunda will be broadcasted at VIVEPORT in 2022.
Website:https://www.nowheremedia.net/kusundavr

In 2019, the LIFE VR program was in collaboration with Engage as well as Oxford University, to initiate lifesaving
training for doctors and nurses. Researchers at Oxford wish to head to Kenya in 2021 and plan to conduct theonsite training with the HTC VIVE Focus Plus headsets.
Website:https://oxlifeproject.org/

VR for Impact and the National Geographic Society co-funded and co-produced “Hydrous” which was releasedon YouTube and other platforms in 2020 with over forty million viewers. Due to COVID-19, more content will be
released in the near future.

In 2020, VIVEPORT released new influential VR films and content, including the Emmy Award-winning
producer, Lynette Wallworth’s VR experience work, “Awavena”. The film was in collaboration with the
Yawanawa community in the Amazon, and is a documentary filmed with VR technology and equipment of thefirst female shaman of the community in history. In order to be qualified for the 2020 Emmy Award, VIVEPORT
exclusively released Awavena and won an Emmy Award for Outstanding New Approaches to Documentary.
Website:https://blog.vive.com/us/2020/09/18/celebrating-emmy-nominated-VIVEPORT-title-awavena/

Website:https://thehydro.us/

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Social Investment and Contribution

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Due to the limitations of COVID-19, many leading events and festivals were transformed to online VR release,including the project of Venice VR Expanded of the Venice Film Festival. VIVEPORT created a series of VR films
and themes on humanitarian issues, such as Home, QueerSkins: Ark, Once Upon a Sea, 4 Feet High, Minimum
Mass, and so on.
Among them being “The Book of Distance”, based on an immigrant’s emotional true story. It is told from theperspective of the third generation, and artist Randall Okita, leads us through an interactive virtual space to be
involved in Okita’s family in distant Canada, to recover what was lost. The producer, the National Film Board of
Canada, decided to offer free downloads to attract more audiences.

Website:https://www.VIVEPORT.com/f07e3298-b20c-4029-b666-b4e3991abc18

Blood Donations
2018

2019

2020

Eight times every year HTC cooperates with the
Taipei Blood Center and Hsinchu Blood Center to hold
Number of incumbents
4,096
3,226
2,206
blood donation drives. Many of our kind-hearted
Blood Donation
695
799
553
employees have developed the habit of regular blood
Donation Rate %
16.97
24.76
25.06
donation since 2006. Every time the mobile vehicle
from the Blood Center comes by our employees all
Total blood donation (ml)265,250
300,250
205,000
line up to make donations to give back to society. HTC
Note: The annual number of incumbents only counts the number in Taiwan
is recognized by Hsinchu Blood Center as a standing
Honorable Blood Donor Group. In 2020, employees
responded enthusiastically to blood donation activities, the total blood donated in HQ & Plants was 74,250 ml,
while the total blood donated in Taipei Office was 130,750 ml.

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 Taiwan Fund for Children and Families (TFCF) to support thesponsorship of children in need. In 2020, a total of 46 children were adopted, including 38 in China and 8 inforeign countries (including Guatemala, Jordan, the Philippines, Senegal, Sri Lanka, Kyrgyzstan, and Paraguayetc.).

The Charity Concert
The Taitung Joy After-school Program set
up charity stalls in TPE1 and in our lobby in
Taoyuan during Mother’s Day in 2018 andChristmas in 2019. This greatly lifted the spiritsof the children and gave them a sense of
support. The Taitung Joy After-school Program
was founded in September 2015. Due to a tightbudget, we are only able to accept 50 children,
In October 2018, we managed against all odds
to find a violin band. We hope that throughlearning to play music and the power of music
and dance, the children would be able to fill
their lives with joy and overcome the diculties.
In 2020, the children from the Taitung Joy Afterschool Program were invited to perform at a music event held in the Auditorium of the Chiang Kai-shek
Memorial Hall. Before the event, we invited them to HTC to perform for the workers. They were all very
nervous before the concert but also grateful for the support and love they received from the kind-hearted
gentlemen and ladies from HTC. We post a notice for our staff, encouraging them to make a small monthly
donation to the Taitung Joy After-school Program, in the hope of fulfilling our duty to society and lend ahelping hand to those in need.

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Social Investment and Contribution

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HTC Christmas Event in 2020: Passing Down the Love

Summary of the communities and associations participated
Organization Name

HTC received many blessings and love during2020 when the COVID-19 pandemic. To express
our gratitude to each of our sta and theirfamilies, we held the “HTC Christmas Event in
2020: Passing Down the Love” on the Christmas
Eve of 2020.
We invited various groups to share the delightful
Christmas spirit with us, including the Taiwan
Foundation for the Blind, the Down Syndrome
Foundation R.O.C, the New Life Church, theWulai Atayal Wild Honey and many others. The
event featured live concerts, a charity fair fullof goodies, and much more. Employees wereinvited to enjoy the event and pass down thelove together. Our Food & Beverage Department
has also prepared soft drinks, coffee, coldbrewed tea, as well as assorted cake slices anddesserts for our staff.
Our CEO Cher purchased all items for sale inthe charity fair and gave them to the employees
as mystery grab bags. At the end of the day,we raised over NTD $220,000 in charity
donations from the charity fair, motivating all
managers and employees to consistently makecontributions to charity and pass down the loveto those in need.

SDA (Secure Digital Card Association)

General member

Wi-Fi ( WECA Wireless Ethernet Compatibility Alliance)

General member

TCA (Taipei Computer Association)

General member

GSM Association

Social Investment and Contribution

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)

MemberNMEA (New Media Entertainment Association)

Group member

JBRC (Japan Battery Recycling Collection)

General member

Taoyuan importers & exporters chamber of commerce

General member

CCSA (China Communications Standards Association)

General member

OPEN Alliance (One-Pair-EtherNet 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

CTIA (Cellular Telecommunications Industry Association)

203

Membership

Operators and industry members
Member of the board

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204

The 2020 management approach and its components
Standard

Material topics

Economic performance

How HTC manages the topic

Pay attention to corporate governance and operational transparency, and formulate and implementa corporate governance structure in accordance with relevant laws such as the “Company Law”
and “Securities Exchange Act” , and continuously improve management performance.

The purpose of the management approach

Properly and effectively assign the powers andresponsibilities of the board of directors, managers,
and shareholders to establish and maintain an
operating team that is accountable to shareholders
Protect the rights of investors and other interested
parties through a comprehensive and systematic CSR
implementation system.

EconomicInnovation Management
Information Security

Introduced “personal data management system” and “information security management system” .
The legal, product safety, and information security departments are working together as a team topromote privacy protection and information security.
Intellectual property rights protection covers four areas: patents, trademarks, copyright, and trade
secrets. Of these, patent protection is particularly valued and is realized at two levels: Internal andExternal
Encourage employees to recommend outstanding professionals needed by the company andprovide incentives

Related policies“Corporate Governance Practice Principles”“HTC Code of Conduct”“Rules for Derivatives Transaction”“Regulations for the Appointment of Directors/
Supervisors in Re-investment”“Board of Directors Rules of Procedure”“HTC Information Security Policy”
In order to ensure that information security and“Personal Information Protection Management
privacy protection are fully integrated into the
Policy”organization's culture and the company's core values, “Privacy Policy”
HTC actively establishes and promotes information“Patent Management Policy”“Notice and procedures for copyright infringement
security and personal information protection
complaints”
policies, ensuring that they are in compliance with
“ Referral Policy”
relevant information security and privacy protection
regulations from various countries.

