SSE ：601231

20 
21 

ESG Report

Cover Story
Transforming the Future, Leading towards Sustainability
USI's vision is to become the most reliable Electronic Design and Manufacturing company in the world
As part of our social responsibility and obligations, we are committed to sustainable environmental,social, and governance development
The dots form a rotating spiral that symbolizes the continuous transformation of dreams into reality
Our dedication and attention to detail enable us to keep transforming and achieve sustainable development
The blue and green color scheme represents our Low Carbon and Circular Sustainability Strategy andaccentuates our respect for nature and resources
We will continue our journey with a steadfast pace and realize a sustainable future

TABLE OF
CONTENTS

3

11

Operations andGovernance

13

Company Profile

15

Financial Performance and Tax
Governance

16

Board Governance

4 About this Report

18

Business Ethics and Compliance 60

19Enterprise Risk Management

5 Letter from the Chairman

23

Cybersecurity Management

6 Letter from the President

24

7 USI Contributions to
the SDGs

Sustainability
Management

62 Environmental Protection
and Occupational Safety

25

Sustainability Committee

64

Climate Change and Carbon Management

26

Sustainability Policy

71

9 Awards and Recognition

26

Sustainability Strategy

31
32

46

Value Chain Management

111 Social Involvement

48

Product Value Chain

113

Social Activities Overview

49

Customer Service and Satisfaction

115

Investing in Education

51

Customer Privacy and Product Safety

117

Contributing to Society

53

Supply Chain Management

119

Conserving the Environment

Conflict Minerals Compliance

121

Promoting Arts and Culture

122

External Participation

123 Appendix
123

Management Systems
Certification Table

Water Resource Management124

ESG Key Performance Data

72

Waste Management

132

Sustainability Data - Environmental

Sustainable Impact Assessment

74

Air Pollution Control

136

Sustainability Data - Social

Stakeholder Engagement

75

Green Manufacturing and Expenditures

142

Sustainability Data - Governance77

Occupational Health and Safety

143

Third-Party Assurance Statement

145

GRI & CASS-CSR 4.0 Index

158

SASB Index

158

USI Specific Disclosures andAdditional Indicators

38 Green Products
and Innovation

87 Inclusive Workplace89

Human Rights Protection

40

Research Patents andContinuous Improvement

94

Talent Attraction and Retention

161

Manufacturing Sites

43

Green Product Management

106

Human Capital Development

162

Sales OfficesAbout this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

About this Report
Universal Scientific Industrial (Shanghai) Co., Ltd. (USI, Company, We) issues an annual ESG Report to publicly disclose our measures, achievements, and targets for all ESG key issues. This reportis the tenth ESG Report published by USI and its subsidiaries. (From 2010 to 2012, USI's indirect controlling shareholder Universal Scientific Industrial Co., Ltd. published three ESG Reports).
Stakeholders could learn about our sustainability achievements through this report and join us in our ESG journey.

Principles for
ReportCompilation

This report has been prepared in accordance with GRI Standards (2016) Core option and CASS-CSR 4.0
basic framework. This year, we also integrated the SASB Electronic Manufacturing Services & Original
Design Manufacturing Standards into our reporting for the first time. We also use other recognizedframeworks such as the Evaluation Index System of Shanghai Listed Corporate Social Responsibility
Index (2017) and the Shanghai Stock Exchange Environmental and Social Responsibility Disclosure
Requirements to provide ESG information. Please refer to the Stakeholder Engagement section formaterial topics and report boundaries.

Since 2013, USI has published an ESG Report in
Traditional / Simplified Chinese and English every July andis accessible on the USI Sustainability Web (https: // www.
usiglobal.com /csr).

Report Publication
Previous
Version

Report Scope
andBoundaries

External
Assurance

The data collection period of this report was from 01 / 01 / 2021 to 12 / 31 / 2021, and financial data
are expressed in CNY throughout the report. Environmental, health, and safety data are describedusing accepted international standard units and indicators. The report scope includes Zhangjiang
Facility, Jinqiao Facility, Shenzhen Facility, Kunshan Facility, Nantou Facility (Nantou-TT and
Nantou-NK), and Mexico Facility. If data numbers have a data scope different from the defined
scope above, there will be a note indicating the particular scope for that data.
ASE Technology Holding Co., Ltd. is the parent company of USI and is referred to as our "parent
company" or "ASEH" in this report.

Every year, we complete a third-party verification for this report to improve information transparency
and accountability. SGS Taiwan Ltd. provided third-party assurance for this report following AA1000
AS v3 (2020) Type 2 Moderate Level with GRI 45 disclosures verified with High Level. This year we
also verified 7 SASB Electronic Manufacturing Services & Original Design Manufacturing disclosure
topics. For details, please refer to the GRI & CASS-CSR 4.0 Index and SASB Index.

Released in July
2021

Current
VersionReleased in July
2022

Next
VersionPlanned releasein July 2023

If you have any suggestions,please contact us at:• Address: No.1558 Zhang Dong Rd., Pudong New Area,
Shanghai 201203
Tel• : +86-21-5896-6996• Email : csr@usiglobal.com• Web: https://www.usiglobal.com• Address: No.141, Lane 351, Sec. 1, Taiping Road,
Tsaotuen, Nantou County 542007• Tel : +886-49-235-0876

4

About this Report

Operation and
Governance

Letter fromthe Chairman

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

In the past year, the world has yet to shake off the volatility brought
about by the COVID-19 pandemic while facing increasingly severe
natural disasters caused by extreme weather. As people face thethreat of environmental problems, governments have put forward
countermeasures to show their determination to protect theenvironment. Mainland China has committed to reducing carbon
emissions to achieve 2030 Peak Carbon Emissions and 2060 Carbon
Neutral goals, with specific policies and implementation standards
to be released. Therefore, environmental protection (E), social
responsibility (S), and corporate governance (G) are not only thecriteria for investment decisions but have also become key tosustainable business operations.
ESG is an essential part of USI's business operations. We constantly
enhance our practices to go above and beyond regulators'
requirements. In recognition of our efforts in sustainability, we wereinvited to participate in the 2021 S&P Global Corporate Sustainability
Assessment for the first time and received S&P Global Bronze Class
distinction in the Electronic Equipment, Instrument, and Component
industry group. Not only have we maintained a BB Rating in MSCIEmerging Markets Index, but we also continued to be included in the
SSE Corporate Governance Index and maintained our SSE information
disclosure A rating for four consecutive years.
We are committed to sustainable development and are determined
to become the world's most reliable Electronics Design and
Manufacturing company. Following our Sustainability Strategy's
four dimensions, Low Carbon, Circular, Collaborative, and Inclusive,
we drive our sustainability initiatives through our Sustainability
Committee. Through the Committee, we strive to create a safe
working environment, build sustainable partnerships with our
stakeholders to accelerate our value chain's growth, and promotesocial development through cooperation and innovation.

5

Inclusive
WorkplaceSocialInvolvement

Appendix

USI pays close attention to environmental initiatives in the places
we are located. After understanding the policies, we develop
environmental protection and carbon reduction strategies in response.
To achieve our Science-Based Target (SBT) by 2030, we formed our
Net-Zero Carbon Emissions Strategy based on leveraging renewableenergy. We have been purchasing renewable energy certificates since
2018, and in 2021, our renewable energy consumption reached 80.3%
at the cost of approximately CNY 3.39 million, accounting for 0.006%
of our revenue. Our net carbon emissions are on-track and alreadybelow our SBT target.
In 2021, USI overcame various operational challenges and reached arecord high revenue of CNY 55.3 billion, achieving a record revenue
growth of 15.94%. As an A-share listed company in Mainland China,
USI has taken the initiative to disclose ESG-related information andhas issued CSR reports for 13 consecutive years. In 2021, we renamed
the report as USI ESG Report to reflect the importance of ESG in ouroperations.
By disclosing information, we hope to establish transparent and open
communication channels with the outside world. With this report,
we also strengthen internal communication on corporate values,
improve various management policies to enhance our sustainablevalue, and contribute to the long-term coexistence and co-prosperity
with our planet. Let's work and move forward together on the road tosustainable development!

Chairman Jeffrey Chen

About this Report

Operation and
Governance

Letter fromthe President

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

In 2021, the COVID-19 virus continued to mutate, the global
pandemic became even more severe, and human travel continued tobe heavily restricted in many ways, resulting in logistics disruptions,shortages of labor and materials, imbalances in market supply
and demand, and inflation. At the same time, the unending tradewars, political turmoil in some countries, and the carbon reductionand 2050 net-zero emissions targets set by countries in response
to global climate change are among the many challenges that are
sweeping the industry, making us all the more aware of the urgencyof implementing sustainable strategies.
In these uncertain times, USI has been strictly self-disciplined andinitiated emergency response strategies to mitigate impact, and has
made concerted efforts to set a new record of CNY 55.3 billion inrevenue and 15.94% year-on-year growth in 2021. In terms of the
global deployment strategy, Vietnam Facility as the first production
base of USI in Southeast Asia, was officially put into productionin July 2021, which also demonstrates the Company's ability toserve overseas customers' orders more flexibly and promote thedevelopment of the local economy and high-tech industries.
In recent years, value chain management has become a top priority
in the technology industry. In November 2021, USI held a Greater
China Global Sustainable Supply Chain Webinar to promote theCompany's policies and corporate philosophy and communicate
directly with suppliers around the world. The content included thecontinuous promotion of a green supply chain, in line with the trendof international environmental protection requirements, and included
the sharing of the requirements, implementation experience, andfuture goals of ESG for suppliers. 276 supplier representatives
attended the meeting, and after the meeting, we received more thanhalf of the questionnaires distributed that gave us a feedback of "verysatisfied". Being awarded the 2021 Lenovo Lean Management Awardby our customers is a solid recognition of our achievements in driving
value co-creation.
In order to reduce the negative impact on the environment in ouroperations, USI has been actively promoting the use of renewable

Inclusive
WorkplaceSocialInvolvement

Appendixenergy since 2018, with 100% renewable energy being used in our
Mainland China Facilities and 31% renewable energy being used in
our Mexico Facility. The solar power system built at the Nantou-NK
Facility generated a total of approximately 1,508 MWh of renewableenergy electricity by the end of 2021. On the other hand, since2013, the Company has been participating in the Million Tree Projectof Shanghai Roots and Shoots Youth Activity Center to promotereforestation and environmental education.
USI's efforts to promote sustainable development have beenrecognized with several awards: The Company was invited for the firsttime to participate in the 2021 S&P Global Corporate Sustainability
Assessment and won the Bronze Award in the Electronic Equipment,
Instrument, and Component industry group. The Company alsoachieved the first place in the electronics industry in Sina Finance's
2021 China ESG Top 500 Excellent Enterprises and the China
Corporate ESG Golden Award Corporate Social Responsibility Award.
In 2021, the Company also achieved a social contribution value pershare of CNY 2.89 (1).
Through the Sustainability Committee's five Taskforces Corporate Governance, Green Products and Innovation, Value
Chain Management, Employee Care and Social Engagement, andEnvironmental Protection and Occupational Safety, USI continues toutilize corporate resources and invest in social services to contributeto the long-term development of Earth. No one is an outsider whenit comes to ESG compliance. We must work together to reduceenergy consumption and protect the natural environment, improve
the working environment and promote diverse talents, proactively
disclose information, achieve fair and transparent management, andstrive for sustainable development.

President C.Y. Wei

Note 1. Social contribution value per share = (earnings per share + tax payments + employee salaries + interest expenses + total social input) ÷ total number of shares issued in the year

6

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

USI Contributions to the SDGs●●

Invested in 5 rural
revitalization programs,
benefiting 1,050
students.

Supplied free COVID-19 nucleic acid testing and rapid testing for
employees, with 9,176 participants.
● Promoted COVID-19 vaccination, with a complete vaccination rate ofover 83%.
● Held 42 health activities, such as occupational health promotion,
blood donation, weight loss competition, and bone density testing,with 13,028 participants.
● Provide medical and emergency support for unexpected or sudden
illnesses for employees on business trips or stationed overseas.

●Employees have the rightto equal pay for equal work
regardless of gender.
● Increased percentage of females
in senior management positionsfor 4 consecutive years, andpromoted 4.7% compared with
2020.






●

7

Donated Care Packages
with rice, oil, and dried
goods to 18 Kunshan
households in need
before Chinese New
Year.

●

Purchased certified renewableenergy to offset carbon
dioxide emissions generated
by traditional electricity used.
100% renewable energy use in
Mainland China Facilities and
31% in Mexico Facility.
● Saved 1,944 MWh of electricity
with energy-saving measures in
2021.

Installed solar panels on the roofof Nantou-NK Facility to promotesolar power and generated 1,508
MWh of green electricity in 2021.
● Encourage innovation andincreased R&D employees to 2,332.








●

●

Donated a cumulative total of 725 boxes of books to
the Philanthropic Libraries.
● Built 5 computer classrooms through the Rural Digital
Education Program, benefiting 1,614 students.
● Trained a cumulative total of 867 USIU internal
lecturers.
● Supported 133 employees to take advanced studies.
● 411 employees are enrolled in 14 On-Job Degree
Programs held in partnership with local schools.

●

36.4% Reduction ofwater use intensityfrom the baseline
year 2015.
● 73.1% Recycling rateof process water in
2021.


●

15.94% Revenue growth in 2021 compared to 2020.
Actively engaged in sound tax policies and honest tax
contributions to support the government's efforts to promoteeconomic growth.
● 84% Satisfaction rate from our major customers.
● Starting salaries for direct laborers at each facility are higher
than local minimum wages.
● Provided 17,923 job opportunities worldwide with 97% local
employment.
●About this Report

Operation and
Governance●

Sustainability
Management

Tightened the banned
substance elimination
program and limited
3 substances (Indium
Phosphide, Nickel Sulfate,
Nickel Amino Sulfate) to
1,000 ppm or less to reduce
harm to workers and theenvironment.

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety●

Promoted green product design, reduced energy loss, and engaged
in continuous improvement to reduce CO2 emissions, saving 95,754
MWh of electricity in 2021, equivalent to reducing 46,888 metrictonnes of CO2.
● 0 days of production interruptions due to climate-related disasters.
(1)● Implemented TCFD
to analyze USI climate risks. Results include
3 opportunities, 3 transition risks, and 3 physical risks. We will use
100% renewable energy in our operations by 2035 and achieve
net-zero carbon emissions by 2050.
● 85 employees volunteered in environmental conservation-related
activities.

●

Supported the Million
Tree Project for 9
years running, planting
a total of 107,833
trees covering 76.71
hectares.

Inclusive
WorkplaceSocialInvolvement

Appendix●

Provide a wide range of electronic products andservices under Global Demand, Local Service to
our customers with operations covering Asia,
Europe, America, and Africa.
● Local purchasing rate reached 39%.
● 100% of our key suppliers meet conflict-freemineral requirements.






●

Employed 83 people withdisabilities.
● Appointed 8 ethnic
minorities to management
positions.

●

Performed corporate risk management assessment andimplemented relevant countermeasures.
● Established an email protection mechanism to strengthen USI
email security.
(2)● Introduced an APT
system to strengthen cybersecurity
protection capabilities.
● Co-worked with suppliers to recycle pallets and packaging
materials, saving approximately CNY 12.45 million.

●

Cleaned up 2 coasts
and picked 335.2 kgof trash.

●

Established Sunshine Conduct Policies and Anti-Corruption Management
Measures with reporting mechanisms to ensure compliance from suppliersand employees. No corruption or bribery instances were found.
● No major fines or violations related to anti-competitive practices or antitrust
laws and regulations.
Note 1. TCFD, Task Force on Climate-related Financial Disclosures
2. APT, Advanced Persistent Threat8About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Awards and Recognition
Maintained Four Years
Information Disclosure
A Rating on Shanghai Stock
Exchange 2018-2021

AwardedS&P Global Bronze Class in
Sustainability Yearbook 2022

2021
AWARDS

AwardedTop 10 Exemplars of Pudong
Headquarters Economy

AwardedSina Finance2021 China ESG Top 500 #1 inElectronics Industry &China ESG Golden Awards 2021 Best Social Responsibility Award

9

ReceivedAwardedWind ESG AAA Rating Top Rated in Electronic Equipment,
Instruments & Components
Industry Group

2021 Lenovo Supplier
Lean Supply Chain
Management Award

AppendixAbout this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

GovernanceZhangjiang Facility

Environmental Protection
and Occupational Safety

SocialZhangjiang FacilitythInclusive
WorkplaceSocialInvolvement

Environmental
Zhangjiang Facility

2020 Outstanding Contributions to Pudong Economy
15th China Listed Companies Value Award - Top 100 Valued
Mainboard Listed Company
10th in Shanghai Top 100 Manufacturing Enterprises 2021
37th in Shanghai Top 100 Enterprises 2021
6th in Shanghai Top 100 Emerging Industry Enterprises 2021
39th in Top 50 of Shanghai Top 100 Growing Enterprises 2021

11 China Charity Festival - 2021 Social Responsibility
Pioneer Award
15th China Listed Companies Value Award - 2021 China Listed
Companies Social Responsibility Award
GoldenBee Excellent CSR Report 2021 - Foreign-Invested andHong Kong, Macau, and Taiwan-Invested Enterprise

Shanghai Roots & Shoots - 2021 Million Tree ProjectSponsorship Award

Shenzhen Facility

Shenzhen Facility

2020-2021 Shenzhen Excellent Foreign Enterprise Harmonious Labor Relations Promotion Award

Kunshan Facility
Jiangsu Green Factory Certification

Shenzhen Advanced Manufacturing Pioneer Award
2020 Shenzhen Excellent Foreign Enterprise - Double
Excellence Enterprise2020 Excellent Import and Export Enterprises
2020 Shenzhen Top 500 Enterprises
2020 Shenzhen Top 100 Industry Leaders
2021 Sugon - Perfect Quality Award
Kunshan Facility
Qiandeng Digital Economy Key Enterprises
2021 Jiangsu Industrial Internet Development Model Enterprise2015-2020 Innovative Transformation and High-Quality
Development of Advanced Enterprises
2020 Qiandeng Outstanding Talent Contributing Tech
Innovation Enterprise
Nantou Facility

AppendixShenzhen Facility
2021-2023 Shenzhen Nanshan District Green Channel
Enterprise

Kunshan Facility
2020 Kunshan A Grade Trustworthy Labor Security Enterprise2020 Suzhou Harmonious Labor Relations Enterprise
Nantou Facility
2018-2022 Accredited Nantou County Nursing Room - Most
Comfortable Room2019-2021 Accredited Healthy Workplace - Health Advocate
Badge
2021 Occupational Health Promotion Outstanding Service
Award
Mexico Facility
Jalisco Distinction for Good Labor Practices

Authorized Economic Operator Certification

10

About this Report

Sustainability
Management

Operation and
GovernanceGreen Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Operations and Governance
USI's vision is to be the most reliable provider for electronic design, manufacturing service, and modularization with diversified global footprints and miniaturization solutions.
Through the collective contribution of employer and employees, we established effective governance mechanisms with respective responsibilities and accountabilities. We strive togenerate exceptional rewards for stakeholders and to build a better place to live.

CNY
CNY

55.3
1.86

A-levelBillion Record High Sales Revenue
Billion Net Profit

Rating of Information Disclosure in the SSE

Included in

MSCI Emerging Markets Index

Included in

SSE Corporate Governance Index

Top 10 Exemplars of Pudong
Headquarters Economy
Listed as

11About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Key Performance and Targets
SDGs

Business Action
Improve economic growthand productivity throughsustainable development

1. Apply sustainable systemor strategy and include
sustainable informationin routine report
2. Ensure all employees
can acquire the related
information andconsensus of sustainable
development

Forbid any kind of
corruption and bribery

Inclusive
WorkplaceSocialInvolvement

Achieved

2021 Key Issue

KPI

2021 Target

2021 Performance

Corporate
GovernanceIncluded in
SSE Corporate
GovernanceIndex

Continue tobe included in
SSE Corporate
GovernanceIndex

Business
Continuity

Obtain ISO 22301
certification

Cybersecurity
Management

Business
EthicsStatusAppendix

Not Achieved

2022 Target

2026 Target

Included in
SSE Corporate
Governance Index

Continue tobe included in
SSE Corporate
Governance Index

Continue tobe included in
SSE Corporate
GovernanceIndex

Obtain ISO 22301
certification in
Nantou Facility

The certification
was postponed due
to COVID-19

Obtain ISO 22301
certification in
Nantou Facility

Implemented
BCMS to major
Facilities

USI Cybersecurity
training
completion rate

80% completion
rate of USI
Cybersecurity
training

85% completion
rate of USI
Cybersecurity
training

100% completion
rate of USI
Cybersecurity
training

100% completion
rate of USI
Cybersecurity
training

USI Employee
Code of
Conduct training
completion rate

100% completion
rate of USI
Employee Codeof Conduct
training

100% completion
rate of USI
Employee Code of
Conduct training

100% completion
rate of USI
Employee Code of
Conduct training

100% completion
rate of USI
Employee Code of
Conduct training

12About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

AppendixCompany Profile
Company Overview
USI (SSE: 601231) is a member of ASEH (TWSE: 3711, NYSE: ASX) and an industry
leader in SiP (System in Package) modules. We provide D(MS)2 product services:
Design, Manufacturing, Miniaturization, industrial software and hardware Solutions,and material procurement, logistics and maintenance Services for brand owners. USI
has a total of 27 manufacturing facilities with company headquarters in Pudong New
Area of Shanghai, China and over 220 SMT lines across Asia, Europe, America, andAfrica to support customers diversified electronic products through "global reach at
a local level" strategy.