Protecting the intellectual property as well as
enhancing the competitiveness.

Grievance mechanisms

Investor Liaison:
Tel: +886-2-8912-4138
E-mail: ir@htc.com
Company spokesperson andinvestor relations:
Shen Daobang spokesman@htc.
com
Internal: e-mails, announcement
methods
External for Information Security:
global-privacy@htc.com,
security@htc.com
External for Intellectual property
rights:Global-Copyright@htc.com

Enable employees to exert their strengths to the bestof their ability, and encourage employees to continue
to contribute to their positions and continue toinnovate.

Environmental
SocialEffluents and Waste
Supplier Environmental
Assessment
Environmental
Compliance
EnergyEmission

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

Employment
Labor Management
RelationsOccupational health andsafetyEmployee diversity andequality
Human Rights
Assessment
Forced or Compulsory
Labor
Non-discrimination

HTC has a well-established parental leave application mechanism to protect the rights of employees.

Ensure the rights and interests of all employees.

Provide diverse and fair employment opportunities for employees.

Promote good labor relations.

The board of directors set up a salary compensation committee to assess the salary andremuneration policy and system of the directors, supervisors, and managers and achievement of
performance goals.

Protect the labor rights of multiple employees.

Set up sewage treatment equipment in the plant area, and regularly test and report online.
Entrust lawful disposal agencies to properly dispose of wastes, and carry out irregular inspections
Periodic inspections of waste storage and temporary storage areas will be conducted throughinspection schedules.
Establish supplier evaluation and management system
Refer to the “Code of Conduct for Responsible Business Alliances” to develop relevant
environmental specifications in the “HTC Supplier Code of Conduct” to periodically assess
suppliers' compliance with and implementation of the Code.

Extend the concept and requirements of social
responsibility management to the supply chain andimplement supply chain responsibility.

Reduce the turnover rate of employees.
Reduce the risk of workplace hazards to employees
and reduce occupational hazards.

The company convenes a labor-management conference every quarter and records and tracks
problems and improves results.

Attract and retain outstanding talents.

The Ministry of environmental and the occupational safety dept. are responsible for the
implementation of the occupational safety and health and energy management system and draw
up the annual plan.

Build inspection standards for hazardous substances.
Mark product information, and add environmental protection material certification on the packaging.
Set up internal control mechanisms to control technical data, software and hardware, 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 and management mechanism.
Reference Responsibility Business Alliance Code of Conduct Developing “HTC Supplier Code of
Conduct” , and periodically assess whether suppliers meet and implement the guidelines.
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.

205

Reduce the impact of operations on the naturalenvironment.

Provide attractive, motivating salary and benefits programs.

Establish a multi-faceted employee complaint channel.
Customer Health and
SafetyCustomer Privacy
Socioeconomic
Compliance
Supplier Social
Assessment

Reducing waste through classification and advocacy, “ESH Management Manual”“HTC Corporate Social Responsibility Policy”
and increasing the efficiency of recycling.

The 2020 management approach and its components

Reduce the negative impacts of end career
employees.
Set up a benign environment of free communication
so as to improve work motivation and efficiency.

Ensure that the products are non-toxic andharmless green products and comply withnational laws and customer specifications.
Protect customer health and safety.
Protect customer privacy.
Reduce product harmful substances andpackages.
Conformity to relevant socioeconomic regulations.

“Process for Removal and Handling Business
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 HealthManagement Procedures”“Environmental, Safety and Health, and Energy
Regulations Requirements Management
Procedures”“Supplier Environmental, Safety and Health, andEnergy Management Procedures”“HTC Code of Conduct”“Customer Satisfaction Management Program
Specification”“HTC Corporate Social Responsibility Policy”“Modern Slavery Act Statement”“Employee Grievance Procedure”“HTC ESH Policy”“ESH Management Manual“ “Safety and Health
Rules”“HTC hazardous substance management policy”“HTC Supplier Code of Conduct”“HTC Information Security Policy”“Personal Information Protection Management
Policy”“Privacy Policy”“Customer Service Privacy Protection Declaration““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, andEnergy Management Procedures”

Internal: e-mails, announcement
methods, proposal improvement
bills, or discussions with the Healthand Safety Committee
External stakeholders can filean appeal through Corporate
Social Responsibility Corporate_
responsibility@htc.com. The casewill be transferred internally to
the EA. According to the “EP00000010 Procedures for
the Control of Environmental
documents”
The grievance mechanism
includes employee complaint
hotline, complaint suggestion
box, grievance e-mail, and sexual
harassment grievance mail box
Manufacturing employees of the
production line company extension
38585
Other general employees company
extension 28585
Employee helpline e-mail
HelpMe_8585@htc.com

Customer service hotline: 0809090-166, please call: 02-2162-6788
Set up local customer service
hotlines in 11 countries around theworld
Build more than 59 websites indifferent countries
Provide PR, Service, Copyright,
Security and other different typesof e-mailHTC 2020 CSR Report2062020 Management Approach
Standard

Material Topic

Mechanism of Evaluation

GRI Standards Content Index

The result of Evaluation( Page and Corresponding titles )Economic
Environmental

Economic performance

Independent director,
Audit committee, Internal Audit System
Corporate Governance Evaluation of TWSE

P026 Overview of Financial Performance
P055-057 Corporate Governance

Innovation Management
Information Security

Personal Information Management System
Information Security Management System
Patent management

P062 Privacy protection and information security risk
management

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

P048 CSR Management Procedures and Systems
P073 GHG Emission and Reduction
P097 The Amount of Water Discharge and Recycled
Water, and the Average Concentration of BOD
P102-108 Sustainable Design
P109-112 Hazardous Substance Management
P112 Active in Compliance with Standards
P113-122 Sustainable Manufacturing Process
P117 Hazardous Substances and Chemical Control
P124-125 Environmentally friendly with sustainable
packagingP126-127 Sustainable Supplier Chain

Effluents and Waste
Supplier Environmental
Assessment
Environmental
Compliance
EnergyEmissions

P045-048 The mechanism for Committee Operation
P055-057 Corporate Governance
P126 Statement on Uyghur Human Rights Issues in ASPI
Annual Report
P135-140 Staff Management
P140 Care for Foreign Employees
P150-152 Diversified Employee Welfare
P157-160 Listening to the Voice of the Employee

P088-090 Corporate Customer Satisfaction
Management
P109-112 Hazardous Substance Management

Customer Healthand Safety

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

P062-068 Privacy protection and information security
risk managementP088-090 Corporate Customer Satisfaction
Management

Other social and economic related
regulations (domestic and foreign)

P046 The HTC “Corporate Social Responsibility (CSR)
Policy”
P057 Complete Disclosures
P058-059 Strict Mechanisms for Avoiding Conflicts ofInterest
P063 Structure of HTC's personal information
management system
P102-108 Sustainable Design
P126-131 Sustainable Supplier Chain
P135 Human Rights and a High Standard of Professional
EthicsSocialEmployment
Labor Management
RelationsOccupational Health and
SafetyDiversity and Equal
Opportunity
Human Rights Assessment
Forced or Compulsory
Labor
Non-discrimination

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

Customer Privacy

Socioeconomic
Compliance

Supplier Social
Assessment

Responsible Business Alliance (RBA)
Supplier Management

GRI Standard

GRI 102 :GeneralDisclosures
2016

P046 The HTC “Corporate Social Responsibility (CSR)
Policy”
P126-131 Sustainable Supplier Chain
Note:

207

2020 Management Approach

Disclosed Topic

Page and Corresponding titles

102-1

Name of the organization

P009 About HTC

102-2

Activities, brands, products, and services

P009 About HTC

102-3

Location of headquarters

P012 Global Operation Locations

102-4

Location of operations

P009 About HTC

102-5

Ownership and legal form

P009 About HTC

102-6

Markets served

P012 Global Operation Locations

102-7

Scale of the organization

P009 About HTC
P013-018 Industry Overview
P026 Overview of Financial Performance
P136-137 HTC Human Resource Structure Overview

102-8

Information on employees and other workers

P136-139 HTC Human Resource Structure Overview

102-9

Supply chain

P015-016 Industry Overview

102-10Significant changes to the organization and its supply chain

Please refer to Market Observatory Post System:
http://mops.twse.com.tw

102-11

Precautionary Principle or approach

P062-072 Risk Management102-12External initiatives

P126-127 Sustainable Supplier Chain
P213 The United Nation's Sustainable Development
Goals

102-13

Membership of associations

P204 Summary of the communities andassociations participated102-14

Statement from senior decision-makerP007-008 Statement of the Management102-15Key impacts, risks, and opportunities

P062-072 Risk Management102-16

Values, principles, standards, and norms of behavior

P027-030 The Pursuit of Brilliance102-17

Mechanisms for advice and concerns about ethics

P055-090 Responsibility Management102-18Governance structure

P045 The mechanism for Committee Operation
P055-058 Corporate Governance102-20Executive-level responsibility for economic, environmental,
and social topics

P045-048 Corporate Social Responsibility
Management102-21

Consulting stakeholders on economic, environmental, andsocial topics

P045-048 Corporate Social Responsibility
ManagementP051-052 Diversified Channels for Transparent
Information Disclosure102-22Composition of the highest governance body and its
committees

Please refer to HTC 2020 Annual Report P32-33,
90, 94102-23Chair of the highest governance body

Please refer to HTC 2020 Annual Report P32

102-24

Nominating and selecting the highest governance body

Please refer to HTC 2020 Annual Report P32

102-32Highest governance body's role in sustainability reporting.

P045 Corporate Social Responsibility Management102-36

Process for determining remuneration

P056 Compensation Committee

Remarkrepresents the topic disclosed voluntarily by HTC, not a major topic identified in 2020

HTC 2020 CSR Report

208

GRI Standard

Disclosed Topic
102-40

List of stakeholder groups

P051-052 Diversified Channels for Transparent
Information Disclosure102-41

Collective bargaining agreements

P051 Diversified Channels for Transparent
Information Disclosure
P157 Listening to the Voice of the Employee

102-42

Identifying and selecting stakeholders

102-43

Approach to stakeholder engagement102-44

Key topics and concerns raised

102-45

Entities included in the consolidated financial statements

Please refer to HTC 2020 Annual Report P194
The main manufacturing and operating bases ofthe scope disclosed in the CSR report: Taiwan

Defining report content and topic Boundaries

P001 Report Scope and Boundary
P047-048 CSR Management Procedures andSystems
P049-050 HTC 2020 Material Issues and Boundary

102-46
GRI 102 :GeneralDisclosures
2016

GRI 103 :Management
Approach 2016

Page and Corresponding titles

Note:

GRI Standard

102-47

List of material topics

P050 HTC 2020 Material Issues and Boundary

102-48

Restatements of informationNone

102-49Changes in reportingNone

102-50

Reporting period

P002 Editorial Principle

102-51

Date of most recent report

2020/06

102-52

Reporting cycle

P002 Time Coverage of Disclosure102-53

Contact point for questions regarding the report

P004 Contact us

102-54Claims of reporting in accordance with the GRI Standards

P002 Report Basis102-55

GRI content index

P208 GRI Standards Content Index

102-56External assurance

P221-223 Assurance Statement

103-1

Explanation of the material topic and its Boundary

P050 HTC 2020 Material Issues and Boundary

103-2

The management approach and its components

P070 Sustainability Management Vision
P205 The 2020 management approach and its
components

103-3

Evaluation of the management approach

P207 2020 Management Approach

201-1

Direct economic value generated and distributed

201-2

Financial implications and other risks and opportunities due
P069-072 Management of Climate Change Risk
to climate change

201-3

Defined benefit plan obligations and other retirement plans P148-152 Sound Wage and Welfare System

Disclosed TopicGRI 202 :Market-Presence 202-1
2016
GRI 205 :Anti-Corruption
2016P051-052 Diversified Channels for Transparent
Information Disclosure

Topic-Specific Disclosures: GRI 200 (Economic topics)

GRI 201 :EconomicPerformance
2016

RemarkGRI 207 :Tax
2019

Page and Corresponding titles

RemarkRatios of standard entry level wage by gender compared to P148 HTC Regular Earnings Ratio for Men andlocal minimum wage
Women in Taiwan

205-2

Communication and training about anti-corruption policies P058-059 Strict Mechanisms for Avoiding Conflicts
and proceduresof Interest

205-3

Confirmed incidents of corruption and actions taken

None

207-1

Approach to tax

P060-061 Tax Management

207-2

Tax governance, control, and risk management

P061 Tax and Risk Management

207-3

Stakeholder engagement and management of concerns
related to tax

P061 Stakeholder Engagement

Topic-Specific Disclosures: GRI 300 (Environmental topics)

GRI 302 :Energy2016

GRI 305 :Emissions
2016

GRI 306 :
Waste
2020

GRI 307 :Enviromenetal
Compliance
2016

302-1

Energy consumption within the organization

P074 Energy Consumption Analysis
P078 The Use of Green Energy

302-4

Reduction of energy consumption

P074-077 Energy-saving and carbon reduction
Actions
P122 Energy and paper saving measures