Company Name
Registered Capital

CNY 2,209,609,072

Stock Number / Name

601231 / USI Shanghai in SSE

Date of Stock Issue

Feb. 20, 2012

Main Products and Services

Provide professional services in design, miniaturization,material procurement, manufacturing, logistics,
and maintenance of electronic products such ascommunication products, computer and storage products,
consumer electronics, industrial products, medical andautomotive products

Chairman and Chief Executive Officer

Jeffrey Chen

President and Chief Operation Officer

C.Y. Wei

Global Total of Employees

24,768 (As of 12 / 31 / 2021)

Area of Manufacturing Facilities (1)452,146 Square meters (45.2146 Hectares)

Note 1. The area of manufacturing facilities only includes facilities in the scope of this report. For more details, please refer to USI website (https: // www.usiglobal.com / en / global-locations)

13

Universal Scientific Industrial (Shanghai) Co., Ltd.

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Global Operations (1)United Kingdom(1)Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

AppendixGermany(4)Poland(1)Czech Republic(1)France(7)Tunisia(1)Mainland China(6)USA Silicon Valley(1)Mexico(2)Taiwan(2)Vietnam(1)

USI Manufacturing Locations (USI + AFG)

Note 1. For more details, please refer to USI website (https: // www.usiglobal.com) or corporate videos (https: // www.usiglobal.com / en / videos)14About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
Workplace

Financial Performance and Tax Governance
47.70

37.20
33.55
29.71

2017

2018

2019

2020

2021

Operating Revenue (in CNY billion)

Item

2020

2019

Operating Revenue

55,299,654,770

47,696,228,223

37,204,188,424

Operating Profit

2,131,813,481

1,961,650,751

1,422,151,443

Operating Cost

49,981,479,198

42,710,970,316

33,499,411,113

Total Profit

2,138,858,923

1,973,563,055

1,432,762,959

Net Profit

1,856,693,042

1,733,565,232

1,260,107,633

Taxes (1)618,989,548

397,576,824

352,271,710

0.85

0.80

0.58

50,678,107

76,779,477

52,011,789

Government Subsidies

Note 1. 2019 and 2020 data scope were adjusted by Financial Department

15

Unit: CNY

2021

Earnings Per ShareAppendix

55.30

Financial Performance
The global supply chain was highly impacted by COVID-19,
which increased uncertainty of business management.
However, USI achieved superior business performance andhit new high by steady operation strategies. In 2021, USI
reported consolidated sales revenue of CNY 55.30 billion withan increase of 15.94% comparing with 2020. Its total asset isdivided into liabilities and equity, which are CNY 22.77 billion
and CNY 13.08 billion. The earnings per share were CNY 0.85
and dividend remittance was CNY 1,099,138,448, accountingfor 1.99% of revenue. The data scope in this chapter includes
USI global operation locations, please refer to 2021 USI Annual
Report for more financial information.

SocialInvolvement

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Board GovernanceTax Governance
USI established tax policy to organize tax governance and follow tax laws of global operation
locations, we believe that being an honest and responsible taxpayer fosters economic growthand contributes to long term business sustainability. The Chief Financial Officer supervises tax
policy compliance, financial staff must take taxation training courses to prevent any risks fromuncertain tax regulations.

Board Structure
General Meeting of Shareholders

Nomination Committee
Board of Supervisors

Board of Directors

President Office

General Manager

Compensation Committee

Tax Policy
1. Comply with all applicable tax laws and regulations of all countries in which we operateand duly reporting and paying all necessary taxes in a timely manner.
2. Take both short term and long-term tax impacts into consideration when making major
business decisions.
3. Be transparent and disclose tax information in accordance with applicable regulations
and reporting requirements.
4. Pay taxes on the profits earned from business activities conducted in relevant
jurisdictions and ensure intra-group transactions are conducted at arm's length.
5. Don't use tax havens and tax structures that are meant for tax avoidance or aggressive
tax planning.
6. Construct an appropriate mechanism to evaluate potential tax risks which are given rise
to our global manufacturing and sales activities.
7. Develop mutually trustful and respectful relationships with tax authorities in the
countries we operate and communicating with them on tax matters where appropriate.
Our principal operating facilities and offices are in Mainland China and Taiwan. Therefore, a large
proportion of operating revenue and profit before income tax is accounted by business activities
conducted in Mainland China and Taiwan, which contributed more than 70% of income tax
expense and income tax paid. The statutory tax rates in Mainland China and Taiwan are 25% and
20% respectively. Mainland China Facilities qualified as high-technology enterprises, and thus
were entitled to a reduced income tax rate of 15% and were eligible for weighted deduction ofresearch and development expenses. Additionally, Nantou Facility was also qualified as industrial
innovation enterprise and thus entitled to reduce research and development before income tax.
The effective tax rates in Mainland China and Taiwan were 9% and 21% respectively in 2021.
Note 1. Tien-Szu Chen resigned from the 5th Board of Directors, Gilles Baruk Benhamou was approved to fill the board vacancy

Strategy Committee

Manufacturing Sites

Business Units

Audit Committee

Function Units

Audit Center

Board of Directors
The USI's Board of Directors candidates are nominated by the Nominating Committee andthen approved by the Board of Directors and the Shareholders' Meeting. Currently, USI's
Board of Directors is composed of 9 directors, with three independent directors. Each Board
Director's term is three years. Jeffrey Chen serves as Chairman of the Board. The responsibilities
of Chairman are to supervise the execution progress of Board resolutions and exercise theauthorities of legal representative. Board of Directors shall exercise its authorities according tolaws, administrative regulations, department rules or articles of the company. Material events
must be deliberated and voted by directors after full discussion. But if the events are out of
the authorization to Board of Directors, it should be submitted to Shareholders' meeting fordeliberation and approval. The Company holds at least two board meetings every year. There
were 7 board meetings in 2021 with a 100% attendance rate.
Shareholders can nominate directors and independent directors. The Nominating Committee will
select candidates based on their professional background and working experience. Independent
director candidates are required for the attitude of independence. Company held annual
shareholders' meeting in April 2021. In addition to reviewing 2020 directors and supervisors'working reports and financial related issues during the meeting, a proposal of by-electing thenon-executive director was approved (1). For further details and the complete list of the Board of
Directors, please refer to Section 4 of 2021 USI Annual Report.

16

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Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Inclusive
WorkplaceSocialInvolvement

Appendix

Board Diversity

Board Performance and Compensation

USI considers diverse factors such as: age, professional background, industry experience andnationality for board composition. The directors are assigned to different committees according
to their expertise to enhance corporate core competitiveness, increase the efficiency and qualityof major investment decisions, as well as perfect the corporate governance structure. Pleaserefer to USI Investor Relations website (https://www.usiglobal.com/en/corporate-governance/irboard) for the Board of Directors backgrounds.

USI established an evaluation and incentive mechanism to measure the performance of
directors, supervisors, and senior officers respectively. Compensation Committee will draft acompensation proposal according to achievement rate of annual profit and operating targets.
The proposal is generated after considering about industrial salary level and company status,
and interlinking the business operator's annual salary, company asset, profitability, and businessgoals. It is expected to enhance operator's positivity, perfect the mechanism to select thesuperiors and strengthen goal constraint. For further details of Compensation of Directors,
Supervisors and Senior Officers, please refer to Section 4 of 2021 USI Annual Report.

Continuous Education for Board Members
To expand board members' competencies, USI arranges training courses that cover corporate
governance and sustainability for board members in hopes that they will incorporate the spiritof sustainability in steering USI corporate policy. In 2021, board members completed 19 hours of
training.

Course NameHour(s)2021 Training Course for Corporate Governance

17

Regulatory Working Meeting of Listed Companies

2

Total Training Hours

19

Board Participation in Sustainability GovernanceThree USI Board Members, namely, USI President C.Y. Wei, USI Chairman Jeffrey Chen, and
ASEH Chief Administration Officer Dtuang Wang, have roles in our sustainable governance.
USI President C.Y. Wei acts as the Chair of Sustainability Committee, and the other two board
members are members in the ASEH Corporate Sustainability Committee. Their participationin the Sustainability Committee can strengthen the relationship between the Board andsustainability strategies. Each year, the Sustainability Committee submits the annual ESG Reportto the board of directors, and a series of discussions and plans will be carried out by the boardof directors regarding our implementation of Corporate Social Responsibility activities. VP Otto
Yu, the Taskforce Leader of Environmental Protection and Occupational Safety, shared theglobal trend of carbon reduction and USI Net Zero strategies in board meeting in July 2021. That
will help the environmental sustainability to be more implemented by corporate governancedecisions.

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Environmental Protection
and Occupational Safety

Conflict of Interests Management
According to the Company Articles, any corporations related to the matters in the resolutions
made in the director meetings and board meetings shall not vote on such resolution or
exercise the right to vote on behalf of other directors. And company has Board of Supervisors
which includes the representatives of the shareholders and representatives of the employees.
Supervisors shall monitor the acts of the directors and senior officers, audit and approve theregular reports prepared by the Board of Directors. External auditor will issue an internal
audit report annually. USI held 2 Shareholders' meetings in 2021; shareholder representatives
passed resolutions of Directors and Supervisors and financial proposals in accordance with thelaws. Please refer to USI Investor Relations website (https://www.usiglobal.com/en/corporategovernance/ir-board-supervisors) for the name list of Board of Supervisors.
To safeguard investor interests, USI has a dedicated unit to address investors' concerns anddeveloped corporate Investor Relations Management Guidelines to build a good communication
platform for direct engagement. USI is committed to providing transparency about the status ofour business operations and monthly updates on our Investors Relations website. Also, we retain
legal counsel to provide necessary services and maintain a long-term, stable, and harmonious
relationship between the corporation and investors.

Board Committees
USI's Board of Directors has four special committees: Strategy Committee, Nominating
Committee, Compensation Committee, and Audit Committee. There are rules of procedure forthe committees. Each special committee reports to the Board of Directors, and the proposals of
the special committees shall be examined and determined by the Board of Directors.

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Management

Green Products
and Innovation

Value Chain
Management

The members of those committees shall all be directors. The number of independent directors
in the Audit Committee, Nominating Committee, and Compensation Committee shall be in
the majority, and the independent directors shall be the conveners of those committees. The
convener of the Audit Committee shall be a professional accountant. The members of theStrategy Committee shall include at least one independent director. Please refer to USI Investor
Relations website (https://www.usiglobal.com/en/corporate-governance/ir-committees) for thecomposition of special committees.

Audit Center
Audit Center is subordinate to the audit committee under the board of directors. The employmentof the head of auditing must be approved by half of the board members. A full-time head auditor
is established, and auditors are established in major facilities as well.

Board Meeting
Audit Committee

Environmental Protection
and Occupational Safety

China Team 1

SocialInvolvement

AppendixBusiness Ethics and ComplianceBusiness Ethics
USI adopts a zero-tolerance attitude with the violations of fraud behaviors. To make sureemployees do not have fraud or illegal profit exchanges with related institutes, USI employees
must put more emphasis on incorruptible deeds. In employees' working regulations, they
are required not to engage in activities for personal gain with their authority. USI has drawn
up a Code of Business Conduct and Ethics (1) and a Privacy Policy (2) to be the business dealing
standards of company employees, business partners and other stakeholders.

Grievance Mechanism and Whistleblowing Protection
Company provides the fraud notice mailbox for all employees and outsiders to report any
integrity-related improper or suspected illegal practices. Reporting with name or anonymous
are both accepted. The Company shall do due diligence to investigate all reported cases andkeep confidential of reporters in accordance with the laws to ensure safety of reporters andno threat or damage to reporters' rights and interests.

Ethics mailbox

Audit Center
Audit Division

Inclusive
Workplaceethics@usiglobal.com

IT Audit Department
China Team 2

Internal Audit Process
Range of audit: All operations and management of finance and business are included.
According to related regulations, there are eight divided circles plus information circle andfinancial reporting flow responsible for respective audit.
Object of audit: All institutes and legal branches around the world of USI.
Audit strategy: The regular audit is practiced based on the annual audit project decided by
the board of directors; a special case audit will be practiced if needed. The goal is to prevent
possible shortages from the internal control system and present improving suggestions.
Besides, the Audit Center urges all departments to practice self-examination and assessment
to evaluate the rationality and effectiveness of the outcomes. The Audit Center will produce
an auditing report after the auditing activity performed. The compiled report will be
submitted to the board of directors as the realization of the Company's governance spirits.

Promotion and Training
To ensure that employees understand and comply with the USI Employee Code of Conduct,
Fraud Risk Management Procedure and The Rule of Punishment for Fraud in the Sunshine
Act. When newcomers accept training, they are given related training courses. All employees
need to finish the required reading and pass the quiz every year. All records are listed as
tracking list to ensure the course of Employee Code of Conduct has been finished by each
employee. Furthermore, the Sunshine Conduct Policies must be conducted to employees
regularly to remind them of relevant corporate regulations and strict observance of rules.
And the Sunshine Conduct is also announced to suppliers every year.
Note 1. Please refer to USI website (https: // www.usiglobal.com / en / csr / Operation-Governance / Code-of-Ethics-And-BusinessConduct) for the complete Code of Business Conduct and Ethics
2. Please refer to USI website (https: // www.usiglobal.com / en / privacy) for our complete Privacy Policy

18

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Governance

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Management

Green Products
and Innovation

Value Chain
Management

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and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

AppendixEnterprise Risk Management
Once the violations of the Sunshine Conduct Policies havebeen verified to be true, the punished personnel must return
unjustified enrichment to compensate company's losses, andtheir bonus, performance appraisal and promotion will be
restricted according to the degree of negligence.
After identified and assessed by risk management process in 6
major facilities in 2021, only Financial Department identified
Fraud as a high risk but controllable item, so there were noimportant corruption cases required for corrective actions.
There were no instances of bribery or corruption discovered in
2021.

Risk Management Committee

Risk Governance Process

To ensure sustainable business achievements, USI organizeda Risk Management Committee to execute annual risk
management activities according to business environment,
industrial trend, and company operations. The function
units of Risk Management Committee should investigate theinternal and external risk factors, evaluate the risk levels, andinspect the effectiveness of activities. According to evaluationof risk level, the committee takes the responsibilities to adopt
countermeasures and ensure the risk management policy canbe executed by each operation unit.

Through worldwide manufacturing sites, business units andfunction units, USI engages Enterprise Risk Management(ERM) project to identify risk events and factors, evaluate
and adopt proper countermeasures to ensure sustainable
management and achieve business operational goals.

Regulatory Compliance
USI has devoted to maintaining the corporate image for years
and strictly complied with national or international laws
and regulations related to corporate governance, financial
management, intellectual property, green environmental
protection and safety rules, labor rights, and fair market
competition. We also cherish customer value, rights, andinterests. The contract review completion rate reached96% (1). For any negative impact on corporate image or
violation of the law, a task force will be formed by USI to takecountermeasures. By the end of 2021, no violations resulting
in a significant penalty (2) or other non-economic punishment
occurred. And we did not use collected personal data forany secondary purposes other than the specific purposes forwhich the personal data was first collected, and there were no
incidents of infringement of customer privacy rights, and no
incidents of customer data leakage.

Note 1. 230 contracts remained to be reviewed by both parties by the end of 2021
2. The definition of significant penalty is sanctions over CNY 65,000

19

Risk
Management
Committee

Operational
Units

Business
Units

Function
Units

Manufacturing
Sites

1. Identify corporate level and operational level risks, list
various risks that are facing by corporate and conduct Topdown ERM Approach by top managements to confirm thefocused items.
2. Conduct Bottom-up ERM Approach by operation units
to check their management risks, inspect internal andexternal risk factors, and show the control results on risk
map according to the evaluation of Risk Level and Control
Effectiveness.
3. Generate a corporate risk report based on risk evaluation
results from operation units and corporate level. Inspect risk
situations, countermeasures, and corporate opportunities.
List corrective actions and risk mitigation plans for the risk
items identified by each operation unit.
4. Monitor quarterly progress of risk mitigation plans toensure the risks are effective controlled and convert thecorporate risk management to the effective behaviors oforganization strategies enhancement.

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Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Risk Assessment Matrix

Risk
Response
Risk
Assessment

Identify focused items
through corporate risk
management by senior
management, andapply Risk Evaluation
Questionnaire tocollect feedback fromeach operation unit.
Manage risks byTop-down and
Bottom-up models to
identify the risk factorsof impact on USI
sustainable development.