305-1

Direct (Scope 1) GHG emissions

305-2

Energy indirect (Scope 2) GHG emissions
P073 GHG Emission and Reduction

305-3

Other indirect (Scope 3) GHG emissions

305-5

Reduction of GHG emissions

306-1

Waste generation and significant waste-related impacts

P113-115 Hazardous Waste Management

306-2

Management of significant waste-related impacts

P105-107 Product Recyclability Design

306-3

Waste generated

P113-115 Hazardous Waste Management

306-4

Waste diverted from disposal

P113-117 Hazardous Waste Management

307-1

Non-compliance with environmental laws and regulations

None

308-1

New suppliers that were screened using environmental
criteria

P127-128 The green supply chain management
system308-2

Negative environmental impacts in the supply chain andactions taken

P128 The HTC Supplier CSR Assessment and Audit

P026 Overview of Financial Performance

GRI 308 :Supplier
Environmental
Assessment
2016

represents the topic disclosed voluntarily by HTC, not a major topic identified in 2020

209

GRI Standards Content Index

HTC 2020 CSR Report210

GRI Standard

Disclosed Topic

Page and Corresponding titles

Topic-Specific Disclosures: GRI 400 (Social topics)

GRI 401 :Employment
2016

GRI 402 :Labor
Management
Relations
2016

GRI 405 :Diversity and
Equal
Opportunity
2016

Note:

GRI Standard

Disclosed Topic

Page and Corresponding titles

GRI 406 :NonDiscrimination
2016

406-1

Incidents of discrimination and corrective actions taken

P135 Human Rights and a High Standard ofProfessional Ethics

409-1

Operations and suppliers at significant risk for incidents offorced or compulsory labor

P126 Sustainable Supplier Chain

401-1

New employee hires and employee turnover

401-2

Benefits provided to full-time employees that are notprovided to temporary or part-time employees

P150-152 Sound Wage and Welfare System

GRI 409 :Forced orCompulsory
Labor 2016

401-3

Parental leave

P156 Work-life Balance Support

GRI 410:
Security
Practices 2016

410-1

Security personnel trained in human rights policies orprocedures

P162 Professional Security Service Team

402-1

Minimum notice periods regarding operational changes

P157 Labor-management Agreement and
Employee Rights

GRI 412 :Human Rights
Assessment
2016

412-2

Employee training on human rights policies or procedures

P100 New employees and on-the-job staff
education training in the past 3 years
P135 HTC Code of Conduct403-1

Occupational health and safety management system

P161 Occupational Safety and Health Committee

414-1

New suppliers that were screened using social criteria

P135 Human Rights and a High Standard ofProfessional Ethics

403-2

Hazard identification, risk assessment, and incident
investigation

P172-174 Positively Preventing Occupational
Accidents, Contractor Management

414-2

Negative social impacts in the supply chain and actions
taken

P128 The HTC Supplier CSR Assessment and Audit

403-3

Occupational health services

P169-172 Occupational Health

Assessment of the health and safety impacts of productand service categories

P109 Hazardous Substance Management
P112 Active in Compliance with Standards

403-4

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

P161 Occupational Safety and Health Committee

Incidents of non-compliance concerning the health andsafety impacts of products and services

None

Worker training on occupational health and safety

P174 2020 Full-time Environmental Safety and
Health Personnel Training

417-1

Requirements for product and service information andlabeling

P124-125 Environmentally friendly with sustainable
packaging

417-2

Incidents of non-compliance concerning product andservice information and labeling

None

417-3

Incidents of non-compliance concerning marketing
communications

None

GRI 403 :403-5
Occupational
Health and Safety
2018
403-6

GRI 404 :Training andEduction
2016

P139 2020 HTC New Recruits/ Turnover of
Employees Worldwide Statistics

RemarkPromotion of worker health

P166-168 Health Management, Annual Health
Check Subsidies and abnormal tracking, Health
Promotion Programs

403-7

P118 Hazardous Substances and Chemical Control
Prevention and mitigation of occupational health and safety
P128 The HTC Supplier CSR Assessment and Audit
impacts directly linked by business relationships
P174 Contractor Management

403-9

Work-related injuries

P176 2020 Occupational injury in Taiwan Plant

403-10Work-related ill health

P176 Recordable Occupational Disease Rate

404-1

Average hours of training per year per employee

P147 Employees Training Hours and Sex Ratios at
All Levels in 2020

404-2

Programs for upgrading employee skills and transition
assistance programs

P142-147 Complete Education and Training Plan

404-3

Percentage of employees receiving regular performanceand career development reviews

P144 Training and Performance Integration
P147 Training Result

405-1

Diversity of governance bodies and employees

P055-057 Organization StructureP136-139 HTC Human Resource Structure Overview
P141 Engaging Diversified Talent405-2

Ratio of basic salary and remuneration of women to men

P148 HTC Regular Earnings Ratio for Men and
Women in Taiwan
P148 HTC Average Compensation Ratio for Men
and Women in Taiwan

GRI 414 :Supplier Social
Assessment
2016

GRI 416 :416-1
Customer Healthand Safety
416-2
2016

GRI 417 :Marketing andLabeling
2016

GRI 418 :Customer Privacy 418-1
2016

P087 Protection of Customer Confidentiality
Substantiated complaints concerning breaches of customer
P062-063 Privacy protection and information
privacy and losses of customer data
security risk management

GRI 419 :Socioeconomic
Compliance2016

Non-compliance with laws and regulations in the social andP157-160 Listening to the Voice of the Employee
economic area

419-1

Remarkrepresents the topic disclosed voluntarily by HTC, not a major topic identified in 2020

211

GRI Standards Content Index

HTC 2020 CSR Report

212

The United Nation's Sustainable Development Goals

HTC’s Performance in Response to the UN’s SDGs : Key Objectives
SDGs

In 2015, the United Nations passed 17 Sustainable Development Goals (SDGs) aimed at ensuring peace and prosperity
for all people. Each goal also details specific goals to be achieved in the next 15 years, thereby establishing the guidelineand blueprint of the future sustainable development direction, serving as a global sustainable development agenda andaction appeal. In order to achieve a more sustainable future, companies, governments, and society need to fulfill their
responsibility and make an effort.

SDGs 3 :Good Healthand Wellbeing

As global citizens, we spare no effort to implement the goals of the United Nations. We are committed to integrating SDGs
into corporate operations and business development planning In addition to establishing gender equality in practiceand 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 promote sound health and well-being of people of all ages, while establishingmultiple partnerships with teams from different fields to accelerate the implementation of goals.

Key performances of sustainability development

Page and Corresponding titles

In terms of employee health, we established the employee clinic, gym, basketball court, and other such facilities for our
employees. Furthermore, we put together our vision and technology to assist with medical care, health, and hygiene-related
issues, as well as strengthening prevention measures.
The best helper for prevention, “Disease Control Butler 3.0” , Linebot.

P036 The best helper for prevention, “Disease Control
Butler 3.0” Linebot“Disease Containment Expert Line Bot” that helps officers for homecare.

P037 “Disease Containment Expert Line Bot” that helps
officers for home care

HTC, Taipei Tzu Chi Hospital, and Taiwan Society of Simulation in
Acute and Critical Care Medicine collaborate to establish a “COVID-19
VR Medical Simulation Center” .

P039 HTC, Taipei Tzu Chi Hospital, and Taiwan Society ofSimulation in Acute and Critical Care Medicine collaborate
to establish a “COVID-19 VR Medical Simulation Center”

VIVE X Innovation team to cultivate education and science research:
Expedite the developing and learning processes of VR to enhance
the R&D of COVID-19 medicine and vaccines.

P041 VIVE X Innovation team to cultivate education andscience research: Expedite the developing and learning
processes of VR to enhance the R&D of COVID-19 medicine
and vaccines

HTC in collaboration with Chunghua Christian Hospital to launch thefirst cross-hospital AI+ Blockchain Medical Care Line Bot, Dr. Lan.

P038 HTC in collaboration with Chunghua Christian
Hospital to launch the first cross-hospital AI+Blockchain
Medical Care Line Bot, Dr. Lan

Medical VR team is expediting the development of the global
medical VR ecosystem, and working with VR developers to carryout new medical VR technology in reality.

P181 Enhance medical education and quality through VR

HTC curated a series of virtual reality content that is fun withworkout functions through VIVEPORT.

P041 HTC VIVE Infinity Supports prevention, virtual workout
increases immunity

LIFE VR program in collaboration with Engage as well as Oxford
University to initiate lifesaving training for doctors and nurses.

P199-201 VR for Impact Program

HTC has established an “employee clinic” to provide employees withprofessional medical consultation, as well as excellent physiotherapy
and health management services.

P166 Health Management

HTC Employee Clinic will organize seminars and health promotion
activities from time to time every month.
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.

SDGs 4 :Quality
Education

Eight times every year HTC cooperates with the Taipei Blood Centerand Hsinchu Blood Center to hold blood donation drives.

P202 Blood Donations

HTC provides a gym, an indoor basketball court, a badminton court,
and so on. We also commissioned sports professionals on-site toprovide advice on sports skills and injury prevention.

P155 Health and fitness corporate certification

HTC collaborates with professional catering vendors, providing
certified meals and healthy drinks.

P162-163 Food Safety - Hearty and Healthy Meals at HTC

With quality education, virtual reality technology and education combined and a full range of software and hardware
support, VIVE visualizes abstract knowledge, turning learning into an experiential journey immersed in virtual space and fully
revolutionizing existing forms of education.
Collaborated with the New Taipei Municipal New Taipei Industrial
Vocational High School by joining the “Demo Day” project, andestablished the “VIVE training center” .

213

The United Nation’s Sustainable Development Goals

P168 Health Promotion Programs

P183 Alliances with schools to establish VR talent incubators

HTC 2020 CSR Report

214

SDGs

SDGs 4 :Quality
Education

SDGs 9 :Industry,
Innovation,
andInfrastructure

Key performances of sustainability development

Page and Corresponding titles

Use virtual reality technologies to improve the traditional firefighting
field training, which can greatly strengthen the stress resilience andproblem solving skills of firefighters.

P182 HTC uses virtual reality skills to assist in lowering
firefighting training risks

VIVE Arts is committed to the development of the global virtual
reality art and culture arenas, and is in collaboration with museums
and content developers.

P192-198 Other Social Engagement Activities: VIVE ArtsThe Hydrous Presents: Immerse:
VR for Impact and the National Geographic Society co-funded andco-produced “Hydrous” that was released on YouTube and otherplatforms in 2020.

P199-201 VR for Impact Program

In order to encourage employees to continue learning, a total of 20
English courses have been conducted in 2020.

P146 English Leadership Resource and External Training
Subsidy

Staff develop good reading habits mainly by the provision of a wide
range of reading activities and a rich collection of library resources.

P146 e-Library

The HTC Employee Welfare Committee provides scholarships for thechildren of employees from elementary school to college.

P150 Education Scholarships for Children

The HTC Education Foundation is committed to the developmentof character education for young people, established the “ManyBlessings Course” for junior and senior high school students.

P179 Many Blessings Courses

We invited professor Yuan-Tseh Lee to give a speech on “global
warming and sustainability in Taiwan“ at our Thinker Forum in 2020.

P145 Thinker Forum- Global warming and Sustainability in
TaiwanThe first 5G MIT mobile phone in the world, HTC U20 5G, supporting
the SA & NSA model.

P018 HTC Chairman Cher Wang Awarded Accenture VR
Lifetime Achievement Award

P015, 020 Industry Overview: Smartphones

Besides original VR content production and publication, HTC VIVE
ORIGINALS also integrates the VR world more extensively in ourlives through the four pillars of major development. They are, content
output, commercial values, platform services, and solutions.

215

HTC launched VIVE Sync VR virtual conferences so users can
SDGs 9 :communicate without difficulties even when they are home during
Industry,
the pandemic.
Innovation,andWe developed the VR theatre management system to provide easier
Infrastructure and more humane management interfaces through systematic

SDGs 13 :ClimateActionP042 VIVE Sync-Online Virtual MeetingP184-185, 189 Social Investment and Contribution: VIVE
ORIGINALS

We introduced the most cutting-edge Volumetric Capture Studio tocarry out cross-disciplinary innovation pipeline developments.

P191 Volumetric Capture Studio

HTC won the Derwent Top 100 Global Innovators in 2020.

P086 Overview of patent performance and outcomes

Tesla superchargers are installed and bicycle parking is provided
in our Taipei offices to encourage our staff to use transportation
vehicles with low contamination and high-energy efficiency.

P078 The Use of Green Energy

HTC smart mobile devices combine new models of operation, life, work, study, and travel involving smart mobile devices
help users save energy 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.
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.

P069 Management of Climate Change Risk

All power supply devices used for HTC products must comply
with the relevant international energy consumption specifications
and the energy efficiency has reached the highest level of Level
VI requirements, and the currently used chargers are lower than
0.075W or 0.03W, which has greatly exceeded the standard
requirements(<0.1W).

P103 Enhancement of Energy Efficiency

HTC launched the VIVE Sync-online virtual reality conference service
to facilitate WFH, resulting in tremendous carbon reduction due toless movement.

P042 VIVE Sync-Online Virtual Meeting

P021, 084 Product Overview: VIVE Cosmos

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 the business machine before printing,effectively reduces the unclaimed printed documents
P099 Photocopying Paper Management

P023 Product Overview: VIVE ORIGINALS

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

VIVELAND Kaohsiung is located at Taroko Park, and is the largest
VR theme park in the country.

P023 Product Overview: VIVELAND

Through the introduction of ERP and various electronic online
approval systems, the process that originally required paper approval
is converted to online approval, which not only simplifies the process
and saves time, but also because many forms or signatures do notneed to be printed by a printer. To save paper and electricity bills.

VIVE Arts is dedicated to the development of the global virtual
reality art and culture arenas, and is in collaboration with museums
and content developers.

P023 Product Overview: VIVE ArtsThe United Nation’s Sustainable Development Goals

Page and Corresponding titles

HTC aims to reduce photocopying paper consumption by 1% peryear and bring the use of paper down to an absolute minimum.