Risk Level

Risk
Identification

1. Evaluate the risk
levels from two
aspects•The possibility ofoccurrence•The negative
impacts on ﬁnance,
reputation, andcontinuing
operations
2. Inspect the eﬀectiveness of exist activities,
and evaluate residual
risk after control
activities

Find out and evaluate
countermeasures andcorrective actions tocontrol risks that
include:Implementation
cost and resources
Feasibility andpossible beneﬁt
Proposal lead timeand schedule
planning

H• Outsourcing• Production Schedule• Demand Controls for Raw
Materials• Innovation, Research, andDevelopment• Fraud• Financial DisclosureM• Geographical Politics• Natural Disaster Risks• Natural and Man-made Disasters• Legal and Regulatory Compliance• Quality Management• Compliance with AccountingStandards and Policies• Order Processing• Out of Materials/ Lack of Materials• Shipment Management• Talent Management /Recruitment• Standards of Quality• Planning of Production
Equipment• Capacity Planning• Inventory Management• Factory Equipment Supply• Suppliers Business Continuity
and Social Responsibilities

L• Communication• Enterprise Development• Contract Management• Technology• Supplier Chain Management• Pricing• Economic Conditions / Industry
Trends• Cybersecurity• Marketing / Sales Strategy• Business Concentration• Energy Management andAlternative Energy• Customer Satisfaction

Yes

PartialNo

Control Effectiveness20

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Management

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and Innovation

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Management

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and Occupational Safety

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Appendix

2021 USI Risk Assessment Countermeasures (1~2)
Category

Item

Risk Situation

Countermeasure

Cybersecurity

1. Lack cybersecurity awareness, mistrust
Phish or scam website
2. Leak system account or password
3. System is locked by hacker or data loss

1. Hold regular cybersecurity training courses for
employees
2. Two-factor authentication
3. Regular backup & offsite backup

1. Enhance all employees' cybersecurity awareness
2. Upgrade system safety level and assure corporate
reputation
3. Train the employees' resilience to reduce the hazard
impacts

Supply Chain
Management

Supply chain has been impacted by COVID-19
and natural disaster, the production lines
are facing the risks of manpower shortage,
unstable logistics and key parts shortage

Material storage management, production scheduleand logistics arrangements shall be more flexible
base on the identified supply chain risks

Develop local suppliers to reduce the material risk fromuncertain international transportation schedule

1. In the post-pandemic era, EMS industrial
chain and corporate operations are
impacted, that results in sluggish economic
recovery and highly competitive in the field
2. Due to uncertainty of regional politics, thedecision makers will hesitate and postpone
the major investment decisions

1. Evaluate macro-economy, industry trend andemerging risk. Keep interactions with customers
and stakeholders. Adopt action plans to enhancecompany core competence and operation
resilience
2. Adjust manufacturing sites and business allocation
to reduce regional supply chain impacts fromtrade friction and epidemic; through businessgrowth and merger to enhance the market
placement of non-Mainland China areas
3. Continue to enhance supply chain management
and risk identification; through corrective actions
and progress tracking to ensure supply chain
resilience and sustainability. And adjust purchasing
strategies according to regionalization trend

1. Cooperate with customers to flexible adjust production
facilities and improve products and services value
2. Enhance manufacturing strategy in non-Mainland China
areas and convert local resources to be competitive
advantages; strengthen company global manufacturingservice capability
3. Aggressively develop and build local suppliers' capability
to achieve a win-win situation

Emerging Risk

Strategy andPlanning

Regional Politics

Note 1. Please refer to 2021 USI Annual Report for Risk Management: Section 3: (IV) Possible Risks
2. Please refer to the Climate Change and Carbon Management section for climate change related risks

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Corporate ChanceAbout this Report

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Management

Item

Green Products
and Innovation

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Management

Environmental Protection
and Occupational Safety

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Appendix

Risk Situation

Countermeasure

Corporate Chance

Violate local laws and losing business
opportunities from not following
governmental environmental regulations or
customer's request to plan a comprehensive
energy program

1. USI has bought RECs (Renewable Energy
Certificates) to offset company's carbon emission
since 2018, and climate change was one of the
major topics in USI sustainability committee
2. Mainland China Facilities achieved 100% of
renewable energy usage through I-REC purchased.
USI will continue to enhance energy management
and use alternative energy according to regulatorychanges, customer requirements, and sustainablegoals
3. Continue manage carbon emissions to achieve
2050 Net Zero target

1. Observe, evaluate, and publish the trend of regulations
and customer specifications to enhance the efficiencyof energy usage and innovate low carbon products forsustainable manufacturing
2. Strengthen social involvement to in line withgovernmental regulations by industrial unions or otherstakeholders. Review company sustainable development
through international appraisals. Build corporate positive
image and increase market value

Succession Plan and
Recruitment

Operating risk from imperfect cultivation of
the talent team and management mechanism

1. Build key successor system:(1) Regular inventory the requirements of key
positions(2) Make succession development plans andprovide resources(3) Systematized talent database for ongoingregular tracking
2. Build Talent development scheme:
the development plans of succession talents andpotential talents

1. Ensure corporate sustainable development through a
successor system, and prevent business impact from
unexpected changes in personnel
2. Implement talent development mechanism to ensure
the successors have the capability to perform key
responsibilities
3. Provide diversified development resources to potential
talents, increase development opportunities, and focus
on individual development requirements to improve thepotential talents' retention rate

Disasters

A company cannot normally operate without
effective prevention and crisis management
for emerging infectious disease, it will resultin customers and company's losses

1. Follow procedures for Business Continuity
Management and Enterprise Risk Management
to ensure business continuity and recover the
impacted facilities
2. Prevent and manage the impacts of emerging
infectious disease, such as COVID-19

Through timely emerging risks plan evaluation to update
and implement Crisis Prevention Measures, Emergency
Response Plans, and Business Continuity Plan. It will help
company to convert resilience to core competence

Energy Management
and Alternative Energy

Operation andInfrastructure22About this Report

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Governance

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Management

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and Innovation

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Management

Environmental Protection
and Occupational Safety

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WorkplaceSocialInvolvement

Appendix

Cybersecurity Management
Effective cybersecurity management is fundamental to all operations. To ensure we haveconsensus of cybersecurity goals, USI set up a committee to boost cybersecurity awareness. The
committee members are composed of CIO, CFO, GISO, Vice Presidents or Division heads level
above, CIO shall report to Senior Vice President of Administration Group. Under the committee,
there are information security representatives to assist the Information Security Committee in
implementing cybersecurity affairs. USI obtained ISO 27001:2013 Certification in 2020 and thecybersecurity management is further implemented in the USI Group.

Cybersecurity
VisionInformation Technology Unit
Chief Information Officer

Information Security Division
Global Information Security Officer

Security Architecture
and Operaitions

23

Business Information
Security (Asia)

Information Security
Steering Committee

Business Information
Security (North America)

CIO、CFO、GISO

Strengthen
employees'
cybersecurity
awareness

Ensure theconﬁdentiality,
integrity, andavailability of
information
assetsProtect
customers and
USI's sensitive
information
Establish aholistic
cybersecurity
system and ensure
its eﬀectivenessBusiness Information
Security (EMEA)

Cybersecurity Goals & Vision

Cybersecurity Advocacy and Training

The Company's cybersecurity objectives are to ensure the preservation of Confidentiality,
Integrity, Availability and Compliance of the core systems engaged in business operations.
Additionally, quantitative goals are defined according to organization level and job function toensure the achievements of the ISMS (1) implementations and cybersecurity objectives.

USI has made Enterprise Network Cybersecurity Management Approach and introduced
Advanced Persistent Threat (APT) to increase cybersecurity protection. Through regularannouncement, employees are required to follow network cybersecurity regulations anduse legal software. IT Department spot-checks illegal use of software, any illegal cases will
be punished according to regulations. USI arranges an online training course to strengthen
employees' cybersecurity thinking. All employees should take Cybersecurity courses and passtests. IT also irregularly practices Social Engineering (Phish Insight) to enhance employees'
cybersecurity awareness.

1. Protect USI's important information assets, including USI and customer products,
manufacturing processing information and recipe, R&D information, services, and maintaintheir confidentiality, integrity, and availability.
2. Strengthen USI employee's awareness of the company's and customer's information asset
protection responsibilities.
3. Ensure that the execution of all business comply with the requirements of relevant laws or
regulations.
4. Construct a safe and convenient information network environment to protect employees
from internal and external cybersecurity threats.
5. Establish a cybersecurity sustainability plan to ensure the business contingency.
6. In-depth assess existing cybersecurity level and enhance the maturity of entire
cybersecurity management.

To be a gatekeeper of company cybersecurity, IT members not only take professional
training courses, but also need be certified to ensure the effectiveness of our cybersecurity
organization can systematically solve cyber incidents. USI had no cybersecurity incidents in
2021.
Note 1. ISMS, Information Security Management System

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Green Products
and Innovation

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Management

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and Occupational Safety

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Appendix

Sustainability Management
USI integrates core values of four sustainability strategies, Low Carbon, Circular, Inclusive and Collaborative into corporate policy and operation management. Not only bringing in
the most benefits for shareholders and investors but create social value to pursue the sustainable development of co-existing environment, society, and governance.

We commit toProvide a fulfilling and challenging working environment
Generate exceptional rewards for stakeholders
Contribute towards building a better place to live24

About this Report

Operation and
GovernanceGreen Products
and Innovation

Sustainability
Management

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Management

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and Occupational Safety

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Appendix

Sustainability Committee
USI Sustainability Committee is the highest-level organization of corporate sustainable development management. The committee
covers all manufacturing facilities. The committee's mission has been divided into five taskforces, Corporate Governance,
Green Product & Innovation, Value Chain Management, Employee Care & Social Involvement, and Environmental Protection &Occupational Safety. Committee members are representatives chosen from each department and the President acts as the Chair,Vice Presidents and Division heads act Leaders and Coordinators respectively. Through policies and actions set by the committee
and corporate-wide cooperation, we promote and implement a sustainable business model.

1. Plan Operation Mechanism ofGroup Sustainable Development
2. Coordinate and Promote Group
Sustainability Targets
3. Integrate and Promote Action
Plans of Group Sustainable
Development
4. Evaluate the Executive
Performance of Group
Sustainable Development
5. Disclose Performance of Group
Sustainable Development
6. Study and Develop Group
Sustainable Topics
7. Manage Group Integrated
Sustainable Affairs

1. Evaluate Risks andOpportunities of the SpecificSustainability Topics. Suggest
and Plan the Sustainable
Development Targets of Groupor Specific Operating Area
2. Plan Actions and Assist to
Promote the Actions
3. Track Action Progress and
Evaluate Performance
4. Provide Professional Consulting
and Experience Sharing
5. Submit Recommendation
Report to Group Sustainability
Committee

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USI Sustainability
Committee

Executive Secretariat
S&HS Division

USI Sustainable
Development Taskforces

Corporate GovernanceGreen Product & Innovation
Value Chain Management
Employee Care & Social Involvement
Environmental Protection & Occupational Safety

Manufacturing
Sites

1. Study and Develop the Vision, Policy, andTarget of Group Sustainable Development
2. Identify Risks and Opportunities of Group
Sustainable Topics to Decide Strategies andInvestments
3. Supervise the Plans and Implementations ofGroup Sustainable Strategies
4. Monitor and Disclose Group Sustainable
Performance
5. Report Working Plan and Performance to
ASEH Sustainability Committee

The committee coordinators will hold quarterly meetings;
leaders and task force members will decide and track
the sustainable targets in the meetings. The sustainableachievements will be presented to committee Chair andmembers in the annual Sustainability Committee meeting.
A Sustainability Committee Annual Meeting & Forum washeld on December 14, 2021. Sustainability consultants wereinvited to share and suggest directions for USI sustainable
performance.
To raise awareness about sustainable practices, USI hasa multi-stage sustainability training course in our LMS(e-learning) system. First, all new employees are preliminary
trained to recognize the concept of sustainability. Committee
members and representatives must undertake specialized
training to enhance their capability and knowledge ofsustainable standards and practices.

AFG Group

1. Follow Corporate Sustainability Policy
2. Manage and Implement Site Sustainable
Actions
3. Respond and React to Local Sustainable
Topics Based on Corporate Sustainable Policy
4. Support and Provide Site Sustainable
Performance Data

Sustainability Committee Annual Meeting & ForumAbout this Report

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Appendix

Sustainability Policy

Sustainability Strategy

Through the understanding of Environmental, Social, andGovernance (ESG) dimensions in sustainability, USI considers
that sustainable business development is closely linked
with the interests of employees, community, society, andshareholders. The scope of ESG covers the issues of laborrights, workplace safety and health, environmental protection,business ethics, and social engagement. To accomplish our
ESG goals effectively and meet stakeholders' expectations,
USI set the following measures to achieve sustainability goals.
The complete policy can be accessed at the USI Sustainability
Web (https: // www.usiglobal.com / en / csr / SustainabilityManagement / Policy).

To reach the United Nations Sustainable Development Goals (SDGs) and pursue corporate sustainability, USI follows four
sustainability strategies, Low Carbon, Circular, Collaborative, and Inclusive, to prioritize response SDGs based on the Company's
core values. This enables the Company to take comprehensive actions concerning corporate sustainability.

Environmental

SocialGovernance•Respond to climate action;
Reduce greenhouse gas emissions•Invest in green innovation;
Improve energy eﬃciency•Promote circular economy;
Prevent and control pollutants•Ensure workforce diversity;
Endorse human rights•Stimulate social welfare;Support community investment•Advocate supplier development;
Achieve global partnership•Upgrade corporate governance;
Uphold business ethics•Create company value;
Connect with stakeholders•Drive transparency culture;
Disclose sustainable indicators

CSR/ Sustainability

Low Carbon•Decarbonized Products & Services•Low-carbon Manufacturing•Adapta�on and Resilience•Green and Renewable Energy
Investment

Circular•Circular Design•Energy Resources Recycling•Waste as a Valuable Resource•Circular Economy in Value Chains

Inclusive•Environmental Conserva�on•Industry-academia
Collabora�ons•Community Engagement•Public Advocacy

Collabora�ve•Smart Procurement•Strategic Partnership•Supply Chain Management
Go High Tech
•Environmental Educa�on

Commitments/ Value

26

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Appendix

Strategic Approaches and Targets of Key Sustainable Issues
In 2021, we generated strategic approaches and 2026 targets according to key sustainable issues, tracked the target achievements and published the sustainable missions and performances in theannual Sustainability Committee meeting.
On-schedule

Room for Improvement (1)Corporate GovernanceOn the premise of abiding local regulations andeliminating corruption and fraud, continue toincrease the Company's market competitivenessand ability in evaluating and responding tooperational risks, optimize external communication
channels to establish a rapid, accurate and safe
information network, and train the Company
to develop competencies and skills required forsustainable operations.

Key Issue

Strategic Approach

2026 Target

Assessment Mechanism

Regulatory
Compliance

Implement laws and regulations:
1. Promote legal compliance awarenessthrough training courses
2. Perfect legal compliance management
mechanism and process

Maintain 0 major
regulatory violations

Through monthly governancesanctions & fines datacollection to control major
regulatory violations of eachfacility, and analyze and track
the progress of corrective
actions

Business Ethics

Implement the related policies andspecifications of business ethics:
Continue to promote training courses andreflect business ethics in daily operations

100% coverage of
employee annual Codeof Conduct training

Through e-learning system
to arrange Business Ethics
courses for employees, trackand follow up the completion
rate to ensure 100% coverage

Cybersecurity
Management

Perfect cybersecurity mechanism:
1. Strengthen USI employee's awarenessof the company's and customer's
information asset protection
responsibilities
2. Construct a safe and convenient
information network environment toprotect employees from internal andexternal cybersecurity threats

100% coverage ofannual Cybersecurity
training

Through e-learning system
to arrange Cybersecurity
courses for employees, trackand follow up the completion
rate to ensure 100% coverage

Note 1. For target performance results, please refer to the respective chapter and section for more information

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Management

Green Products
and Innovation

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Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceOn-schedule

Green Products & Innovation
Respond to the trend of global environmental
regulations and make Green Product Specification
to control hazardous substances in the products.
Ensure the green products we manufacture andsell are in compliance with environmental laws,
regulations, and requirements around the world interms of environmental protection, while satisfying
customers' needs and the development trends ofenvironmental protection, following company's
standards for internal control, and continuing
innovation and improvement.

Value Chain Management
Gain satisfaction and affirmation from customers
and users with after-sales service, quality, andsafety of our products. On issues regarding humanrights, morality, and environment, we further ask
the suppliers to establish sustainable partnerships.

Key Issue

Strategic ApproachSocialInvolvement

Room for Improvement2026 Target

Assessment Mechanism

Innovation
Management& Sustainable
Production

Follow green product specifications;continue to develop product innovation andmanufacturing process improvement

Continue encouraging
innovation and green
product design andaccumulate 1,611
patents

Through USI patent review
meeting to oversee patent
proposals and patentrights maintenance. The
review meeting annuallyinvestigates the necessityand effectiveness of patents
to maintain database

Customer
RelationsManagement

Through customer satisfaction survey
to understand customers' expectations
and needs. Precisely answer customers'
questions and provide the best services tocustomers

Score at least 84%
customer satisfaction
rate

Quarterly track the resultsof QBR (1) and customer
satisfaction survey to ensure
the achievement rate

Make sustainable procurement policy toevaluate and audit suppliers' environmental
and social performances, and comply withconflict-free minerals purchasing

Support local suppliers
and achieve 35% local
supplier procurementrate
100% Key suppliers
comply with ConflictFree Policy
More than 76% suppliers
complete RBA (2)Supplier Sustainability
Assessment
Questionnaire (SSAQ)

Calculate local procurement
amount to confirm theachievement rate
Through CMRT (3) survey toensure the achievement rate
Through Supplier
Sustainability Assessment
Questionnaire to calculate
the achievement rate

Sustainable
Supply Chain

Appendix

Status

Note 1. QBR, Quarterly Business Review
2. RBA, Responsible Business Alliance
3. CMRT, Conflict Minerals Reporting Template28

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceOn-schedule

Environmental Protection &Occupational Safety
In response to climate change and global
environmental issues, enhance USI's capabilities
in resource utilization and pollution prevention to
reduce environmental impact during operations.
Promote OHS culture, enhance USI's capabilities
in risk management, injure prevention, andemergency response to create a safe and healthy
workplace.

29

SocialInvolvement

Appendix

Room for Improvement

Key Issue

Strategic Approach

2026 Target

Assessment Mechanism

Air Pollution
Control

Obey local laws and regulations to manage
air pollution, implement air pollution
control, continue to monitor and reduce air
pollution

0 air pollution violations

Quarterly check and confirm
facilities air pollution
emissions without violations

ClimateChange1. Apply ISO 14064-1 to implement andmanage greenhouse gas inventory
2. Through TCFD mechanism to understandoperational risks and chances to makecountermeasures

Maintain ISO 14064-1:
2018 certification for
all facilities

Finish greenhouse gas
inventory to pass annual ISO
14064-1 evaluation.
Through annual TCFD
evaluation to make
operations strategies

EnergyManagement

1. Implement ISO 50001 quality
management system
2. Improve renewable energy usage rate
3. Promote energy saving program in
facilities
4. Promote green building project

Reduce energy
consumption intensity
by 11% from thebaseline year 2015

Monthly review energy
consumption, and promoteenergy saving projects
and improve renewableenergy usage to ensure
the performance of energy
consumption intensity

Occupational
Safety and
Health

1. Implement ISO 45001 to ensure themanagement scope covers all employees
and the related workers
2. Establish internal risk assessment
3. Promote EAP (Employee Assistance
Program) and health promotion programs

No major occupational
injuries
No major occupational
diseases
No major infectious
diseasesThrough Safety and Health /Production Committee to
track the progress of filed
projects and departments'
KPIs

StatusAbout this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceOn-schedule

Employee Care & Social Involvement
To build an inclusive workplace for employees,
we Enforce Human Rights Policy, Enable Talent
Development, Provide Comprehensive Benefits,
and Cultivate Harmonious Labor Relations to createa happy workplace. And we promote and expand
social engagement through Investing in Education,
Contributing to Society, Promoting Arts & Culture,and External Participation to make a positive social
impact on our surrounding communities.

@

Appendix

Room for Improvement

Key Issue

Strategic Approach

2026 Target

Assessment Mechanism

TalentAttraction &Retention

Establish a comprehensive welfare systemand harmonious labor relations:
1. Encourage employees actively toparticipate company activities
2. Understand employees' needs andrecognition through employee
engagement survey
3. Maintain labor relations, provide acompetitive salary and welfare system

Employee engagementscore over 85%
IDL turnover rate
under 10% and DL
turnover rate under50%
Key talent retention
over 90%

Hold employee engagement
survey every two years tounderstand employees'
opinions
Track turnover situation
every month / quarter / year
and provide improvement
plans

Human Capital
Development

Integral talents development mechanism:
1. Plan suitable training programs toachieve information sharing and learning
mechanism in facilities
2. Provide a challenging and valuable job
career and promotion opportunities

Accumulate morethan 1,000 lecturers
through the internal
lecturer training
programStrengthen employee
sustainable
employment
ability and lifelong
learning program,support more than
80 employees get
diplomas / degrees

Quarterly track the situationof lecturer training program,and perfect internal training
resources
Annual track the employees
number of obtaining degrees,and organize in-service
educated programs inside
the company

Human Rights

Enforce human rights protection: No forcedlabor; prohibition of using child labor;
non-discrimination; anti-harassment;
freely association; respect employees'
privacy; follow the regulations of working
hour; manage and reduce risks of humanrights to create a working place without
discrimination

100% introduce
human rights risks
assessment across all
global facilities
Hire more than 120
people with disabilities

Perform human rights risk
assessment every year andtrack the improvement plans
every 6-month to reduce therisks of endangering humanrightsAnnual track the employment
status of disabled employees
to implement the diversified
workplace policy

Appeal Channel
Stakeholders can feedback or appeal throughmeetings, e-mail or Contact USI in USI website. Except
internal meetings, the other appeal channels could beanonymous to secure whistleblowers' rights.

SocialInvolvement

Status30

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Sustainable Impact Assessment

Employeeengagement &development
517.3
Social
Education cohesive
6.7
Health & safety
15.2
124.0

Partnership
16,125.9

Sustainability Value and Impacts

2021
Sustainable Value

CNY 25,786
e
old
h
e
r
S ha

act

rs

NGO

Proﬁts1,856.7sn m e nta l I m p

Comm
uni
ty

nomic Impact
Eco

Em
plo
y

Government

31

Payroll
3,696.0

Greenhousegas emissions
-11.1

s
ee

Social dimension: The major performances were good relationships with suppliers
and human capital cultivation. USI holds a Sustainable Value Chain Webinar every
year to promote company ESG policy. Human capital cultivation was executed by
employee engagement survey to exhibit employees' working performances and values.
While creating economic performances, company also actively engages in community
construction and sustainability development, and contributes to society through various
charitable activities.

tomers
Cus

s
er
pli

Environmental dimension: The major negative impacts were Water Consumption andGreenhouse Gas Emissions. Through process water recycling system, the positive benefitof recycled water has been increasing every year. The recycled water rate was 27.5% in
2021, and the renewable energy rate was improved to 80.3% by purchasing certified
renewable energy. On the other hand, USI's long term cooperation in NPO-led tree
planting project mitigates environmental impact.

Social Impact

Su pEconomic and Tax dimensions: USI has been an industry leading position andcontinuously improving core competitiveness through steady operation strategies. In
2021, USI achieved new high business profit bringing excellent benefits to shareholders,
suppliers, employees, and government. Another major value was created by payroll.
Company supports a comprehensive compensation mechanism though the growing
numbers of employees, that does not only attract and retain talents, enhance employees'
cohesiveness and activeness, but also guarantee employees and company steady growth.

Investment
1,244.3

v iro

Through TIMM assessment, USI generated CNY 25,786 million worth of sustainability
value for stakeholders in 2021 that created positive and outstanding contributions.

En

USI establishes value management system step-by-step and implements sustainability
strategies to realize sustainability goals. We introduced SROI (Social Return of Investment)
and EP&L (Environmental Profit and Loss) in 2019 and 2020 separately to manage social
projects' performances and make effective decisions on environmental issues. In 2021,
USI implemented TIMM (Total Impact Measurement and Management) to inventory the
impacts and contributions to stakeholders from company's operations in Economic, Social,
Environmental and Taxes in hopes to help company to improve operation performances
through key management indexes correction.

Tax I m pact

Air pollution
-1.3
Water
consumption
-14.4
Waste
-2.2
Recycle water
4
Tree planting<1

Intangible assets
1,744.2
Proﬁt taxes
206.3

Other taxes
274.3

Unit: CNY million

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Stakeholder Engagement
Material Issues Identification
USI has identified major sustainability issues and established a framework for ESG disclosurein compliance with the GRI Standards, AA1000 SES (Stakeholder Engagement Standards) andAA1000 AP (Accountability Principle). The framework is established on the four major principles
of Inclusivity, Materiality, Responsiveness, and Impact. Also, this framework is referenced
for USI's long-term sustainability goals and strategies. As an integral basis for reviewing oursustainable development strategies, we value and solicit interaction and communication with
our stakeholders by understanding their concerns through various communication channels.

Further analyzing the results, the differences between the material issues in 2021 and theprevious year can be mainly attributed to the continuing influence of COVID-19, the increasing
importance of climate change, privacy, human rights for all stakeholders, and USI's expansion.
Work from home, worker shortages, investment in talent development, and net-zero action planselevated Cybersecurity Management, Data and Privacy, Climate Change, Talent Development,
and Human Rights to material issues.

Phase I. Inclusivity

Phase II. Materiality

We reviewed and defined our stakeholders through USI Sustainability Committee, listing

In 2021, we conducted a Stakeholder Concern Survey, analyzed, and identified material issues

stakeholders with whom we have a close relationship. The list of major stakeholders is based on

for 996 stakeholders. Respondents included shareholders / investors (11), customers (11),our previous stakeholder identification results and follows ASEH requirements. Shareholders /employees (562), suppliers / contractors (348), government (9), industry unions / associations

investors, customers, employees, suppliers / contractors, government, industry unions /(6) and communities (49). Then, we invited 84 senior managers and committee members to

associations, and communities (including NGOs and the media) were identified as the 7 major

take the Operational Impact Survey to measure the impact of each sustainability issue on thestakeholders.

company's revenues, risks, customer satisfaction, and employee engagement. The results are

We integrated GRI Standards, Sustainability Accounting Standards Board (SASB) Standards,

taken and analyzed with the results from the Stakeholder Concern Survey.

Task Force on Climate-related Financial Disclosures (TCFD), Sustainable Development Goals(SDGs), Responsible Business Alliance (RBA) Code, Morgan Stanley Capital International (MSCI)ESG Rating, and S&P Global Corporate Sustainability Assessment (CSA) with our operational
characteristics and ASEH's requirements and summarized them into 8 governance issues, 5
environmental issues, and 7 social issues, 20 sustainability issues in total.

Step 1

Step 2

Identify Stakeholders
7 stakeholders

Design Sustainability Survey
20 issues summarized

Phase III. ResponsivenessStep 4

Step 3

Investigate Stakeholder
Concerns
996 feedbacks

Analyze Operational Impact
84 senior executives and
USI Sustainability Committee
members participated

Phase IV. Impact

32

About this Report

Identify Stakeholders
7 stakeholders
Operationand Sustainability

Governance

Design Sustainability Survey
20 issuessummarized Value Chain
Green
Products

and Innovation

Management

Management

Investigate Stakeholder
Concerns
996 feedbacks
Environmental
Protection

and Occupational Safety

Phase III. Responsiveness

Phase IV. Impact

The Stakeholder Concern Survey and Operational Impact Survey were analyzed to identify
the priorities of governance, environmental, and social issues. The issues were divided
into material issues (13 items) and non-material issues (7 items). We selected 23 topics
referring to the GRI Standards that respond to material issues identified, highlighted 2 topics
according to the Company's industrial characteristics, and added 4 ASEH required topics.
Energy Management and other non-material issues are disclosed annual drive priorities andperformance in this report as they are also important in the sustainable development of USI.

USI's five Sustainability Taskforces have formulated management strategies for all
major ESG issues. Members of each Taskforce have jointly determined 21 long-termsustainability goals. In addition to quarterly Executive Team meetings, the Sustainability
Taskforces also meet semiannually to review the progress of each goal. At theannual Sustainability Committee meeting, we review our achievements, make rolling
adjustments, track sustainability trends, and manage the impact of our sustainability
goals. We publicly disclose the direction, progress, and performance of our ESG
sustainability objectives in our annual ESG Report.

Scope and Structure of the Report: Following the principle of comparability, our 2021 ESG
Report follows the material issues and coverage of the previous year. The structure of thisreport is based on material issues identified from stakeholder concerns and operational
impact, as well as feedback from experts and scholars, fully disclosing USI's current policy
and plans for fulfilling ESG sustainability development.

Step 5

Step 6Deﬁne Material Topics and Boundaries

Identify Material Issues
13 material issues

Materiality Matrix

23 speciﬁc topics
6 other topics
6 manufacturing facilities

Step 7

Step 8Formulate Long-term
Goals
21 long-term goals

Evaluate Impact
7 regular meetings

Material

Non-material

High

1

2

3 4
8

5

6

7

9

Stakeholders’ Level of Concern

10 11 12 13

1 Regulatory Compliance

8 Climate Change

14 Economic Performance

2 Business Ethics

9 Air Pollution

15 Water Resource

10 Occupational Health

16 Energy Management

3 Customer RelationshipManagement

4 Sustainable Supply Chain
5 Innovation Management

and Sustainable
Manufacturing

Prevention
and Safety

11 Talent Attraction

and Retention

12 Talent Development

6 Cybersecurity Management 13 Human Rights

14

7 Data and Privacy

15 16 1718 19 20Low

33

Analyze Operational Impact
84 senior executives and
USI Sustainability
Committee
Inclusive
SocialAppendix
members participatedWorkplace
Involvement

Level of Operational Impact

High

Governance

Environmental

SocialManagement

17 Waste and Circular
18 Diversity and Inclusion
19 Social Involvement
20 Work from Home

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Material Issues, Topics of GRI and Influences
Boundary
Material Issue

GRI Topics

Influence
Supplier

Regulatory
Compliance

307 Environmental Compliance
416 Customer Health and Safety
417 Marketing and Labeling
419 Socioeconomic Compliance

Ensure we comply with all applicable laws and avoid operationaland financial risks from illegal activities through preventive
measures.

Business Ethics

205 Anticorruption
206 Anticompetitive Behavior

Establishing a culture of integrity and accountability throughbusiness conduct and ethics is one of the keys to long-term
operation and success.

Customer
RelationshipManagement

ASEH Material Topics

Sound customer relationship management helps increasecustomer satisfaction and loyalty to effectively improves
profitability and core competitiveness.

Sustainable
Supply Chain

204 Procurement Practices
308 Supplier Environmental
Assessment
414 Supplier Social Assessment
Conflict Minerals Management (2)We co-work with supply chain partners to commit to corporate
sustainability, environmental protection, labor and social welfare,and promote environmental / social performance auditing
assessment of suppliers to avoid purchasing conflict minerals.

Innovation
Management
and Sustainable
Manufacturing

302 Energy
416 Customer Health and Safety
ASEH Material Topics
Continuous Improvement Program (2)We are committed to innovative green technologies to reduce
production costs, improve efficiency, and continuously reduceresource waste and energy consumption. In addition, the value
chain business model strengthens our core competitiveness andexpands the scope of green R&D technologies.

Cybersecurity
Management

ASEH Material Topics

Cybersecurity is the foundation for maintaining the safe operationof all services. We ensure cybersecurity through network security
maturity assessments, operational cybersecurity health checks,
and regular disaster recovery drills for information systems.

Data andPrivacy

418 Customer Privacy
ASEH Material Topics

We maintain confidential business information responsibly andprotect personal information privacy to ensure all rights are notcompromised.

GovernanceInternal(1)

Customer

Impacts
Community

DirectBusiness

Note 1. The internal boundaries cover our six major manufacturing facilities, namely Zhangjiang Facility, Jinqiao Facility, Shenzhen Facility, Kunshan Facility (above facilities are Mainland China Facilities), Nantou Facility, and Mexico Facility. The disclosure boundaries of Energy andEmissions will be explained in the Environmental Protection and Occupational Safety chapter
2. Conflict Minerals Management and Continuous Improvement Program are USI Specific Disclosure topics

34

Operation and
Governance

About this Report

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Boundary
Material Issue

GRI Topics

305 Emissions

Climate change has become the focus of global environmental
issues, and our operations are increasingly dependent onenergy for growth. Hence, we are facing expectations from ourcustomers and the government, among other stakeholders, toincrease the use of renewable energy.

305 Emissions

Air pollution is gradually worsening and seriously affecting
people's quality of life. We use different control equipment forvarious pollutants to treat our emissions and meet regulatory
standards.

Occupational
Health and
Safety403 Occupational Health and Safety

We have adapted an occupational safety and healthmanagement system in all our Facilities to prevent occupational
hazards and enhance emergency response. USI also works with
contractors to maintain a safety culture and provide workers
with a safe and comfortable working environment.

TalentAttraction andRetention

202 Market Presence
401 Employment
402 Labor / Management Relations
405 Diversity and Equal Opportunity

Enhance our competitiveness and become an attractive
employer by providing competitive salary and benefits,
understanding employees' needs, recognizing employees'
performances and efforts, and maintaining labor relations.

TalentDevelopment

404 Training and Education

Plan suitable training courses for each job, implement
information sharing and learning mechanisms across Facilities,
and enhance the employee career development roadmap tohelp achieve business objectives.

Human Rights

406 Non-discrimination
407 Freedom of Association andCollective Bargaining
408 Child Labor
409 Forced or Compulsory Labor
412 Human Rights Assessment

Safeguard human rights in accordance with international
standards on privacy, personal data, child labor, foreign migrant
workers, forced labor, discrimination, freedom of assembly,
equality / fairness, and conduct human rights risk assessmentand mitigation measures to build an inclusive and nondiscriminatory workplace.

Environmental
Air Pollution
Prevention

Social35

Impacts

Influence
Supplier

ClimateChangeAppendix

Internal

CustomerCommunity

DirectBusinessAbout this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Stakeholder Communication
In light of issues that highly impact the corporate operations and stakeholders are highly concerned about, to meet their expectations, we have built a good communication platform, adopt relevantcorresponding strategies, and maintain and strengthen the relationship between the Company and stakeholders. Issues that they are not so concerned about also will be responded to in each chapter of the report.

Stakeholder

Stockholder /Investor

Customer

Supplier /Contractor

Material Issue
Economic
Performance
Talent Attraction
and Retention
Regulatory
ComplianceBusiness Ethics

Business Ethics
Occupational Healthand Safety
Human Rights
Water Resource
Management

Occupational Healthand Safety
Customer
RelationshipManagement
Human Rights
Sustainable Supply
Chain

Communication Channel
Board meetings
Annual general meeting
Regular reports (quarterly / semiannual / annual report)
Telephone conferences
Investor Relations on USI website
Shanghai Stock Exchange-SSE
E-interaction
Receptions, visits, and roadshows (1)Other interim announcements

RBA-Online
After-sales service system (e-RMA)
Customer's satisfaction
questionnaire
Mail

Quarterly business review
Business meetings
Supplier evaluation
Purchase contracts / Conducts
Training of suppliers
On-site audit for suppliers
Questionnaire investigation for
suppliers
Supplier sustainability conferences

Frequency
Non-periodic
Yearly / Nonperiodic
Periodic
Quarterly
All the time
All the time
Non-periodic
Non-periodic

All the time
All the time
Quarterly
All the time

Quarterly
Non-periodic
YearlyIn contract
periodNon-periodic
Non-periodic
YearlyYearly2021 Performance

Section7 board meetings were held.
Held 2 shareholders' meetings to explain our operating performance, investment plan,
passed 2021Y employee stock ownership plans and respond to investors' concerns.
USI discloses the Company's financial information through regular reports (quarterly /semi-annual / annual reports) published on the SSE website and analyzes the Company's
business situation and data accordingly.
Held a telephone conference each quarter to explain USI's production and management
to investors.
Participate in brokers' strategy meetings and receive investors during their visits.
Participate in Yicai roadshow programs to promote and advertise to investors.

Financial
Performance andTax Governance
Talent Attraction
and Retention
Business Ethics andCompliance
Board Governance

Report Self-Assessment Questionnaire (SAQ) assessment status and results through the
RBA-Online platform.
Constant monitoring of RMA (2) status through the system (e-RMA).
Carry out satisfaction surveys each quarter through sales associates, and the main
customers satisfaction is 84%.
USI set up information security committee to implement NIST CSF (3) maturity assessment
tool, and continuous improvement cybersecurity management capabilities to enhance
assurance for customer.
We held the Cybersecurity General Fundamentals Course to boost employee
cybersecurity awareness.

Business Ethics andComplianceOccupational
Health and Safety
Human Rights
Protection
Waste
Management
Cybersecurity
Management
Customer Service
and Satisfaction

Continue to promote green supply chain, ask, and help suppliers to pass quality
management system certifications. Control the usage of raw materials to ensure theproducts and materials correspond to the regulations of USI green products.
34 new suppliers were subject to evaluation and 32 of them were approved and became
to USI's Approved Vendor List (AVL).
In addition to the compliance with purchase contract, suppliers must sign the
Supplier Code of Business Integrity and Supplier's Commitment to Corporate Social
Responsibilities.
A total of 475 each category contractors join our occupational safety and healtheducation and training.
Suppliers are selected each year to carry out on-site inspection for RBA. The number ofsuppliers were selected was 83.
A supplier survey is conducted irregular to comprehend the current situations and trendsof suppliers. A total of 419 suppliers were surveyed.
We held an online supplier sustainability briefing in Mainland China to promote ourpolicies and philosophy and explained USI's ESG requirements for suppliers and shared
future goals. A total of 276 supplier partners attended the online sharing session. We
also held 24 Executive Business Review (EBR) meetings with material suppliers and 14
new product and technology presentations.

Occupational
Health and Safety
Customer Service
and Satisfaction
Human Rights
Protection
Supply Chain
Management

Note 1. Roadshows: Roadshows are used to promote the issuance of securities, referring to securities issuers' promotion activities targeting institutional investors before the issuance of securities, and is an important promotion and publicity tool to facilitate the successful
issuance of shares with full communication between investors and financiers.
2. RMA, Return Merchandise Authorization
3. NIST CFS, US National Institute of Standards and Technology Cybersecurity Framework

36

About this Report

Stakeholder

Employee

Government

Industry
Union /
Association

Community(NGOs and theMedia)

37

Operation and
Governance

Sustainability
Management

Material Issue

Work from Home
Occupational Healthand Safety
Talent Attraction
and Retention
Talent Development

Occupational Healthand Safety
Social Involvement
Water Resource
Management
Business Ethics

Occupational
Health and Safety
Talent Attraction
and Retention
Waste and Circular
Air Pollution
Prevention

Air Pollution
Prevention
Waste and Circular
Climate Change
Human Rights

Green Products
and Innovation

Communication Channel

Employee Welfare Committee / staff
congress
Employee Relationship Website
President's symposium
Industrial relations meetings
Training programs
Employee engagement survey
Newsletter
Announcement

Official document
Governmental agencies briefings /public hearings / seminars

Industry conferences
Industry Union /Associations
conference forum
Member meeting

USI Website / Email / Direct line /Press release
Community activities

Value Chain
Management

Frequency

Quarterly
All the time
Quarterly
Quarterly
Non-periodic
Every otheryear
Quarterly
All the time

Non-periodic
Non-periodic

Non-periodic
Non-periodic
Non-periodic

All the time
Non-periodic

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

2021 Performance

SectionHeld a workers' conference each quarter to discuss and plan recent activities related to
employees and propose employees' opinions.
"Employee Relationship Website" is set up in USI's intranet. In addition to providing
information regarding employees' welfare and activities, employees can share theiropinions in the "suggestions box for employees" on the website. And a total of 702
employee opinions were given back.
President's Symposium was held each quarter for the general manager to announce thefuture trend and expectations of USI to colleagues. Additionally, the president can listen
to employees' opinions in the meeting. Total held 116 employee symposiums.
Company has been established to irregularly provide employees with various educational
training programs to perfect their professional skills. Every employee received 30.7 hoursof training on average.
The Company adjusts employees' salaries based on the salary management system
for six consecutive years; for outstanding employees, the Company provides a stock
subscription plan to reward employees; in 2021, USI will increase salaries by 6% to
16% in Mainland China, 2% to 4% in Nantou and 5% to 13% in Mexico to maintain its
competitiveness in the talent market.
Share the experience of high-ranking officials through the Company's quarterly
journals and WeChat group and understand information such as the latest industrial
developments, health education knowledge, employee activities, and so on. Held 111
employee activities and 410 employee health education trainings.
In response to COVID-19, we increased the insurance coverage for our employees, andprovided them with the necessary supplies to protect themselves. To ensure employees
can work remotely, in addition to adapting Microsoft 365, we conducted a telework drill
with 63% participation rate in February to smooth out bugs before promoting work fromhome. About 60 employees applied for long-term telework afterwards.

Occupational
Health and Safety
Talent Attraction
and Retention
Human Capital
Development

Actively participate in briefings / public hearings / seminars held by competentauthorities.

Occupational
Health and Safety
Social Involvement
Water Resource
Management
Business Ethics andCompliance

Actively participate in conferences or forums held by Industry Unions or Associations.
We participated in 40 external organizations.
Publish operating results and development direction periodically.

Occupational
Health and Safety
Talent Attraction
and Retention
Waste
Management
Air Pollution
Control
External
Participation

Draw up environmental protection, occupational safety & health (ESH) Standard
Operation Procedure and measures of environment safety communication, consultancy,and participation. Keep friendly relationships with community residents.
Actively participate in social activities and establish a good relationship with the local
communities we operate in. Held 68 philanthropic social activities.

Air Pollution
Control
WasteManagement
Climate Change
and Carbon
Management
Human Rights
Protection
Social Involvement

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Green Products and Innovation
In response to the latest changes in international environmental regulations, we have integrated and developed "Green Product Specifications" to control the hazardous
substances contained in electronic components and products. Our design and R&D employees have the ability to design products ecologically to ensure that the green products
manufactured and sold meet the requirements of environmental regulations in various countries, as well as customer needs, environmental development trends and theCompany's internal control standards. We have made continuous innovation and improvement in quality, cost, delivery, service, efficiency and safety in manufacturing related
operations and processes.