The VIVE Cosmos adjustable module design enables users to easilychange to faceplates with different specs according to content.
VIVE Cosmos series won the “Fast Company Innovation by DesignAwards” from the American heavyweight business magazine, Fast
Company.

Key performances of sustainability development

broadcasting management.

We continue to invest numerous resources to facilitate the development of the industry and to nourish the hardware andplatform ecosystems. Therefore, the entire industry can infuse more innovative content and multiple experiences to help
frame, cultivate, and strengthen the global virtual reality ecosystem. Consequently, we can realize the commitment of getting
virtual reality closer to the consumers, developers and enterprises through innovative technologies and top-quality content.

HTC Chairman Cher Wang awarded the Accenture VR Lifetime
Achievement Award.

SDGs

Tesla superchargers are installed and bicycle parking is provided
in our Taipei offices to encourage our staff to use transportation
vehicles with low contamination and high-energy efficiency.

P078 The Use of Green Energy

HTC 2020 CSR Report216

HTC’s Performance in Response to the UN’s SDGs : Other Objectives
SDGs

SDGs 13 :ClimateActionKey performances of sustainability development

Page and Corresponding titles

SDGs

LED energy-saving lighting is used in the HQ and plants.

P076 2020 Energy Saving and Carbon Reduction Results

WFH in response to the pandemic can reduce traffic carbon
emission.

SDGs 1 :No Poverty

P035 COVID-19 Prevention Management

Promote partnerships that facilitate goal realization. HTC and many core strategic partners have achieved cross-domain
SDGs 17 :Partnerships cooperation to further expand the VIVE ecosystem.
for theGoals
We collaborated with the Economic Development Bureau,
Kaohsiung City Government, and coached teams to successfullylaunch six pieces of work at VIVEPORT Arcade in the fourth quarter.
We collaborated with the New Taipei Municipal New Taipei Industrial
Vocational High School by joining the “Demo Day“ project.

P183 Alliances with schools to establish VR talent incubators

The first frame-by-frame animation with VR technology in the world,“THE SICK ROSE” .

P186 New original IP content: Frame-by-frame animation
with VR technology, The Sick Rose

In collaboration with Japanese contemporary artist, Miwa Komatsu,
to create a VR interactive artwork, “Inori” .

P187-188 In collaboration with Japanese contemporary
artist, Miwa Komatsu, to create a VR interactive artwork,“Inori”

We broadcasted the VR work exhibited at the Venice Film Festival
in Taiwan, and collaborated with the TCCF Taiwan Creative Content
Fest.

P189-190 Social Investment and Contribution: VIVE
ORIGINALS

The Blockchain trading platform system was established to elevatecooperation for cultural content and commercial distribution
channels.

P191 Blockchain trading platform

Worked in collaboration with well-reputed British V&A Museum tocreate the Virtual Reality experience, “Curious Alice” .

P193 London V&A Museum Virtual Reality ExperienceCurious AliceThe first virtual reality work, “Sleepwalking in the Forbidden City,”
was displayed at the Odyssey and Homecoming exhibition coorganized with the Palace Museum in Beijing and the XXIV Olympic
Winter Games.

P194 Cai Guo-Qiang to launch VR fireworks “Sleepwalking
in the Forbidden City”

In collaboration with The Kaohsiung Museum of Fine Arts to curate“The Universe” , by Liu Kuo-Sung through VR technology.

In collaboration with the Grand Palais Salon d'Honneur, Paris, wereconstructed the ancient city of Pompeii through VR technology.

We invited various groups to the charity event at the “HTC Christmas
Event in 2020: Passing Down the Love” on the Christmas Eve of 2020.

P203 HTC Christmas Event in 2020: Passing Down
the Love

In 2020, the children from the HTC Charity School were invited toperform at a small violin concert at HTC.

P202 The Charity Concert

Besides key components, we try to purchase local raw materials andrelated equipment

P126 Sustainable Supplier Chain“Awavena“ won an Emmy Award for Outstanding New Approaches toDocumentary, which witnessed the birth of the first woman shaman in
the Yawanawa community in history with VIVE virtual reality technologies
in the Amazon.

P200 VR for Impact Program

A friendly environment for breastfeeding. We provide a warm andcomfortable nursing environment, ultraviolet milk bottle disinfection
devices, microcomputer thermos, and comfortable sofa, refrigerator forbreast milk storage, and infant breast-feeding-related publications andlight music.
A female free cancer-screening program is part of the annual healthcheck. This includes the choice of a Pap smear, a breast ultrasound exam,
or a mammogram.

P155 Valuing Female Employees

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.

P156 Work-life Balance Support

Set up diversified feedback channels, including setting up grievance lines,
appeal boxes, e-mail address for complaints, and sexual harassment
complaint mailboxes.

P151 Listening to the Voice of the Employee

The green fields and planted areas inside the factories are irrigated withrecycled sewage water without increasing the total amount of water
consumed.

P097 Sewage Recycling

HTC has established a rainwater storage and recycling system to collectrainwater for flushing toilets and watering plants.

P098 Rainwater Storage and Recycling System

P195 The Kaohsiung Museum of Fine Arts, “The Universe”
by Liu Kuo-Sung, in memory of Liu's 70 years in Taiwan

HTC gives top priority to the use of sanitary equipment with a watersaving label. All the toilets and urinals in the bathrooms should beenergy efficient and have the Water Sense Label of the United States
Environmental Protection Agency and Water Label of water resource
agency, MOEA.

P098 Water-saving Sanitation Equipment

P196 Pompeii, the VR experience at Grand Palais Salon
d'Honneur, Paris

The drinking water quality directly affects the health of employees anddrinking water management is closely related to water quality.

P163 Drinking Water Quality Control

P197 Tao Ya-Lun solo exhibition –“Ubiquitous Ghosts”

Kuo Hsueh-Hu's “The Three States of Home Gazing” , created withdigital technology which create a VR experience artwork.

P198 Social Investment and Contribution: VIVE ArtsThe United Nation’s Sustainable Development Goals

Pages and Corresponding Titles

Encourage and support employees to raise the next generation withconfidence, HTC has a perfect application system for parental leave toprotect employees' work rights so that parents can take care of theirnewborns with ease.

VIVE Arts in collaboration with the Museum of Contemporary Art(MOCA) in Taipei to curate the brand-new virtual reality series ofwork byTaiwan new media artist, Tao Ya-Lun's and his solo exhibition,“Ubiquitous Ghosts” .

In the online project of the “Venice Virtual Reality Expansion” at the2020 Venice Film Festival, VIVEPORT organized a series of virtual
reality movies and themes focusing on humanitarian issues.

217

P183 In collaboration with Kaohsiung City Government –MIT Virtual Reality Content

SDGs 5 :GenderEquality

Key Performance of Sustainability Development

P201 VR for Impact Program

SDGs 6 :Clean
Water and
Sanitation

SDGs 7 :Affordable
and Clean
EnergySDGs 8 :DecentWork andEconomic
GrowthThe Taipei Office has solar panels that generate electricity used forlighting the staircases and basement.
Taoyuan plant is going to install the solar power generation system on
the roof. By means of internal line parallel series, the power was sold andconnected to the Taiwan Power Company's power supply system.