696
78.76
2,332
1.64
92
96

Cases Patents Accumulated

CNY

Million CIP Cost Saving

Employees R&D Job Function

CNY

Billion R&D Spending% Eco-design Product Revenue Ratio

GWh Product Energy Efficiency

38

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
Workplace

Key Performance and Targets
SDGs

Business Action

39

Achieved

2021 Key Issue

KPI

Promote developmentoriented policies tosupport production,
job creation, creativity,and innovation

Patents andResearch

Apply forgreen productand design
proposalContinue to apply
for green productdesign proposals

Reduce energy
consumption in the
production process
and reduce CO2
emissionsContinuous
Improvement

Continuously
introduce
proposals for
improvement

Adopt green productdesign to improveenergy efficiency andreduce waste

SocialInvolvement

2021 Performance

StatusNot Achieved

2022 Target

2026 Target

696 patents
accumulated

Continue the
incentive system forgreen product anddesignContinue the
incentive system
for green productdesign, targeting acumulative numberof patents to 1,611

Continuously
introduce proposals
for improvement ineach facility

304 approved
proposals forcontinuous
improvement

Continuously
introduce proposals
for improvement ineach facility

Continuously
introduce proposals
for improvement ineach facility

Internationalenergyconservation
certification

All internal
power supplies
complied with
80 Plus Titanium
certification

All internal
power supplies
complied with
80 Plus Titanium
certification

The conversion
efficiency of the ACDC internal power
supply complies with
80 Plus Titanium
certification

The conversion
efficiency of the ACDC internal power
supply complies with
80 Plus Titanium
certification

Miniaturized
designOn handheld
devices, continue
to use the latest
generation of radio
frequency (RF)connector, which islight and compact
and materials saving,with a utilization
rate of more than90%

5 products use thelatest generationof RF connectors tosave materials, witha utilization rate ofmore than 90%

Design Wi-Fi Modulewith better energy
efficiency to saveenergy (Target toSave 30% Power)

Develop miniaturized
antenna design toreduce material andenergy consumption
and reduce its carbon
footprint (Shrink
Antenna Size by 25%)

Green Design /Green Product2021 Target

AppendixAbout this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

AppendixResearch Patents and Continuous Improvement
Research and Patents
USI provides diversified manufacturing services for customers. The engineering
team assists customers in reviewing product designs for the optimal balance
between quality and cost before mass production. For the same quality, weoffer suggestions to improve product design and manufacturing costs to reacha win-win strategy. For staying ahead of intelligent trends, the Nantou Facility
started to promote industry 4.0 since 2015 and kicked off the Ten-Year to Win
Project. We expect to develop smart manufacturing capability in USI worldwide
facilities and create better operating performance for investors. For years
company has presented research performances to the electronics industry
through applying patents and international journals.
USI has 2,332 R&D employees, accounting for 9.42% of the employee
population and invested CNY 1.641 billion, accounting for 2.97% of the revenue
in 2021. The number of products shipped was 1,000,628,071 (1).

3.91

3.69

3.31

1.58
1.31

Annual Filed Application

180
58 59

163
46 44

2.97

Facility

1.64

1.37

Zhangjiang

R&D Intensity (%)

2019

2020

76

56 39

2019

2020

Annual Granted Application
Accum. Filed Patent (Pending)
Accum. Effecitve Granted Patent

44
2021

Four of the proposals involved green process designs and have passed internal patent review meetings. The
green process proposal is to increase the proportion of automated and unmanned factory operations by
reducing work hours, lowering labor costs, or improving efficiency to achieve energy and carbon savings in theprocess.

R&D Spending(in CNY billion)

2018

173

165

Green Proposal

2021

KunshanNote 1. Please refer to page 19~20 and 22 in the 2021 USI Annual Report for detailed information
2. AGV, Automated Guided Vehicle

Proposal Benefit

Testing Pen Device

The device performs fully automatic scanning, loading and response
testing. This saves labor, reduces working hours, and improves productivity.

Automatic clamping
device for chip test fixture

The device drops the rotating head to the clamping point and uses thebearing on the rotating head to clamp onto the fixture, thus reducing thenumber of operators needed.

Cart positioning
equipment andpositioning method

Design cart rack, apply six-axis robot to replace manual clamping of pallets
on the rack, AGV (2) replaces manual transport of the rack to supply to the
production line, thus reducing the number of operators, lowering laborcosts and realizing the objective of an automated and unmanned factory.

Pallet transfer device
and material counting system

Automatic pallet loading and unloading mechanism design, saving
manpower working hours, reducing the duration of personnel contact with
X-ray machines, thus reducing health impacts for exposure to radiation.

1.02

2017

696

660

628

589

2018

R&D Spending and Intensity
3.43

In terms of patents, to encourage research, development, and innovation, USI set up Patent Management andIncentive and regular R&D competitions. After the project has been verified, employees that proposed thepatents will be financially rewarded and publicly recognized. By the end of 2021, an accumulative total of 696
patents had been obtained. The accumulative approved patents increased by 36 cases comparing with 2020.
The patents obtained in the last four years are shown in the figure.

40

About this Report

Operation and
Governance

Sustainability
Management

Value Chain
Management

Green Products
and Innovation

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Continuous Improvement Program
Continuous Improvement Program (CIP) proposes improvement plans for the quality, costs,
lead time, services, efficiency and safety of manufacturing related operation and procedures. Its
purposes are as follows:●

Build a platform to realize ideas and approve employees' endeavors and awards●

Encourage employees devoting to continuous improvement●

Enhance teamwork and enterprise competitivenessAfter the 2021 annual performance examined and approved by CRC, the actual tangible costsaving was CNY 78.76 million, mainly from the innovative automatic design of the Zhangjiang
Facility. Please refer to the figure for the details of each facility. The saving cost accounted
for 0.22% of revenue (target value: 0.22%) and a total of CNY 179 thousand has been reward
employees for their commitment to continuous improvement(1).

2021 CIP Performance by Facility

The cases proposed by each facility are reviewed by Site Review Committee (SRC) for theirproject results that including innovation and development capability, actual saving value
attainment capability, technical application capability, standard operation capability, andreproduction operation capability. After the organizer samples the cases, Corporate Review
Committee (CRC) will review their saving benefits and promote cases with reproducible results
to enlarge the benefits. According to the statistics in the figure below, over 250 cases on averageare defined each year.
369

Jinqiao

Nantou21.6%
21.6%

Shenzen
9.7%

356
319

4.8%

17.2%

304

Zhangjiang

275

46.7%

Case
2017

2018

2019

2020

2021

Note 1. Due to discrepancies with quoted figures, the bonus for 2020 was revised to CNY 218 thousand

41

KunshanAbout this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

CIP Excellent Contribution Award
Each facility proposes representative or innovative cases to enter global competitions. Awarded teams are granted trophies and incentive payments. The following table explains the contributionaward and project benefits. In response to the issue of climate change, USI has included Energy Saving and Carbon Reduction in the rating system and the type of key project to promote relevant green
proposals. In 2021, 8 projects achieved the targets, included two Energy Saving and Carbon Reduction projects awarded.

Facility

Ranking

Project Name

Project Benefit
Key ProjectJinqiao

BronzeMedal

Heat Recovery System

Improved heat recovery system to recycle thermal energy into the Facility's air conditioning system, reducing the load on boilers and ice machines,
reducing water, electricity and gas consumption, saving 135,306 kWh of electricity annually and reducing carbon emissions by 606 metric tonnes,
within estimated annual savings of CNY 1,307,703.

Nantou-NK

BronzeMedal

Improve the operation of air
conditioning tank feed pump

Use pressure sensor with two-way valve modification, with three-way valve and inverter variable flow energy-saving technology, so that the feed waterpressure flow supply is stable, maintaining the best operation mode to achieve energy saving and carbon reduction effects, saving 423,948 kWh ofelectricity annually and reducing carbon emissions by 213 metric tonnes, within estimated annual savings of CNY 195,161.

Other Project

Zhangjiang

Gold Medal

Robot arm replacement productin the In-Circuit-Test platform
improvement

The old machine was modified to add suction nozzles and laminated pallets for loading and unloading, which can improve efficiency and productivity,
and reduce the purchase of 8 new machines, so that one person can operate 12 machines. It is expected to save CNY 2,907,317 annually.

Zhangjiang

Silver Medal

NW2009 equipment using
RF switch IC instead of RF
mechanical switch

Design RF switchboard to replace the original RF switch to save equipment investment costs. It is expected to save CNY 3,193,344 annually.

Jinqiao

Silver Medal

Improved laser groove
perforation

Increase delay time and laser power control to improve penetration. It is expected to save CNY 1,458,952 annually.

Zhangjiang

BronzeMedal

Improved laser cutting
productivity

Combine laser cycle mode and new laser cutting method (including a new base design) to reduce laser cutting path and time. It is expected to save CNY
2,377,133 annually.

KunshanBronzeMedal

Screw fixture control system

The locking screw fixture features a foolproof design to prevent the loss caused by worker negligence through statistics. It is expected to save CNY
258,325 annually.

KunshanBronzeMedal

Parallel testing for Function Test

Parallel testing is introduced to reduce the operating time of the entire PCB testing, saving on testing working hours and reducing machine loading rate.
It is expected to save CNY 378,092 annually.

42

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Green Product Management
With respect to the strategies of green management and ecological design on products, and through annual third-party IECQ
QC080000, ISO 14001, and ISO 14064-1:2018 management systems inspections. USI can quickly respond to changes in international
environmental protection laws, directives, and clients' requests. In addition, USI integrates and stipulates Standards for Green
Environmental Protection Products to control hazardous substances in electronic components and products. The design and R&D
personnel of USI have ecological design capabilities for their products, and continue to introduce the concept of green products
and clean technology, which allows our environmental-friendly products to be sold around the world and ensures that the green
products we manufacture and sell are in compliance with environmental laws, regulations, and requirements around the world interms of environmental protection, while satisfying customers' needs and the development trends of environmental protection,and following company's standards for internal control.

Four Main Aspects of Green Product Eco-design
Main Aspect

Environmental Directive

Requirement

USI Design for Environment (DfE)

Hazardous substancesin electronic products

RoHS (1) (Restriction of Hazardous Substances)
REACH (2) (Registration Evaluation andAuthorization of Chemicals)
Halogen-free parts and process requirements
Battery Directive and Packaging and Packaging
Waste Directive

Low polluting
Non-toxic

Phase out the use of BFRs
Phase out the use of PVC
Use non-halogen materials

WEEE (Waste Electrical and Electronic
Equipment)

Recyclable
Easy to takeapart
Easy to process

Reduce the number of tools used totake machines apart
Increase the percentage of recyclable
module designs
Introduce the labeling for recyclable
plastics

ErP (Energy-related Product)
CEC (California Energy Commission)

Energy saving
Resource saving
Reducedenvironmental
impactReduce the energy consumption ofmachinery in standby and off mode
Increase the efficiency of energy
conversion of EPS
Keep machinery in power-saving mode

Reduce volume
Easy tointegrate

Improve the system's functions
Reduce the complexity of the circuit
Reduce the materials usage

Recycling
management ofelectronics

Ecological energy
design of products

Product
miniaturization design

SiP (System in Package)
SOM (System on Module)

Note 1. To date, we have controlled over 300 chemical substances under the Green Product Specifications to ensure that our products are in compliance with RoHS European Union
directives
2. In response to the announcement of adding the 26th batch of 4 Substances of Very High Concern (SVHC), the candidate list of REACH has been extended to 223 substances
3. The current plan is to ban the use of the three substances Indium Phosphide, Nickel Sulfate, and Nickel Amino Sulfate by 2023

43

USI designs green products that meet global regulations basedon the four aspects of Green Product Eco-design, and constantly
improve ecological design capabilities so products can meet
trends in green design. We design products with Eco-Design as
the principle in the planning stages of product development. In
2020, USI introduce a professional green value chain management
platform "Green Parts Aggregations & Reporting System (GPARS)"
and database for environmental hazardous substances (EHS).
The materials we use in our products meet Hazardous SubstanceFree (HSF), RoHS and WEEE requirements. Up to 2021, we haveover 300 chemical substances controlled under Green ProductSpecifications to ensure that our products follow RoHS European
Union directives. In response to REACH's announcement of adding
the 26th batch of 4 Substances of Very High Concern (SVHC), thelist of REACH substances has expanded to 223 substances. For
substances that have not been replaced by technology at this stage,a Prohibited Substance Eradication Plan(3) has been drawn up. In
addition, suppliers must provide Environmental Hazard Non-Use
Declaration and Safety Data Sheet (SDS) or material composition
tables. According to the Design for Environment (DfE) operatingprocedures, USI not only takes potential environmental impacts
under consideration when designing a product, but also have themconfirmed with the project development unit and the customer tomeet the requirements of Energy Star and ErP, as to meet a range
of environmental factors, such as material use, energy saving and
CO2 reduction, efficient use of water resource, pollutant emission,
resource wasting and recyclability, in order to minimize negative
impacts to our environment during the product life cycle.
A green product with clean technology needs to comply with two or
more green product ecological design standards to improve energy
efficiency and reduce environmental pollution. In 2021, green
product revenue accounted for 32.8% of USI's total revenue, which
decreased by 14.8% compared to the previous year, mainly due
to supply shortages and the percentage of green products in eachcategory is shown in the table below. In the future, we will continue
to invest in green product research and development and increase
the proportion of green products.

About this Report

Operation and
Governance

Sustainability
Management

Value Chain
Management

Green Products
and Innovation

The Proportion of Green Product Revenue to the Company's
Overall Revenue
Green Product Category (1)Percentage of Revenue in 2021 (%)

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

To intensify the promotion of green products, USI established the Green Design Innovation andInvention Patent Incentive System at the end of 2017. The objectives thereof are to give greenrelated designs weighted scores; build a green and innovative corporate culture; and facilitate green
design proposals. The results of each product category and green related design are as follows:

Communication Product26.5

Industrial & Automobile Electronic Product2.2

Consumer Electronics & Computer and Storage
Product

4.1

Product Category

Key Features

Total

32.8

Internal Power Supply

Improve energy
efficiency

All internal power supplies complied with
80 Plus Titanium certification

External Power Supply

Improve energy
efficiency

Comply with the EU Code of Conduct Tier
2 (CoC Tier 2) and the latest regulations of
the US Department of Energy (DoE)

ServerImprove energy
efficiency

The DC-DC conversion efficiency of the
DC power supply of the server product ismore than 90%

Wearable Solutions

Improve energy
efficiency
Reduce power
consumption instandbyModularization andcompatibility
Miniaturization

True Wireless Stereo (TWS) uses lowpower IC parts in its SiP design so that its
standby power consumption is below 1mAIntelligent Connectivity
Solutions

Reduce consumables

Continue to use the latest radio frequency(RF) connector in handheld devices
and replace existing parts with smaller,thinner, and lighter components toconserve material use

enterprise Access Point
Product

Improve energy
efficiency

Design products to meet ErP Lot 26
network standby requirements (standby
mode < 8W)

Visual & Specific
Application ProductImprove energy
efficiency
Miniaturization

Develop hearing aid charging products to
reduce the use of disposable batteries andreduce waste

USI's Green Design in 2021

Performance of Eco-designed Products
Product Revenue Ratio (%)

2017

2018

2019

2020

2021

Energy Efficiency

33.3

32.9

34.4

38.6

45.9

Electronic Waste Recycling (WEEE)

12.5

11.2

9.2

6.3

5.2

Light and Compact

49.2

39.6

39.0

41.6

41.0

The Proportion of Total Revenue

95.0

83.7

82.6

86.5

92.1

In our 2021 product energy-saving evaluation, USI's eco-design products saved 95,754 MWh,equivalent to reducing 46,888 metric tonnes of CO2 and accounting for 37.3% of USI's total
revenue.

Product Energy Efficiency Evaluation
Product Category

Energy Saving in 2021 (kWh)Communication Product1,020

Consumer Electronics Product40,011

Computer and Storage Product17,227,481

Industrial Product638

Automobile Electronic Product78,484,431

Total

95,753,581

Performances

Note 1. USI's product categories fall into six categories, and this section does not cover medical categories

44

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Green Supply Chain
The trend toward sustainable development of green product is inevitable. Only by establishinglong-lasting management model of green supply chain could allow industries face up-coming
challenges. As a result, USI ensured that the entire production process which involves productdesign, procurement of materials, manufacturing, transportation, packing, sale, and recycling ofproducts. With an effort to integrate upper and lower-stream partners, USI vowed to create asafe, stable green supply chain, generated the maximum environmental benefits.
We invite our suppliers to join our GPARS platform to communicate and update on relevantchanges in global environmental protection laws, regulations, and customer requirements
for green product standards (RoHS, REACH, and Conflict Minerals). Suppliers can read up on
our newest green product specifications through this platform and go through its certification
process. In addition, our R&D, production, and quality assurance teams can also stay up-to-date
on current standards for our products and take necessary control measures. The systematicmanagement of our global green product supply chain helps us improve data accuracy,
strengthen cooperation with supply chain partners, and achieve a green supply chain.

GPARS / EHS System
GE Staﬀ
Approve
the GP Data
Suppliers

Accept the
GP Request

Upload / Fill /Revise GP Data

Approvalof the GP
Data

EHS
Database

GPARS

Green Education
Besides implementing the green management internally, USI made stakeholders further awareof the importance of environment protection and applied the correct environmental concepts
to various steps in production process (i.e., the product planning, raw material control andgreenhouse gas emission reduction). We keep communicating with its employees, suppliersand contractors regarding our ESH-associated principles, knowledge, and requirements. The
e-learning courses of green education were added to USI's internal training that informed theemployees of GP-related regulations, requirements, operating procedures, and eco-friendly
materials.
CourseCourseContent

Hazardous SubstanceManagement System
Requirements for Green Products• Quality Policy• Hazardous SubstanceManagement System• Green Product Management
System• RoHS (EU) 2015 / 863• Halogen-Free• Green Product Workflow

45

In 2021, the total number of all facilities' green education training hours was 18,713 hours.
To meet customer requirements, USI is not only keen to participate in international forums
that carbon emission disclosure, but also carried out plans for energy conservation and carbon
emission reduction. By instilling the green concepts at internal training programs while drawing
from external experiences in this regard, USI conveyed its green values and fulfilled the Green
Promises.

Green Design Controlling
Process

Green Products Laws and Regulations
Introduction

Green ManufactureManagement

OQC Shipping Area Control• Green Product
Workflow• EU RoHS• China RoHS
• Taiwan RoHS
• Japan RoHS

• RoHS (EU) 2015 / 863• WEEE 2012 / 19 / EU
• Green ManufactureManagement• Global Green ProductEnvironmental Regulations• USI GP and HF Labeling• QQC Items and Standards• REACH• WEEE• Halogen-Free
• CEC
• ErP

Green Part Verification
and Approval• Operating Standards
and Regulations forGreen ProductsAbout this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Value Chain Management
Facing the boundless development trend in the globe, good supply chain management can not only effectively lower production costs and enhance the quality of products to win
more satisfaction, but also expand the company business and social responsibility with partners to create a sustainable future.

84
416
39
276
94

% Customer Satisfaction
Suppliers Conflict-free Mineral% Global Local Purchasing Rate
Supplier Partners Participated in the Sustainable Value
Chain Webinar% New Suppliers Passed Sustainability Assessment

46

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Key Performance and Targets
SDGs

Business Action

2021 Key Issue

Through customer
satisfaction surveys andcomplaint channels,
we gain customer
insight and accurately
respond to customers'
expectations, providing
customers with the best
quality service

Customer
RelationshipManagement

Formulate sustainableprocurement policies,
promote supplierenvironmental / social
performance evaluation
and audit, and avoid
purchasing conflictminerals47

Sustainable
Supply Chain

Inclusive
WorkplaceSocialInvolvement

Achieved

KPI

2021 Target

2021 Performance

Major Customer
Satisfaction

Major Customer
Satisfaction
reaches 84%

Local procurement
rate

StatusAppendix

Not Achieved

2022 Target

2026 Target

Major Customer
Satisfaction is 84%

Major Customer
Satisfaction
reaches 84%

Major Customer
Satisfaction
reaches 84%

Local
procurement rate
reaches 30%

Global Local
Procurement rate is
39%

Local
procurement
maintain at least
35%

Local
procurement
maintain at least
35%

Percentage of target
suppliers completingthe conflict-freeminerals

100% Target
suppliers use
conflict-freeminerals

100% completionof conflict-freeminerals

100% Target
suppliers use
conflict-freeminerals

100% Target
suppliers use
conflict-freeminerals

Percentage ofsuppliers completing
the Supplier
Sustainability
Assessment
Questionnaire (SSAQ)

Suppliers
completing the
SSAQ rate reaches
71%

Suppliers SSAQ
completion rate is73%

Suppliers
completing the
SSAQ rate reaches
72%

Suppliers
completing the
SSAQ rate reaches
76%

Operation and
Governance

About this Report

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Product Value Chain
USI is the world's leading company of D(MS)2 (1) providing design, miniaturization, material sourcing, manufacturing, logistics, and aftersales services of electronic devices / modules for brand owners. In addition to manufacturing services, USI also provides customers
with Turnkey Service (2). Our Product Value Chain and Turnkey Service cover the content as shown in the figures below:

Turnkey Service

Product Value Chain

Materialsourcing
& RFQ

(3)

Supplier
Agent
Contractor

CustomerCommunication

ConsumerIndustrial& Car &
MedicalWearable Device

WW No.1 for
Smart Phone& Tablet

WW No.1 for
Watch, Wristband…

5G SiPLCD X-Y Board

Smart Phone& TabletTV, NB, Monitor

SHD & POSWW No.2 for
Logistics &Warehousing

Power Module
Car LED Lighting
InverterPower Module
xEV Powertrain

Inventory
management

Computer& Storage
VMI hub
management

Products & Market Positions

Wi-Fi SiP

Materialplanning& purchasing

SSD & Array

RMA
serviceEnterprise & SMB

X-86 M/B &Docking

Supplier
management
Systemintegrator
relationship

Server/ WS
Docking for NB
Logistic
arrangements

PCBA & Box
assembly
Note 1. USI provides D(MS)2 product services: Design, Manufacturing, Miniaturization, Industrial software and hardware solutions, and material procurement, logistics, and maintenanceservices for brand owners
2. The essence of Turnkey Service is service integration
3. Material suppliers refers to suppliers of PCBs, substrates, active / passive components, other electromechanical components, mechanical components, packaging materials, andaccessories

48

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Customer Service and Satisfaction
Since its inception, the Company has been providing professional services and quality products
to meet the diversified needs of our customers. We possess cutting-edge product development
and manufacturing capabilities to provide customers with complete services from design to
distribution, and services spanning across global production locations. Regarding technical andsupporting logistics services, USI is committed to providing the most agile and fastest services
close to our customers. Customer satisfaction is a core goal and value pursued by the Company.

service network to effectively control the collection and classification of defective products aswell as resource allocation. Therefore, the relevant units can provide customers with productexchange and failure analysis services. The customers are also allowed to monitor the RMA
status---anytime, anywhere---via e-RMA, where they can apply to the RMA service and submit
status inquiries.

USI After-Sales Services Scope & Categories

To meet or exceed customer needs and expectations provides customers with high-stability,
high-reliability, and cost-advantage products. With the experience and technology accumulation
by working with top clients in the world for years, we integrate the three core technologies:
computing, communications, and multimedia processing, and provide customers with the mostcomplete solution for wireless communication products, computer and industrial applications,storage of products and servers, automotive and video products, and miniaturized products.
USI implementation of quality policies as well as the guarantee on goods and services, acomprehensive inspection must be made for all products before shipment. Only qualified
products can be delivered (outgoing quality pass rate is 100%). There were 1,000,628,071
products provided in 2021. Besides, USI has also passed various international certifications such
as TL 9000, and ISO 9001 (Please refer to the Management Systems Certification Table). Pleaserefer to USI website for our Quality Policy.

All-Encompassing After-Sales Service
The customization of our after-sales services allows USI to satisfy customers' needs with allaround high-quality, high-efficiency and flexible services. Not only has each of our customer
has dedicated personnel, but also, we collect customers' feedback and opinions through regularand irregular meetings and questionnaire-based surveys. Their feedback enables us to, while
understanding their needs, improve our service quality and enhance partnership to create asolution where everyone benefits. Apart from standard after-sales services, USI also provides
customized all-around after-sales services to closely cooperate with our customers and provide
them solutions that really meet their needs.
In terms of after-sales service management, USI adopts e-RMA (1) and SAP (2) systems for global

Note 1. e-RMA, e-Return Material Authorization
2. SAP, Systems Application and Products in Data Processing (It is a world-famous and universal ERP system developed by SAP)

49

Technical
SupportRMA
Service●

After-sales service solutions●

Project rescheduling andreplacement of parts●

Warranty and out-ofwarranty maintenance●

Product repairs●

Product replacements

Spare
Parts

●

Selling regular and critical spareparts/ components service●

On-site technical support at
customer's requirement●

Training program for
maintenance staﬀ●

Test fixture and technical filemaintenance●

Product defect analysis andtroubleshooting●

New product service
technical support

Operation and
Governance

About this Report

Sustainability
Management

Green Products
and Innovation

USI uses on-time delivery rates and maintenance turnoverdays as measurement metrics for our after-sales service (1).
On-time delivery rates are the percentage of batches shippedon time out of the total monthly shipments agreed withthe customer. Maintenance turnover days are the interval
between receiving returned products and their reshipment
date. With USI's wide range of product services, different
returned product quantities and properties will have different
standards for maintenance turnover days. Turnover days in
2021 increased due to COVID-19, which resulted in longer
waiting periods for global supply of materials and shipment
lead times. After clear communication with customers, theagreed on-time delivery rate was 99.5%.

On-time Delivery Rate and MaintenanceTurnover Days
98.5

99.0
%

%

99.0
%

99.5
%

36.0
31.9
29.0
25.3

2018

2019

Turnover Days

2020

2021

On-time Delivery Rate

Note 1. For modularized products, it is not possible to be repaired. Thus, they must be
replaced with new products, and they are included in the calculation.
2. Statistics cover Zhangjiang, Jinqiao, Shenzhen, Kunshan, and Nantou Facilities.

Value Chain
Management

Environmental Protection
and Occupational Safety

Customer Complaints and Product Recall
By following the quality policy of "Each member in the company
shall participate and endeavor for improvement continuously to
pursue the Zero Defect in each operational segment", USI adheres
to "Three Non-Defective Principles": No acceptance of defective
products, No fabrication of defective products, and No delivery ofdefective products. The company is highly concerned about the
products with potential quality issues. USI's R&D and engineering
units are invited to discuss the treatment plans and cause
analysis and the regular study meetings to continuously track thecountermeasure effectiveness as well as to prevent from repetitionof defective products. For the products with safety concerns orbatch issues, the company establishes preventive measures torecall them right away. The losses can be avoided, and customer
lives and properties can be protected from damage.
Regarding customer feedback, we established a system to log
and respond to quality feedback rapidly. Related personnel are
immediately notified when there's feedback. They then will
analyze and propose the most effective solutions to the customers
and take steps to prevent similar issues from arising again.
According to the Company's statistics, there were 3 complaints (2)from key customers in 2021, with a 100% resolution rate and no
product recalls. The main attributes of customer complaints are
summarized and analyzed, and they all belong to manufacturing
process problems. The Company's improvement measures include
designing new molds, adding alarm devices to control the adhesive
dispensing parameters and updating the inspection process to
avoid recurrence of problems and to resolve root cause issues.

Inclusive
Workplace

Appendix

products, service and other, continue to improve the Company's
service quality, strengthen the good cooperative relationshipwith customers, and work together to create the Company's
greatest benefits and value. In response to the results of thequestionnaire survey, relevant units within the Company
hold seminars to formulate feasible response strategies, andeffectively communicate with customers' feedback, needs andsuggestions, formulate improvement plans and action plans,continue to track and monitor the improvement status, andsend feedback of the latest progress to customers constantly,
improving communication quality and customer satisfaction to
obtain customer recognition and long-term support.

Customer Satisfaction Survey Process

1

Start apreliminary survey

3

2

Conﬁrm customer list

Customersatisfaction survey

1. Collect QBR scores
2. Conduct QBR score orcustomer survey

Driving up Customer Satisfaction
In order to ensure effective communication with customers aroundthe world, USI has set up dedicated personnel for all customers tohandle customer service incidents, and actively collects customer
opinions and demands by holding Quarterly Business Review (QBR)
meetings, irregular business meetings, and questionnaire surveys
in order to understand customers' evaluation of the Company's
products in the aspects of quality, delivery, technology, green

SocialInvolvement

5

4

Coordination and review
of analysis reports

Follow up andcase closure50About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Customer Privacy and Product Safety(1)

USI is committed to achieving the annual goal of customer satisfaction . The statistical results of major customer(2)
satisfaction in 2021 showed that the overall satisfaction rate was 84% (Successful). In terms of individual
satisfaction dimensions, except for "Delivery" and "Other" which did not reach 80%, all the other dimensions
reached "Successful" or above. For dimensions that do not meet the required standards, we continue tocommunicate with our customers to receive their feedback and make all necessary improvements. USI strives
to improve customer satisfaction in all aspects to achieve a higher level of customer satisfaction for sustainablecorporate development and to maintain an annual goal of "Successful" or higher, with the expectation of moving
towards "Excellent" in customer satisfaction in the future.

Major Customer Satisfaction Over the Years
Quality
100%
95%

84%

84%

90%

Other

Delivery

85%
80%

83%

75%
70%

82%

Service
2018

2019

2020

Technology

2021

Green Product

2018

2019

2020

2021

Note 1. Definition of Customer Satisfaction Score: Outstanding (Satisfaction ≥ 90%), Excellent (Satisfaction ≥ 85%), Successful (Satisfaction ≥ 80%),
Improvement Required (Satisfaction ≤ 80%)
2. Major customers refer to the top 20 customers with the best annual revenue (accounting for above 90% of USI revenue) according to USI
President Office data

51

Confidential customer information and customer health and safety are always treatedwith the highest priority as they are crucial assets for both parties and the basis
for mutual trust. USI has management procedures to control and restrict access toconfidential information to avoid endangering customers' health and safety. If thecompany violates relevant regulations or our products harm customers' health andsafety, it will seriously damage our image and cause financial losses.

Customer Privacy
USI commits to maintaining customer privacy and data confidentiality. We set
systems and procedures in place to center customer privacy and data confidentiality
as the foundation of all business contracts. In addition to signing confidentiality
agreements with our customers to safeguard customers' proprietary and confidential
information, and require related units to observe confidentiality measures, we havealso established privacy and personal information protection policies that serve as thebasis for compliance management. This includes managing the collection, processing
and use of personal information, and practicing privacy and personal information
protection to ensure the rights and interests of all. Please refer to the Business Ethics
and Compliance section for our Privacy Policy. At the same time, every new employee
must sign the employee code of conduct after reporting to the job, which stipulates
the compliance to recusal due to conflicts of interest, and employees shall not makepublic statements without authorization and disseminate operating information not
yet confirmed by the Company. Regarding customer document management, theCompany stipulates that all customer documents are defined to have the highest levelof confidentiality to protect product information provided by customers. Document
information shall be encrypted and stored in the Company's internal network system.
Information authorization management is adopted to ensure that customer privacy
is tightly protected. For cybersecurity management, the Company also has a setof standard management procedures and training courses, to strictly implement
the cybersecurity policy and customer privacy protection measures and operatein accordance with the policies and plans of the Information Security Committee,
protecting the Company's business secrets and customer information from leaks andcomprehensively enhancing cybersecurity awareness. For related content, pleaserefer to the Cybersecurity Management section. In 2021, there were no incidents of
infringement of customer privacy rights, and no incidents of customer data leakage.

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Customer Health and Safety
USI emphasizes customer satisfaction and safety, so all suppliers must label materials according to our Green Product Specification
Procedure and we set up a mechanism that incorporates customers' demands into the product design. The company's products
and operating system are also in line with international standard requirements and the safety guidelines of countries that its
products are sold to. For example, it adopts stringent rules and uses only the low-pollution, non-toxic raw materials. For productplanning, USI ensures products meets the specifications required by environmental regulations (EU RoHS, REACH, and related
compounds etc.), and then conducts the life cycle assessment and eco-design evaluation. Meanwhile, USI generates eco-profile
in response to EU's Energy-related Products (ErP) Directive (please refer to the Green Product Management section). USI also
developed a Chemicals Management Procedure to assess and prevent risks that may arise whenever we introduce a new chemical
into our production process as detailed in the Occupational Health and Safety section.
As part of product safety, we use the Factory Inspection Mechanism (1) to ensure all manufactured products comply with relevantlaws, regulations, and ordinances internationally and of the sales area. For all electronic system products that have obtained safety
certification, relevant safety warnings and description of correct operations are clearly stated within the user manual, and are
regularly checked by a third-party (ex. UL, TUV, CCC) on a quarterly or annual basis.

USI Products Compliance with Directive in 2021
Percentage of USI Products within the Directive
Green Products
Directive

Intelligent
Connectivity
Solutions

Visual and Specific
Application

Automotive
Electronics andModule Turnkey
Mgmt.

Advanced
Mobile andMiniaturization
Solution

Advanced Low
Cost Module
Manufacturing

EU RoHS

100%

100%

100%

100%

100%

Halogen Free (HF)

15%

77%

0%

100%

100%

CHINA RoHS

100%

100%

100%

100%

100%

Note 1. Factory inspection mechanism: A manufacturing factory that manufactures products which are labeled with safety regulations shall receive factory inspection (to be auditedby an external certification unit) based on the request of a certification issuance unit to ensure that its products conform to safety regulations

For the protection of users, compliance with productsafety regulations is a basic requirement for imported
electronic products around the world. The system products
manufactured by USI must comply with the product safety
regulations of the country of sale or customers and meet
one of the safety regulations in the right table. In addition, inthe early stages of product design, we also consider various
usage scenarios, and take imperfect laws and regulations
into account, and strengthen product safety standards. The
Company shall continue to expand product safety-related
certifications for retail, industrial, and special field applications
related to IoT to provide customers with high-quality, healthand safety-compliant products. In 2021, the Company
established a certification pipeline for product safety-related
certifications for home security (including access control,
home burglary prevention, area burglary prevention, and fire
alarm notification), and conducted an online session to shareknowledge and introduce the certification process at our
Nantou Facility. In 2021, we did not receive any complaints
about products endangering human health and safety, and no
product safety-related violations were found.

USI System Products Compliance with
Safety Regulations in 2021
SafetyRegulations

Percentage of USI Products within
the Regulations
Intelligent
Connectivity
Solutions

Visual and Specific
Application

EN / IEC 60950-1

96%

100%

EN / IEC 62368-1

100%

100%

CNS 14336.1

75%

0%

GB 4943.1

50%

0%

52

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Supply Chain Management
In 2021, the rapid mutation of COVID-19 virus has resulted in the global pandemic continuing
unabated, with extreme climate causing frequent natural disasters in various countries. In theface of unprecedented impacts and challenges, we have joined hands with our global partners
to fight against the global pandemic. To avoid supply chain interruptions and maintain
operational productivity, we conduct regular annual reviews and evaluations of supplierfinancial risks. We would adjust our procurement strategies, find alternative vendors, andprepare backup materials. In 2021, we evaluated 46 suppliers for financial risks.
To build a sustainable supply chain, USI has implemented measures to support local suppliers,
implement human rights and protect labor rights, restrict the use of hazardous substances
and avoid using conflict minerals, as well as adjusting our procurement strategy according
to global industry trends. We have adopted various procurement strategies according to themajor categories of raw materials to diversify our sources of supply to reduce risks and ensurecompetitive pricing, reasonable cost, accurate delivery, and sound quality. In addition, we
also conducted cross-departmental communication and coordination, executed regular auditsof suppliers to ensure sustainable management of the supply chain, and invited suppliers toattend new product and technology presentations to establish solid partnership relationships
with suppliers. In 2021, we held 14 new product and technology presentations with material
suppliers.
In addition, to reduce material costs, prevent material shortages or improve quality, USI
conducts alternative material evaluation programs, and the Procurement Department,
together with the R&D, Manufacturing, and Engineering departments, actively discusses withcustomers in advance about the introduction of alternative materials to avoid supply chain
disruptions. We continue to drive a positive cycle with our supply chain, communicating andcollaborating with each other. For materials with unique characteristics, customized materials,
or materials subject to market supply constraints, we have identified five key material
categories for production and established the following operations for key materials to reduce
the risk of occurrence:

53●

Development of alternative material mechanisms●

Emergency response management measures●

Purchase mechanism from spot dealers●

Material shortage review mechanisms●

Inter-facility transfer and rebalancing mechanisms

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Supplier Code of Conduct
As a responsible corporate citizen, USI takes proactive action to ensure that business practices
meet the highest standards of professionalism and ethics. The supply chain is an important
extension of the business value chain, and we are actively engaged in supply chain development
to ensure that suppliers, contractors, and service providers work together to achieve the goalof sustainable development. Therefore, USI has established a code of conduct for its suppliers
to comply with. In addition to fully complying with the laws and regulations of the countries /regions in which they operate, suppliers are also required to follow set standards for businesspractices in the areas of labor, occupational health and safety, the environment, business ethics,
and management systems. At the same time, suppliers are required to communicate theserequirements to their next-tier suppliers and monitor their respective compliance. USI regularly
sends out annual supplier code of conduct communication letters to ensure that all suppliers
continue to comply with relevant domestic and international regulations, relevant international
standards, and anti-corruption and anti-competitive conduct requirements. Please refer to USI
website for our full Supplier Code of Conduct. (https: // www.usiglobal.com / files / images /supply / Supplier_CoC_EN.pdf)

Supply Chain Strategy
USI fully understands that the overall power of procurement is a unique resource. In order topursue sustainable growth while meeting the needs of our customers, in the Company's daily
procurement operations, in addition to cost and quality considerations, we also evaluate theoverall sustainable value generated by the supply chain, hoping to develop stable partnerships
with suppliers, continuously improve the overall supply chain resilience, grow together with
suppliers, and implement sustainable procurement in concrete terms. Through the development
of different projects such as supply chain diversity and sustainable procurement, we aspire tocreate a win-win future together with our suppliers.

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

USI Suppliers
Supply Chain Management Strategy
Value-Oriented
To obtain a competitive
overall value in the
supply chain.

Responsible
Minerals
Sourcing

Diversified
Sources
To maintain atleast two suppliers
for the samematerial to ensure acontinuous supply.

To ensure that
suppliers are using
only responsibly
sourced, conﬂict-freeminerals in their products.

Sustainable
Sourcing
To raise suppliers'
economic, environmental and social
performance insustainability.

Quality First

Strategic
Cooperation

To obtain the best
quality products
and services
fromsuppliers.

USI products are diverse and can be applied in many sectors. We
mainly procure active / passive components, substrates, mechanicalcomponents, and other peripherals. Our raw material suppliers, spreadthroughout the world, include original manufacturers, agents, and offthe-shelf suppliers. In the face of the ongoing pandemic and global
shortages, in 2021, we traded with over 1,900 material suppliers, anincrease of 200 suppliers compared to 2020, to meet the needs ofexisting and new customers.

Category of Raw Material Suppliers in 2021
14%
Acive

8%

Passive

3%

Mechnical

7%

68%

To integrate suppliers'
resources and capabilities for
greater innovation.

PCB
OthersDistribution of Raw Material Suppliers in 2021 (1)Sustainable Supply Chain Projects
Project

Quantitative / Qualitative Results

Bringing in Second
Sources

To reduce material costs, avert serious material shortages, and replace unsuitable suppliers to optimize
product quality, we strive to establish more than two alternative materials for each material for originalor collaborative design and manufacturing projects to increase flexibility in supply. In 2021, for Customer
Z we have introduced the optional material mechanical components solution, with an estimated annual
volume of 800,000 pieces, and the optional substrates with an estimated annual volume of 530,000
pieces. The two projects are estimated to save approximately CNY 5.12 million annually.

Pallet Recycling andReuse

In cooperation with local suppliers, the Nantou Facility recycled and reused 13,105 plastic pallets and
6,798 wood pallets in 2021, and saved approximately CNY 3.31 million.

Packaging Materials
Recycling

We collaborate with major processing vendors to recycle packaging materials and reduce environmental
damage. In 2021, the Nantou Facility recycled a total of 1.13 million trays, 230,000 partitions, and 60,000
recycling bins, a total of 562.66 metric tonnes of waste were reduced and saved approximately CNY 9.14
million.

18%

Mainland China

1%

41%

14%

TaiwanSoutheast Asia
Northeast Asia
North America

2%

Mexico4%20%EuropeNote 1. The percentages of the amount purchased calculated according to the supplier distribution regions54

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

The proportion of 2021 transactions with suppliers in each facility is shown in the table below. In
this table, Zhangjiang and Jinqiao Facilities mainly manufacture the products for the biggest OEM
customer. The type of material procurement was relatively simple, with the most substantial
proportion of purchase amount. However, Shenzhen and Kunshan Facilities have multiple
production lines with a wide range of material procurement, and the transactions of suppliers
were relatively high.

Number of Suppliers and Percentage of Transaction Amount at All
Facilities in 2021
Zhangjiang

Jinqiao

Shenzhen

KunshanNantouMexicoNo. of Suppliers

429

70

884

829

780

428

Percentage of
the Transaction
Amount

38%

17%

8%

12%

20%

5%

For our six major manufacturing facilities in Zhangjiang, Jinqiao, Shenzhen, Kunshan, Nantou,
and Mexico, we divide them into three regions: Mainland China, Taiwan, and Mexico. The local
sourcing of raw materials suppliers in 2021 is as follows: The average local procurement rategrew to 39% in 2021, based on the average ratio of local procurement to global procurementby those manufacturing facilities. Our strategic procurement department will continue tostrengthen the management of target suppliers and select local vendors with competitive
advantages. We will continue to develop local vendors with competitive advantages and aim to
maintain a local procurement rate of at least 35% worldwide in 2022 to enhance the competitive
advantage of the local industry and strengthen the partnership with suppliers.