P078 The Use of Green Energy

In the National Invention and Creation Award in 2020, HTC employees
won the golden and silver prizes of the creation category.

P086 Overview of patent performance and outcome

To demonstrate our care and respect of labor rights, and our zerotolerance on an abusive laborforce, HTC released the “Modern Slavery
Act Transparency Statement”.

P126 Statement on Uyghur Human Rights Issues in
ASPI Annual Report

HTC strictly prohibits the use of child labor in our own manufacturing
facilities as well as those of our manufacturing suppliers, and we mandate
proof of age for employment.

P135 No Child LaborHTC 2020 CSR Report

218

SDGs

SDGs 8 :DecentWork andEconomic
GrowthSDGs 11 :Sustainable
Cities andCommunities

Key Performance of Sustainability Development
HTC strives to provide a safe and healthy working atmosphere for allof our employees while adhering to sustainability best practices which
protect our environment.

P093 HTC Environment Protection, Occupational
Safety, Health, and Energy Policy

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 and development in
the future.

P148 Sound Wage and Welfare System

In addition to upgrading the professional technical annual training courses
and department professional courses, in conjunction with HTC's policy,organizational learning planning was conducted.

P147 Training Result

VIVE Arts is aggressively dedicated to developing the global virtual
reality art and culture arenas, as well as collaborating with museums andcontent developers.

P192 Other Social Engagement Activities:: VIVE Arts

VIVE Original is in collaboration with the TCCF to promote culture
sustainability.

P190 Collaborating with the TCCF to host the 2020
Taiwan Creative Content Fest

We organized the HTC Gallery in the Taipei offices as the art exhibition
venue that is open to schools and the public in the community, which also
assists local young artists.

P153 A Working Environment Incorporating Brand
SpiritTo ensure the quality of life and comfort of our employees as well asthat of nearby residents, HTC takes measures against dengue fever andcarries out pest and rodent control on a quarterly basis. Standing water
pools near the plant are sprayed to reduce mosquito population density.

P164 Environmental Sanitation Agents

Suppliers must sign the “HTC supplier Code of Conduct”, and be audited
SDGs 12 :Responsible regularly.
Consumption HTC upholds and carries out waste management. We authorize legitimate
contractors to remove the waste with the most appropriate management
andmeasures.
Production
We carry out the classification of waste. Other recyclable resources are
purified and transformed to industrial raw materials by reuse contractors
authorized by the government.

P126 HTC Supplier Code of Conduct

P113 Hazardous Waste Management

P116 Waste Reduction, Recycling and Reuse

P109 Hazardous Substance Management

Factories regularly conduct hazardous substance tests for materials
according to the Hazardous Substance Management Directive, andensure that the tests comply with requirements of RoHS 2.0.

P118 HTC Hazardous Substance Management Policy

HTC chooses materials that are easily recyclable and reusable. Besides
marking the products with recycle labels in the EU market, they are also
verified by third-party companies to ensure they are in accordance withthe 3R recycle rate.

P111 EU WEEE Waste Electrical & Electronic
Equipment

HTC requests that suppliers to provide the latest data related to SVHC,
and encourages them to reduce use of chemical substances.

P111 EU REACH (Registration, Evaluation, andAuthorization of Chemicals)

HTC's AC adapters have been upgraded to the latest ErP standard inaccordance with the regulations of the new directive governing efficiency
requirements for external power supplies.

P112 EU ErP Directive of Eco-design Requirements ofEnergy-using Products

SDGs 15 :Wulai Atayal Wild Honey and other groups are invited to set up stands inLife on Land order to promote wild bee conservation.

SDGs

Key Performance of Sustainability Development

Through the introduction of ERP and various electronic online approval
SDGs 15 :the process that originally required paper approval is convertedLife on Land systems,
to online approval, which not only simplifies the process and saves time,

but also because many forms or signatures do not need to be printed bya printer. To save paper and electricity bills.

We ensure that not only all used parts, modules, and materials are
restricted by the “Restriction of the use of Certain Hazardous Substances
Directives, RoHS”, but also those by international environment protection
regulations and international customers.

Based on the EU RoHS testing foundation, HTC products sold in Europe
and Asia are in accordance with the regulations of RoHS.

219

Pages and Corresponding Titles

P112 EAC RoHS

SDGs 16 :Peace andJustice
Strong
Institutions

P099 Photocopying Paper Management

HTC follow the Responsible Business Alliance Code of Conduct andformulated an “HTC Supplier Code of Conduct”, which aims to protect
the environment with our supply chain partners, safeguard the humanrights of our workers, their ethics, safety and health, and extend this social
responsibility to the supply chain system.

P126 Sustainable Supplier Chain

HTC requires all suppliers to maintain the same standard of corporate
responsibility, and releases the “Modern Slavery Act Transparency
Statement”.

P135 Human Rights and a High Standard ofProfessional Ethics

HTC strictly prohibits the use of child labor in our own manufacturing
facilities as well as those of our manufacturing suppliers. We mandate
proof of age for employment to ensure we meet all local labor laws andthe requirements of the jurisdictions where we operate.

P135 No Child Labor

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.

P135 Structure of HTC's personal information
management system

In addition to “Anti-corruption and Bribery Statement” passed by thechairman 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” andhas revised the “Operational Procedures for Transactions of SpecificCompanies, Business Conglomerates, and Parties”, “Regulations for
Budget Management”, “Regulations for Management of Subsidiaries”,
and “Operational Procedures for Processing Internal Material Information
and Preventing Insider Trading” as bases for internal operations.
In Procedure for Board of Directors Meetings, it has duly set out asystem for recusal and avoidance of conflicts of interest by directors, forcompliance in the operations of the board of directors.
A dedicated reporting channel (anti-corruption@htc.com) has also
been established for employees to expose any improper behavior thatcomes to their attention, and HTC will keep the identity of the reporter
confidential.

P058-059 Strict Mechanisms for Avoiding Conflicts ofInterest

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
HTC has established the “HTC Code of Conduct” as the prime directive
for all employees at work.
HTC puts emphasis on legal education, and add legal training as acompulsory course for new employees. Examples were included in thee-Course for promotion.
Organize regular training courses for R&D personnel to promote thecompany's intellectual property policy to establish a correct intellectual
property concept.
HTC clearly stipulates employees' intellectual property rights in theemployment contract and demands employees to comply with HTC's
intellectual property related regulations.

P203 HTC Christmas Event in 2020: Passing Down
the Love

Set up diversified feedback channels, including setting up grievance lines,
appeal boxes, e-mail address for complaints, and sexual harassment
complaint mailboxes.

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.

P094 Office Environment with Plants and Green
Landscaping

Labor-management meetings and employee opinion surveys are held
regularly as a reference for supervisors, internal operations, improvementof employee satisfaction levels and improvement of work commitments.

In 2013, HTC's Taipei office received the green building mark from
Ministry of the Interior and the golden LEED (Leadership in Energy &Environmental Design) certification from the U.S. Green Building Council(USGBC).