SocialInvolvement

Appendix

Percentage of Purchasing from Local Suppliers at All Facilities (1)69%61%

Global43%

22%

USI supports local suppliers. This strategy not only facilitates the growth of the local economy
and increases local employment rates, but also effectively saves energy and time consumed
in transportation, helping us to minimize the impact on our environment. Therefore, our raw
materials are primarily purchased from local or nearby suppliers. In 2021, the proportion of local
raw material supplier purchases in Mainland China increased by 5% due to the introduction of
new projects and changes in key supplier counterparties. In Mexico, in response to customers'
requests for production locations, some of the models originally produced in Mainland China
were transferred to Mexico, resulting in an increase in the number of suppliers in Mexico from309 to 428. It also led to a 7% decrease in the percentage of local procurement in the Mexico
Facility.

55

Inclusive
Workplace42%

38%37%
30%

Facility

Note 1. Procurement amount statistics by all facilities

Environmental Protection
and Occupational Safety

18%

16%

14%

2018

2019

43%
39%
29%

19%
12%

2020

MainlandChina
MexicoTaiwan2021

Authorized Economic Operator
Over the years, the company has strictly complied with the relevant national and international
regulations and attaches great importance to the rights and values of customers. Nantou Facility
passed the Authorized Economic Operator (AEO) certification on October 1, 2021 and wasawarded the certificate by the Taichung Customs. AEO aims to establish a partnership between
customs and enterprises with complete supply chain security measures and certified operators
through AEO certification. It helps to enhance the corporate image and strive for international
trade supply chain cooperation opportunities. Through the AEO certification system, it enhancescargo production management, strengthens corporate risk control mechanisms, and ensures
the provision of secure product distribution services to meet the trend of global trade security
and convenience. When AEO-certified entities process customs clearance for shipments, theycan enjoy preferential measures such as fast clearance, so that products can be shipped out
efficiently. Through the world-class security certification of entity, procedures, cargo, andinformation, it effectively enhances international competitiveness.

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Supplier Evaluation and Regular Assessment
The progress of the suppliers' CSR will be one of the key factors behind USI's prospects.
Therefore, USI establishes a standardized supplier evaluation system and Vendor Rating System
to select suppliers according to the supplier evaluation criteria for protecting human rights andenvironment, as well as providing customers with high-quality products that meet health andsafety requirements. Through continuous and close cooperative relationships with suppliers, asustainable supply chain can be jointly established.
Following the company's demand trends and purchasing strategy of products of the future, USI
establishes the supplier evaluation and approval process to investigate if the productivity, technicalinnovation ability, quality & service management of potential suppliers meet the requirements
and serve as the basis of becoming an official supplier. When evaluating a new supplier, anevaluation team must be formed by purchase, quality, CSR, R&D, and engineering units to
conduct a supplier capability survey for the Quality Review Board to verify the final assessment
result. The supplier evaluation and approval process include basic company information, productinformation, major customers and financial status, the supplier's green control procedure,commitment to green products, supplier quality, and supplier sustainability assessment survey.
For all new suppliers developed by USI, they are required to sign the Certificate of Non-use ofEnvironmentally Hazardous Substances, Conflict Minerals Representation, Supplier Code ofBusiness Integrity, and Supplier's Commitment to Corporate Social Responsibilities to ensurethat they will include the effects of environmental sustainability, social labor and human rights
in the assessment and control. USI will give a corresponding approval level to the supplier after
the evaluation. The relevant results and qualified supplier list can be looked up in PDM system.
In 2021, a total of 34 new suppliers of USI entered the evaluation process, and finally 32 of thempassed the review. The proportion of new suppliers that passed the screening was 94%.
After becoming our qualified supplier, we must regularly assess the supplier's performance. USI
forms an assessment team composed of members from the Supply Chain Management andQuality Assurance Departments and quarterly evaluates suppliers from three aspects: quality,
delivery and communication, and price. According to our Supplier Performance Measurement
Procedure, we divide the evaluation scores into five grades. For Superior suppliers, the company
will give incentives to give priority to obtaining the right to manufacture new products or increase
the order volume. If suppliers do not meet expectations, they will receive Vendor Corrective
Action Report (VCAR) requests for relevant replies and improvement reports. The improvement
plans and results proposed by the suppliers shall be reviewed by the relevant units and audited by
the supplied commodity management department as required. We expect to improve the deliveryof incoming materials, reduce the price of incoming materials, improve the quality of incoming
materials, strengthen communication with suppliers, and continuously improve and find long-termcooperative supplier partners through supplier performance evaluation.

Evaluation Procedure

Supplier Regular Assessment

53

Apply for
Supplier
Evaluation

A+
Superior

D
Replace

2

Ask Supplier
to Fill Out
Questionnaire

4

Evaluate
Veriﬁed Results

6

Determine
Supplier
Viability

Quality

Performance
績效考核
Measurement

Price

A
lent
Excel

Follow up on
Corrective
Actions andClose Case

Conduct
On-site Audit

able

1

Delivery &Communication
Ob
le
se
ab
r
pt
e
C ved
c B
Ac

56

Operation and
Governance

About this Report

Sustainability
Management

Green Products
and Innovation

Environmental Protection
and Occupational Safety

Value Chain
Management

Inclusive
WorkplaceSocialInvolvement

Appendix

Supplier Sustainability Risk Assessment
USI abides by and uses the RBA Code of Conduct to audit our suppliers. Our RBA audit team is formed by members from our Human
Resources Department and EHS Department and assesses suppliers in five dimensions: labor, health and safety, environment,
ethics, and management systems. The assessment highlights labor rights protection, workplace safety, environmental management,
and anti-corruption. To ensure suppliers' compliance with corporate social responsibilities and enhance their competitiveness werequest suppliers to uphold human rights, ensure the rights and benefits of their employees, and advance their companies' social
performances.

Sustainability Risk Assessment Procedure

1

5

Review the
suppliers' SSAQ

Suppliers f illout SSAQ

Select suppliers

Conduct on-site
audit for high-risk
suppliers

4

3

2

Suppliers sign theletter ofcommitment topromise to follow
RBA Code of
Conduct

6

Suppliers make
improvement
based ondeﬁciencies

7

Conf irm
improvement
results

Tier 1
Suppliers
Material suppliers(including directmaterials, indirect materials,
and packaging materials) that
we have traded with for two
consecutive years and have an annual
purchase amount exceeding USD 200,000

Critical Tier 1 Suppliers

8

Case closed

To implement effective supplier management, the Company screens Tier 1 suppliers for control through annual procurement
amounts and identification of Critical Tier 1 Suppliers as the basis for focused management. The Company conducts risk assessmentsof suppliers through the Supplier Sustainability Assessment Questionnaire (SSAQ) to ensure that risks can be effectively controlled
and reduced. We also identify suppliers with potentially high governance, environmental and social risks, and conduct on-site auditsof suppliers with potentially higher risks to gain an in-depth understanding of the current status of supplier sustainability.
In 2021, we conducted an SSAQ survey for 419 Tier 1 suppliers, with a response rate of 73%. According to supplier replies, we
review and assess the suppliers with high risk and conduct on-site audits. Due to the COVID-19 pandemic, we imposed stringent
travel restrictions to protect all employees. Therefore, in 2021, document audits and online audits of 47 material suppliers wereconducted. In addition, On-site audit of 36 on-site service contractors. Audit results are 100% low-risk. For the deficiencies found in
the audit, the suppliers were required to propose an improvement plan, and to complete the improvement within the deadline. The
improvement plan was also revisited by us, with the supplier required to have a 100% completion rate of improvement items after
the review. We analyzed the deficiency items in supplier audits and found that of the five major areas 45% were labor-oriented. The
detailed results are shown in the chart below. In 2022, we will continue to focus on labor-oriented improvements through counselingand advisory measures. For suppliers that we had not terminated relationships with in 2021 after evaluation, we will continue toassist suppliers with the goal of complying with the RBA Code of Conduct and contribute to the improvement and enhancement of
the supply chain business environment together with suppliers.

57

Supplier Definition

Top 85% of direct material procurement amountIndirect and packaging material suppliers with aprocurement amount of more than USD 1 million
Preferred supplier: Proposed by procurement unit, approved by
the Business, Supplier Quality Engineering, and R&D Unit

Distribution of Critical and Non-Critical
Suppliers in 2021 (1)92%
8%Critical Supplier

Non-Critical Supplier

Note 1. Statistics by annual purchase amount of suppliersAbout this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Supplier Audit Deficiencies and Improvement Actions in 2021 (1)Category

Labor

Health and
SafetyEthicsManagement
SystemRBA
Classification

Major Nonconformance
Finding

Wages andBenefits

Reduction of salary as adisciplinary action
Failure to revise salary
management related
documents in a timely
mannerRevision of performance
evaluation and bonus
adjustment system as
disciplinary action
Revision of the company'ssalary management-related
regulatory documents

Enforced payment for work
uniforms and other items
when employees resign
Failure to declare that
employees are allowed to havefree association and assembly

The cost of work uniforms isborne by the company, andthe relevant provisions weredeletedAmendment of company
documents

Young Workers

No management system toprohibit the use of child labor

Establishing regulations
prohibiting the use of childlabor and remedial measures
after the misuse of child labor

HumaneTreatment

No in-depth understandingof the specific content of
humane treatment in the RBA
Code of Conduct

Adding sexual harassment
and sexual assault to therelevant management
regulations

Occupational
SafetyOccupational hazards noticesigns not posted at sites
with potential occupational
hazards

Posting occupational hazard
notification cards

Occupational
Injury and Illness

Failure to establish
management procedures forprevention of work-related
injuries and occupational
diseases

Develop management
procedures for handling
occupational accidents andpreventing occupational

Business Integrity

Failure to establish an anticorruption policy for businessintegrity

Establish a management
system for business integrity

Protection of
Identity and NonRetaliation

Failure to establish policies /procedures to protect theidentity of employees andsupplier whistle

Develop a complaint
reporting and whistleblower
management system

Privacy

Failure to establish a policy orsystem to protect the privacyof customers and employees
Failure to establish regulatory
identification procedures

Freely Chosen
Employment

Legal andCustomerRequirements

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Distribution of Supplier Sustainability Audit Findings

Corrective Action

23%
Labor

22%

Health and Safety
Ethics45%
10%Management System

In addition, the results of the human rights risk assessment of suppliers in 2021 found that
"Wages and Benefits, Freely Chosen Employment, Occupational Safety, Occupational Injury andIllness" were the main human rights risk issues. We identify suppliers that were likely to facehigh risks and take corresponding measures to continuously track the effectiveness of theirdifferent risk profiles and ensuing improvement plans.

Supplier Human Rights Incident Mitigation and Compensation Measures
Category

Labor

Health and Safety

Risk Issue

Wages and Benefits
Freely Chosen Employment

Occupational Safety
Occupational Injury and Illness

Mitigation
MeasureAnnual audits or RBA VAP to assess suppliers' human rights risks through eachfacility to mitigate risks.
Requiring suppliers to adopt corrective measures for human rights risks andconduct follow-up on implementation.

Compensation
MeasureEstablish a policy or systemfor protecting the privacy of
customers and employees

Requiring suppliers to provide guidance or compensation, or to implement
policy changes or other measures for employees whose human rights have been
violated.
If a high-risk vendor is identified, the Company shall conduct on-site audits andprovide recommendations for improvement and require the vendor to submit
improvement reports on a regular basis to track the performance of continuous
improvement.

Appeal Channel

Establish regulatory
identification procedures

The grievance mechanism for external whistleblowing: for details please refer tothe Business Ethics and Compliance section.

Note 1. Identify the top 3 RBA classification audit deficiencies in each category58

About this Report

Operation and
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Management

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and Innovation

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Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Supplier Communication
Good communication channels and frequent interactions
with our suppliers build solid relationships. For this, weestablished a supplier evaluation team with members fromour Quality, Engineering, and Procurement units to handle
supplier communication. We invite suppliers to attend USI'squarterly Executive Business Review (EBR), where we share
our views on future market trends and experiences. We also
take the chance to promote our environmental health andsafety policies, focusing on their role in our green supply
chain. We reiterate the importance of social responsibility
and sustainability by updating them with the latest hazardous
substance restrictions, environmental regulations, andcustomer product quality requirements. In 2021, USI and ourmaterial suppliers held 24 EBR meetings.
In addition to quarterly meetings, USI regularly holds courses
to communicate with suppliers on market dynamics. We will
host webinars for suppliers in light of new regulations to let
the entire supply chain learn about the latest information
and upcoming changes. Suppliers then can prepare andcomply with USI's requirements regarding green procurement
standards such as WEEE, RoHS, REACH, and Conflict Minerals.
We expect our suppliers to value corporate ethics, enforce
anti-corruption practices, and uphold our Supplier Codeof Business Integrity. To monitor this, USI has a dedicatedwhistleblower mailbox (Please see the Business Ethics andCompliance section) for all to report any violations in ourbusiness practices with our supplier partners. In 2021, there
were no cases where the suppliers provided feedback or madecomplaints.

Sustainable Supply Chain Webinar
The Sustainable Value Chain Webinar is an annual event
held by the Company for its suppliers. In 2021, theGlobal Sustainable Supply Chain Webinar for the Greater
China region was held at the Nantou Facility. The event

59

promoted USI's philosophy and implementation policies, and communicated directly with suppliers around the world, including
the continuous implementation of green supply chain in line with international trends for environmental protection, and thesharing of our requirements, implementation experience, and future goals for suppliers' ESG. At the same time, we invited
Senior Product Manager, Kyle Lu from SGS Taiwan to share "Net Zero Carbon Emission Trend and Response", which explainedthat in the upcoming battle against climate change, enterprises should have the correct concept of carbon management whenfacing the goal of carbon reduction, emission reduction, and even achieving net-zero emissions, and gradually carry out carbon
inventory calculation as the basis for setting up carbon sustainability management. Through information disclosure, companies
can improve the effectiveness of corporate governance, effectively enhance their corporate image, and gain the credibility of
stakeholders to achieve the win-win sustainability goal of environment, society, and governance. A total of 276 supplier partners
attended this online sharing conference, and 155 questionnaires were recovered after the session, with USI rated as "verysatisfied".

Supplier Feedback"The webinar provided insight into the industry and global trends""Webinars are a great way to learn without being limited by location"

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Conflict Minerals
ComplianceUgandaDemocratic
Repulic of theCongo (DRC)

AngolaZambiaInclusive
WorkplaceSocialInvolvement

Appendix

Item

Management Approach

2021 Performance

Management
SystemEstablish procedures governing
conflict minerals according toregulations and customers'
requirements
Make corporate policy for sourcing
conflict minerals
All suppliers must comply with ourconflict-free minerals procurement
policyConduct relevant personnel
trainings

Complete Conflict Minerals Management Process information, please refer tohttps: // www.usiglobal.com /en /csr / Conflict-Minerals-Compliance
Complete Conflict Minerals procurement policy information, please refer
to https://www.usiglobal.com/files/images/csr/2020/Conflict_Minerals_
Management/USI_Conflict_Minerals_Policy_EN.pdf
All our targeted suppliers (2) comply with our conflict-free minerals policy
Opened a "Conflict Minerals Management" online training course. This course
is required for all personnel engaging in relevant affairs. In 2021, 73 employees
completed the training

Due Diligence(DD)

Investigate smelters materials areprocured from (3)Conduct suppliers / materials risk
assessment
Risk Identification
Identify new materials

The materials used by USI's suppliers come from qualified smelters. The use of
3TG smelters and cobalt smelters in 2021 is as follows and the distribution inrecent years is shown on the following page
Risk Identification and Mitigation Plan: Continued Trading for Mitigable Risks,
Suspension of Trading during Mitigation Periods, Termination of Trading for NonMitigable Risks, Management Process as shown on the following page

Supplier
Management

Make corporate policy for sourcing
conflict minerals
Require suppliers to use qualified
smelters
Conduct supplier on-site audits andcounseling
Encourage unqualified smelters towork with RMI
Promote relevant requirements
and plans through sustainablesuppliers' briefings

USI continues to promote the procurement of conflict-free minerals to the
supply chain, and expanded supply chain due diligence. In 2021, a total of 416
suppliers completed the CMRT (4) survey. The situation over the years is shown on
the following page. In addition, we completed the CRT (5) survey of 150 suppliers
Written and online interviews with a total of 15 suppliers
Announced USI's requirements and future direction at the 2021 Sustainable
Supply Chain Webinar

Independent
Private Sector
Audit

Carry out third-party audits andmeet the annual conflict-freemineral declaration
Abide and comply with customer
conflict mineral audit requirements

USI's parent company, ASEH, is required to report annually to the SEC (6) and therelated conflict minerals reports have been audited by IPSA (7)The IPSA is conducted on the results of due diligence, and our target suppliers
use 100% qualified smelters

Annual ReportCompile annual conflict mineralreportProvide CMRT requirements to thecustomers

ASEH's annual conflict minerals report covers USI and its subsidiaries, the scopeof the report is on the first page and can be accessed at: https://www.usiglobal.
com/files/images/csr/2021/Conflict_Minerals_Management/2021_cm_report.
pdf
Provide a complete conflict mineral report form in accordance with customer
requirements

Sudan

Congo Republic

Environmental Protection
and Occupational Safety

Conflict Minerals Management

Conflict minerals are metals such as tantalum, tin, tungsten,gold, and cobalt that are illegally mined and traded fromthe Democratic Republic of the Congo and its neighboring
countries (1). These metals were obtained by local armed
militias through long-term violent coercion of labor or childlabor to destroy the environment and ecology, and they arealso the main source of funding for illegal armed organizations.
ASEH joined RMI (Responsible Minerals Initiative) in 2015. Asa member of ASEH, USI utilizes the resources and guidance
provided by RMI to make wise choices in the supply chain
regarding conflict minerals, achieving a conflict-free mineral
supply chain.

Central African
Republic

Value Chain
Management

RwandaBurundiTanzania

Note 1. The neighboring countries: Central African Republic, Republic of the Congo, Angola, Zambia,
Tanzania, Burundi, Rwanda, Uganda, and South Sudan
2. Target supplier, annual 92% of the total purchase amount
3. USI requests suppliers to source minerals from RMI approved qualified refining plants(https: //www.responsiblemineralsinitiative.org / smelters-refiners-lists / )4. CMRT, Conflict Minerals Reporting Template
5. CRT, Cobalt Reporting Template
6. SEC, United States Securities and Exchange Commission
7. IPSA, Independent Private Sector Audit

60

Operation and
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Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Number of Qualified Smelters 3TG and Cobalt

Gold

Tantalum
1
40
2018

40
2019

2

2

77

2020

73

39
2021

2018

2019

2020

55

41

2021

2018

2

2

6

43

45

42

2019

2020

110
101

104

Supplier Provides/
Updates CMRTAppendix

Cobalt

6

52

64

109

2021

2018

2019

Conformant
15

12

11
2
2020

2021

9

2019

2020

22

ActiveNon-Participating

2021

Number of Qualified Suppliers

Risk Identification Management Process

3TG Parts

SocialInvolvement38

Tungsten

12

73
39

1

3

Tin

1

Inclusive
Workplace

Identify
Smelter
Risks

Qualiﬁed Smelter

Case Closed

379

List High Risk Suppliersand Evaluate toContinue Trading

2018

416
352

359

2019

2020

Non-Qualiﬁed Smelter

Yes
Risk Mitigation
EﬀortsRisk
Mitigation
Options

No
Risk Mitigation
Non-Feasible

2021

Conflict Minerals Commitment and Future Plans
With the resources and guidance provided by RMI and Organization for Economic Co-operation
and Development (OECD), USI has started the supply chain conflict minerals response measuresby requiring suppliers to refer to the criteria of procurement from RMI's qualified smelter list,
to achieve USI's commitment and future plans for a conflict-free minerals supply chain. The
measures taken are as follows:
1. Establish a conflict-free supplier procurement policy and communicate USI's management andinvestigation requirements through supplier conferences.