P095 HTC's Taipei office, The Golden LEED Certified
Green Building

HTC conducts employee satisfaction surveys through questionnaire
surveys to directly understand the voices of employees, which can in turnimprove work efficiency and effectiveness, and reduce the turnover rate.

The United Nation’s Sustainable Development Goals

Pages and Corresponding Titles

P085 Protection of IP Rights

P151 Listening to the Voice of the Employee

P159 Employee Satisfaction Survey

HTC 2020 CSR Report220

Assurance Statement

ASSURANCE STATEMENTSCOPE OF ASSURANCE AND REPORTING CRITERIA
The scope of the assurance included evaluation of quality, accuracy and reliability of specified performance
information as detailed below and evaluation of adherence to the following reporting criteria:
Select specific reporting criteria included in the contract

SGS TAIWAN LTD.’S REPORT ON SUSTAINABILITY ACTIVITIES IN THE HTCCORPORATION’S CORPORATE SOCIAL RESPONSIBILITY REPORT FOR 2020
NATURE AND SCOPE OF THE ASSURANCE/VERIFICATIONSGS Taiwan Ltd. (hereinafter referred to as SGS) was commissioned by HTC CORPORATION (hereinafterreferred to as HTC) to conduct an independent assurance of the Corporate Social Responsibility Report for 2020
(hereinafter referred to as the Report). The scope of the assurance, based on the SGS Sustainability Report
Assurance methodology, included the sampled text, and data in accompanying tables, contained in the reportpresented during on-site verification. SGS reserves the right to update the assurance statement from time to timedepending on the level of report content discrepancy of the published version from the agreed standards
requirements.
INTENDED USERS OF THIS ASSURANCE STATEMENT
This Assurance Statement is provided with the intention of informing all HTC’s Stakeholders.
RESPONSIBILITIESThe information in the HTC’s CSR Report of 2020 and its presentation are the responsibility of the directors or
governing body (as applicable) and the management of HTC. SGS has not been involved in the preparation of
any of the material included in the Report
Our responsibility is to express an opinion on the text, data, graphs and statements within the scope of verification
with the intention to inform all HTC’s stakeholders.
ASSURANCE STANDARDS, TYPE AND LEVEL OF ASSURANCEThe SGS ESG & Sustainability Report Assurance protocols used to conduct assurance are based uponinternationally recognized assurance guidance, including the Principles contained within the Global Reporting
Initiative Sustainability Reporting Standards (GRI Standards) 101: Foundation 2016 for report quality, and theguidance on levels of assurance contained within the AA1000 series of standards and guidance for Assurance
Providers.
The assurance of this report has been conducted according to the following Assurance Standards:

Assurance Standard Options

Level of
Assurance

Reporting Criteria Options
1 GRI Standards (Core)
2

AA1000 Accountability Principles (2018)•••

evaluation of content veracity of the sustainability performance information based on the materiality
determination at a high level of scrutiny for HTC and moderate level of scrutiny for applicable aspectboundaries outside of the organization covered by this report;
AA1000 Assurance Standard v3 Type 2 evaluation of the report content and supporting management
systems against the AA1000 Accountability Principles (2018); andevaluation of the report against the requirements of Global Reporting Initiative Sustainability ReportingStandards (100, 200, 300 and 400 series) claimed in the GRI content index as material and inaccordance with.

ASSURANCE METHODOLOGY
The assurance comprised a combination of pre-assurance research, interviews with relevant employees,
superintendents, CSR committee members and the senior management in Taiwan; documentation and record
review and validation with external bodies and/or stakeholders where relevant.
LIMITATIONS AND MITIGATION
Financial data drawn directly from independently audited financial accounts and Task Force on Climate-related
Financial Disclosures (TCFD) has not been checked back to source as part of this assurance process.
STATEMENT OF INDEPENDENCE AND COMPETENCEThe SGS Group of companies is the world leader in inspection, testing and verification, operating in more than
140 countries and providing services including management systems and service certification; quality,
environmental, social and ethical auditing and training; environmental, social and sustainability report assurance.
SGS affirm our independence from HTC, being free from bias and conflicts of interest with the organisation, its
subsidiaries and stakeholders.
The assurance team was assembled based on their knowledge, experience and qualifications for this assignment,
and comprised auditors registered with ISO 26000, ISO 20121, ISO 50001, SA8000, RBA, QMS, EMS, SMS,
GPMS, CFP, WFP, GHG Verification and GHG Validation Lead Auditors and experience on the SRA Assurance
service provisions.

A

SGS ESG & SRA Assurance Protocols (based on GRI Principles
and guidance in AA1000)

n/a

VERIFICATION/ ASSURANCE OPINION
On the basis of the methodology described and the verification work performed, we are satisfied that the specified
performance information included in the scope of assurance is accurate, reliable, has been fairly stated and has
been prepared, in all material respects, in accordance with the reporting criteria.

B

AA1000ASv3 Type 2(AA1000AP Evaluation plus evaluation of Specified Performance
Information)High

We believe that the organisation has chosen an appropriate level of assurance for this stage in their reporting.

Assurance has been conducted at a high level of scrutiny.

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AA1000 ACCOUNTABILITY PRINCIPLES (2018) CONCLUSIONS, FINDINGS AND RECOMMENDATIONS
Inclusivity
HTC has demonstrated commitment to stakeholder inclusivity and stakeholder engagement. A variety ofengagement efforts such as survey and communication to investors, customers, consumers, employees,
suppliers, and communities are implemented to underpin the organization's understanding of stakeholder
concerns.
Materiality
HTC has established processes for determining issues that are material to the business. Formal review has
identified stakeholders and those issues that are material to each group and the report addresses these at an
appropriate level to reflect their importance and priority to these stakeholders.
ResponsivenessThe report includes coverage given to stakeholder engagement and channels for stakeholder feedback.
Impact
HTC has included in this report the disclosures of the organisation’s impacts on stakeholders and on theorganization itself. Measurements and evaluations on potential impacts, such as direct and indirect, intended
and unintended, and positive and negative impacts and the relevant management process to address these
impacts are to be further described in future report.
GLOBAL REPORTING INITIATIVE REPORTING STANDARDS CONCLUSIONS, FINDINGS AND
RECOMMENDATIONS
The report, HTC’s CSR Report of 2020, is adequately in line with the GRI Standards in accordance with Core
Option. The material topics and their boundaries within and outside of the organization are properly defined inaccordance with GRI’s Reporting Principles for Defining Report Content. Disclosures of identified material topics
and boundaries, and stakeholder engagement, GRI 102-40 to GRI 102-47, are correctly located in content index
and report. For future reporting, it is recommended to have more descriptions of HTC’s involvement with theimpacts for each material topic (103-1). Elements of management approach (103-2) for each material topics,
such as goals and targets, are suggested to be reported in more details in future reports.

Signed:For and on behalf of SGS Taiwan Ltd.

David Huang
Senior Director
Taipei, Taiwan
9 June, 2021
WWW.SGS.COM

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