61

2. Carry out an annual survey to evaluate suppliers' purchase or use of smelters, and immediately
request removal if found to be unqualified.
3. Analyze and identify suppliers' smelter risks, continue to conduct supplier on-site visits, andguide suppliers to establish management mechanisms.
4. Optimize supplier management system to improve the management of smelter information
quality, while achieving customers' reporting requirements.
5. Set up a plan to investigate the sources of cobalt and mica to meet RMI and RMAP (Responsible
Minerals Assurance Process) standards.

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Environmental Protection and Occupational Safety
With an emphasis on environmental protection, USI takes aggressive measures against climate change. We look forward to considering environmental protection as well as
achieving environmental sustainability while pursuing high quality products and services. In addition, we are committed to promoting a culture of occupational safety and healthand providing a quality working environment for our employees.

100
93
1,508
26
410
0
83
13,098% Renewable Energy Use in Mainland China Facilities% Non-hazardous Waste Recovery Rate
MWh Renewable Energy Produced through Solar Panels

CNY

Million Invested in Environmental Conservation

Occupational Health & Safety Trainings

Case Contractor Occupational Injuries% Employees Fully Vaccinated Against COVID-19
People Attended Health Promotion Activities

62

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Key Performance and Targets
SDGs

Business Action

Formulate health andsafety policies creatinga work environment
where all workers
can be fulfilled whileworking

2021 Key Issue

Occupational Health& Safety

EnergyManagement

Establish
environmental
objectives, include
them in the businessstrategy, and review
the performance
annually

Conduct an inventoryof carbon emissions
and implement carbon
reduction projects

Water Resource
Management

KPI

2021 Target

2021 Performance

Major occupational
disease incidences
Major occupational
injury incidences
Major infectious
disease incidences

Maintain ISO
45001 certification
No majoroccupational
diseases
No majoroccupational
injuries
No major
infectious diseases

StatusAppendix

Not Achieved (1)2022 Target

2026 Target

Maintained ISO
45001 certificationin all facilities
No cases ofoccupational diseaseNo major cases ofoccupational injuries
No major cases ofinfectious diseases

Maintain ISO 45001
certification
No majoroccupational
diseases
No majoroccupational
injuries
No major infectious
diseases

Obtain / maintain
ISO 45001
certification
No majoroccupational
diseases
No majoroccupational
injuries
No major infectious
diseases

Electricity intensity

Electricity intensity
decreases by 6%from baseline year
2015

Electricity intensity
decreased by 23.4%
from baseline year
2015

Electricity intensity
decreases by 7%from baseline year
2015

Electricity intensity
decreases by 11%
from baseline year
2015

Water intensity

Water use intensity
decreases by 6%from baseline year
2015

Water use intensity
decreased by 36.4%
from baseline year
2015

The water use
intensity decreases
by 7% frombaseline year 2015

The water use
intensity decreases
by 11% frombaseline year 2015

Hazardous waste
generation intensity

Hazardous waste
generation
intensity decreases
by 5% frombaseline year 2015

Hazardous waste
generation intensity
increased by 14.7%
from baseline year
2015

Hazardous waste
generation intensity
decreases by 7%from baseline year
2015

Hazardous waste
generation intensity
decreases by 11%
from baseline year
2015

Non-hazardous
waste recovery rate

Non-hazardous
waste recovery
rate recycling rate
reaches 90%

Non-hazardous
waste recovery
rate recycling rate
reached 93%

Non-hazardous
waste recovery
rate recycling rate
reaches 90%

Non-hazardous
waste recovery
rate recycling rate
reaches 90%

Obtain ISO
14064-1:2018
certification

Obtain ISO
14064-1:2018
certification

Obtain ISO
14064-1:2018
certification

Maintain ISO
14064-1:2018
certification in all
major facilities

Obtain / maintain
ISO 14064-1:2018
certification in all
major facilities

Note 1. For unachieved targets, please refer to the corresponding sections for relevant explanations and future improvement plans

63

SocialInvolvement

Achieved

Waste andRecycling

Climate Change

Inclusive
WorkplaceAbout this Report

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Governance

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Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Climate Change and Carbon Management
USI integrates the concept of ecologically sustainable development with company's managerial
decision-making and operation management. The board of directors and the executives assume
management responsibility and take the opinions of stakeholders as reference to formulate
the corresponding management strategy. Through the continuous promotion of management
systems ISO 14001, ISO 50001, and ISO 14064-1:2018 (please refer to the Management Systems
Certification Table), we have improved and reduced environmental impact of our operations andhereby make a public disclosure about USI's environmental information for the implementationof corporate environmental responsibility.
Our Environment, Health, Safety, and Energy Policy (EHS & Energy Policy) follows the principleof Regulatory Compliance & Responding to Environmental Campaigns to optimize resource
utilization, and create an eco-friendly, healthy, and safe working environment. Please refer to
USI website for the complete EHS & Energy Policy. A telephone hotline and mailbox are provided
for feedback from stakeholders. In 2021, no official complaint about environmental impact
was received, and no violation against environmental regulations and environmental pollution
incidents. There are no significant environmental or ecological related fines or penalties (1) within
4 years.
The global warming caused by greenhouse gas emissions over the years has exposed the world
economy to significant risks and has threatened many businesses around the world. As aresult, stakeholders are starting to focus on risks and opportunities due to climate change. The
Financial Stability Board (FSB) published the Task Force on Climate-related Financial Disclosures(TCFD) Framework in June 2017. The framework provides a clear picture of how to address therisks and opportunities associated with climate change and gives companies and investors acomprehensive assessment framework that can also be reflected in financial reporting.

Task Force on Climate-related Financial
Disclosures (TCFD)
In response to international initiatives and our Low-Carbon Strategy, USI adopted the TCFD
framework and discloses the risks and opportunities brought by climate change, demonstrating
corporate responsibility and strategy to allocate capital more reasonably and effectively toachieve the vision of low carbon economic transformation.
●●

The USI Sustainability Committee, thehighest organizational unit to manage
the Group's sustainable development,
annually prepares an ESG report that
includes climate change-related
issues for the Board of
Directors' review

Governance●

Strategy

Identify short,medium, and long-termclimate change risks andopportunities● Assess risks and opportunities based on
diﬀerent climate scenarios

Climate risk is incorporated into theEnterprise Risk Management (ERM)
management process● Collaborate across departments to
identify climate-related risks / opportunities along the value chain, assess
ﬁnancial impacts and develop
countermeasures to manage
Riskthem using Mitigation andManagement
Adaptation methods

Metrics
andTargets●

Set climate-related
performance indicators andquantitative targets; regularly trackprogress, and disclose to the public
without concealing information●

Set a long-term goal for Net-Zero
Carbon Emissions in 2050

Note 1. Major fines or penalties refer to a fine of more than CNY 65,00064About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Inclusive
Workplace

Environmental Protection
and Occupational Safety

Climate Change Risk and Opportunity Management Process

Climate Change Risk and Opportunity Matrix

Background Data Collection

High

SocialInvolvement

Appendix●

Financial Impact Severity

Collect background and scenario data from news, internet, othercountries or company events● Consider the transition risks (policy and law/ market/technology/
reputation), the physical risks (chronic and acute) and the opportunities(resource eﬃciency, energy, products and services, markets andadaptation)

Risk /Opportunity Possibility Analysis●

To analyze the targets in the value chain that are being aﬀected(including direct operations, supply chain or customers)● Impact duration (now within 0 to 1 year, short-term 1 to 3 years,
medium-term 4 to 10 years and long-term 11 to 30 years)● Possibility (almost sure, highly possible, possible, unlikely, and extremely unlikely)

Financial Impact Analysis●

Use impact on monthly revenue as an indicator (The indicator levels
are divided into 1 to 5, with the ﬁfth level having the highest impact)

6

7

5

Low Risk / Opportunity

1 2
3
8 9

Moderate Risk / Opportunity
High Risk / Opportunity

Risk Assessment

Low

4

Risk Probability

High

●

Evaluate risk / opportunity indices based on the possibility and ﬁnancial
impact scales● According to the risk /opportunity indices, it is classiﬁed as★
★
★

Red: High risk /opportunity (for immediate action)
Blue: Moderate risk /opportunity
Green: Low risk /opportunity

Control Mechanism●

65

Review the existing control mechanism and set feasible control
indicators

Opportunities

Transition Risks

Physical Risks

6 Develop energy saving components

3 Energy Transition

1 Drought (Supply Chain)

7 Demand for electric cars market

5 International carbon tax
and emission quota
requirements

2 Floods (Supply Chain)

8 Introduce an energy management
system to improve energy eﬃciency

4 Customer demand forgreen products

9 Drought (USI)About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

The Financial Impact from Risk and Opportunity
Risk and
Opportunity Types

Description of Risks andOpportunities
Energy Transition

Customer demand for green
products

Potential Financial Impact
Increase in energy costs

Improve equipment efficiency, upgrade the power supply and replace power systems
Organize regular sessions of successful power saving case studies with related taskforces

Additional carbon reduction equipment
installation and R&D costs

We have developed biodegradable plastics (emission reduction) that fit the customers' needs based on
climate change issues to facilitate the energy-saving and carbon-reducing product applications for ourcustomers
We absorb cutting-edge knowledge through papers, seminars, and exhibitions to effectively meet customers'
requirements for Energy Star and CoC Tier 2

Additional operating costs

We propose to introduce eco-friendly materials in the early stage of product development, which caneffectively reduce carbon emission in line with customers' product development plan for carbon neutral
products
We have developed a carbon supply chain management plan that will allow us to understand the carbon
emissions from our supply chain in the future
We have adopted green power gradually to minimize the impact of carbon pricing

Transition Risks

International carbon tax andemission quota requirements

Physical Risks

Transition
Opportunities

Drought (Supply Chain)
Floods (Supply Chain)Countermeasures

The production was adversely influenced,
resulting in financial losses and revenue
declineEstablish a substitute mechanism for materials
Purchase mechanism for spot dealers
Implement cross-site material transfer mechanism
Provide market information to prepare materials in advance (MPA)
When an emergency occurs that causes a lack of material, the emergency response management procedures
will be activated according to the SOP

Drought (USI)

Simulate flood and drought risks using physical scenarios of climate change and propose contingency
preventive measures

Develop energy saving
components

We can reduce the material and energy consumption by increasing the output per material unit through theminiaturization design; in addition, the energy consumption required for transportation is lower than that ofother products
We can meet the design requirements such as ERP, CEC, and DoE for different types of products to improve
the overall power efficiency in the system

To meet customers' energy-saving productneeds; therefore, we can increase therevenues

Demand for electric cars
marketIntroduce an energy
management system toimprove energy efficiency

Reduce electricity cost for operation

We have developed a series of flip-chip PEC (1) to meet the high current density requirements of headlights,
focusing on LED chip life, reliability, and brightness for Car Lights
For the Powertrain, we continue to design and promote low energy consumption and high efficiency products
to our customers. We also design and develop products to meet the IATF 16949 requirements
We can identify primary energy consumption areas through our ISO 50001 energy management system,
formulate energy-saving plans, and control our energy performance to effectively save energy and reducecarbon emissions through the PDCA Cycle every year

Note 1. PEC, Pad Extension Chip

66

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Carbon Management
Metrics and Targets Related to Climate Change●Managecarbon emissions
and improveenergyeﬃciency

35% reduction in absolute GHG Category 1 &Category 2 emissions in 2030 (base year: 2016,
2.5% reduction per year)● 15% reduction in absolute GHG Category 3
emissions in 2030 (base year: 2020, 1.5%
reduction per year)

Increase theuse of renewableenergyR&D for low
carbon products●●

85% Renewable energy use in 2025
● 100% Renewable energy use inoperational processes by 2035

Increase R&D expenses for low-carbon
products and continue to increase the ratioof energy-saving beneﬁts and revenue forlow-carbon products

According to the analysis of the Climate Change Risk and Opportunity Matrix, there are threetransition risks, three physical risks and three transformation opportunities, among which thehigh risk of USI is the demand for green products from customers. We announced our goal ofachieving net zero carbon emissions by 2050 and continues to implement climate change andenergy management, water management, waste management and air pollution prevention to
help customers produce energy-saving and carbon-reducing products. For the first time, we arepresenting our efforts and results in response to climate change through a systematic disclosure
framework, further raising awareness of climate crisis, formulating relevant mitigation plans
and measures, accelerating the implementation of risk control and climate change mitigation
actions, strengthening our operating sustainability management capabilities, and moving
towards sustainable corporate development. For more details, please refer to Sustainability Data
- Environmental A. TCFD Framework Response.

67

USI continues launch greenhouse gas reduction policy. The greenhouse gas (GHG) emissions
inventory was performed in 2007 according to ISO 14064-1. Another check was conducted in2010 on our worldwide production bases and the results were verified by a third-party institution
to establish USI inventory benchmark data. Since the initial inventory of GHG emissions Category
3 of Nantou Facility in 2018, we fully inventoried Mainland China Facilities the next year. In
2020, a more comprehensive and in-depth inventory was conducted. In 2017, we also started to
conduct product carbon footprint inventory; and disclosed relevant information in compliancewith international regulations, initiatives, and customers' requirements. USI collaborates with
ASEH on the Carbon Disclosure Project (CDP) and conducts annual inventory surveys. For
detailed information, please refer to the 2021 ASEH ESG Report.
Climate change has impacted USI operations. Our Mainland China Facilities are using 100%
renewable energy, while the Mexico Facility used 31% of its annual electricity consumption(I-REC, please refer to the Renewable Energy section for details). In addition, Zhangjiang Facility
and Shenzhen Facility have also initiated carbon quota management in accordance with local
regulations. Cap and trade system for GHG and possible energy or carbon taxes are issues
USI is always paying attention to. In addition to the continuous efforts in energy efficiency
improvement, the promotion of Green Promise and the environmental protection measures ofwill be in facilities to minimize risks from climate change.

Greenhouse Gas Emissions
USI's total GHG emissions in 2021 were 206,131.55 metric tonnes of CO2e (Category 1 &Category 2), an increase of 15,103.32 metric tonnes of CO2e from 2020, and our GHG emissions
intensity was 4.13 metric tonnes of CO2e, an increase of 0.11 metric tonnes of CO2e from 2020.
According to our analysis, in 2021, our operation expansion and continuous production capacity
growth increased our revenue. However, due to the exchange rate loss from USD to CNY, ourGHG emissions intensity increased. Calculated in USD, our GHG emissions intensity would be
26.63 metric tonnes of CO2e, 1.12 metric tonnes of CO2e less than in 2020. The analysis is shownin the following figure:Operation and
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Sustainability
Management

Green Products
and Innovation

Value Chain
Management

The Ratio of Category 1 to Category 2 Greenhouse Gas Emissions (1~6)

Indirect Greenhouse Gas Emissions (7)Category 1
2.2%

Mobile Burning
Emission
0.1%

Fixed Burning Emission
1.0%

Category 3

Greenhouse Gas Emissions and Intensity
6.24
5.31
4.48

4.85
4.02

4.13

142,043.16

149,881.38

148,201.93

168,730.49

184,225.84

201,538.85

8,017.46

8,057.25

7,853.69

7,024.93

8,438.83

6,802.39

4,592.71

2015

2016

2017

2018

2019

2020

2021

GHG Emissions-Category 1 (metric tonnes CO2e)
GHG Intensity (metric tonnes CO2e / M CNY)

GHG Emissions-Category 2 (metric tonnes CO2e)

Description

Appendix

Unit: metric tonnes CO2e

Greenhouse Gas
EmissionsIndirect greenhouse gas emissions fromtransportation

103,140.41

Emissions from upstream transportation anddistribution of goods

48,016.13

Emissions from downstream transportation anddistribution of goods

44,545.17

Emissions from employee commuting

10,364.53

Emissions from business travel

Category 4

151,993.76

SocialInvolvement

Indirect Greenhouse Gas Emissions

Category

5.86

Inclusive
Workplace

USI continued to promote the greenhouse gas inspection (ISO 14064-1). Following the
introduction of the Category 3 inspection at Nantou Facility in 2018, beginning in 2020, we
conducted inventory and identification of Category 3 to Category 6 emissions on the value chain.
In 2021, the verification results by the third-party verification unit are as follows:

Fugitive Emission
1.1%

Category 2
97.8%

Environmental Protection
and Occupational Safety

214.58Indirect greenhouse gas emissions fromproducts used by the organization

12,877,738.29

Emissions from goods purchased

12,843,600.91

Emissions from capital goods

30,571.58

Emissions from solid and liquid waste treatment

1,230.79

Emissions from the use of assets

2,335.01

Total

12,980,878.70

Note 1. The data presented came from the ISO 14064-1:2018 inventory results
2. The data organization boundary is summarized by the operation control method
3. The significant threshold is set at 3%, and the substantial threshold is set at 5%
4. The greenhouse gas emission includes various categories such as CO2, CH4, N2O, HFCs, PFCs, NF3, and SF6
5. GWP value adopts the IPCC Fifth Assessment Report (2013)
6. Due to the revision of the calculation formula of GHG emissions in 2020, the value of Category 1 is revised
7. The data presented came from the ISO 14064-1:2018 inventory results, rounded to the 2nd decimal place68About this Report

Operation and
Governance

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Management

Green Products
and Innovation

Value Chain
Management

Energy Management

Inclusive
Workplace

Environmental Protection
and Occupational Safety

Appendix

Energy Intensity

In the green-house gas emissions, power loss shares about 97.8% in USI. The key to reducing
carbon emission is to save power, making maximum efforts for electricity efficiency. To reduceenergy consumption during the operational activities and product processes and save the cost,the external power supply unit with low energy consumption will be selected in priority when
the products are designed, as well as the tests will be evaluated to ensure the products canmeet the requirements of environmental protection. The different energy-saving improvement
plans will be executed for air conditionings, lighting equipment and heavy-energy consumption
facilities in all facilities as well, continuously reducing the energy consumption and saving theelectricity bill, such as variable-frequency control, seasonable adjustment of air-conditioning
temperature, replacement of old equipment, monitoring and management of electricity bill.
The total energy consumption of USI in 2021 was 986,633.2 gigajoules, an increase of 37,706.9
gigajoules from 2020. Based on the turnover, the energy consumption per million CNY in 2021
decreased by 0.002 gigajoules. In terms of energy saving, there were 10 major energy-saving
schemes, which saved a total of 1,944 MWh of electricity and reduced carbon dioxide emissions
by 1,175 metric tonnes. The total investment is CNY 10,299,102, and the annual cost saving is
CNY 1,653,485. The detailed results are shown in the following chart:

31.3

29.1

26.1

25.5

22.0

776,645.71

731,386.15

758,413.08

738,890.36

2015

2016

2017

2018

Energy Consumption (GJ)

Energy Consumption (1~3)

20.6

20.6

878,276.21

948,926.31

986,633.19

2019

2020

2021

Energy Intensity (GJ / M CNY)
Unit: GJ

Direct Energy Consumption

Category

Indirect Energy Consumption

Total Energy Consumption

DieselGasoline

Natural Gas

Electricity

2021

1,335.80

2,575.20

34,238.98

948,483.21

986,633.19

2020

1,393.59

2,523.89

74,103.64

870,905.19

948,926.31

2019

1,065.38

3,572.89

103,881.07

769,756.87

878,276.21

2018

639.084,011.47

76,708.71

657,531.10

738,890.36

Note 1. The data presented came from the ISO 14064-1:2018 inventory results, rounded to the 2nd decimal place
2. The data includes Zhangjiang, Jinqiao, Shenzhen, Kunshan, Nantou Facilities
3. Conversion data of the heat value index:• Facilities in Zhangjiang, Jinqiao and Kunshan have adopted Annex A (referential energy conversion standard coal factors) of General Principles for Calculation of the Comprehensive Energy Consumption (GB/T 2589-2008)• The Shenzhen Facility adopted Table E.2 (Fossil Fuel Combustion Emission Factors) of the Organizational Guidelines for Greenhouse Gas Emissions and Reporting (SZDB/Z 69-2018)• Nantou Facility have adopted "Heat Content of Energy Products" from Taiwan Energy Statistics Handbook (2020)69

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Description

Power Saving CO2 Reduction(1~2)

Appendix

USI actively responds to the call for renewable energy use. We
purchased 222,319 MWh International REC (I-REC, the registration
authority is I-REC Registry) in 2022 to offset CO2 emitted by traditional
power in 2021 (the annual electricity use for Zhangjiang, Jinqiao,
Shenzhen, Kunshan Facilities were all offset, and 31% of Mexico
Facility's electricity was offset). Low-carbon products produced in
facilities using renewable energy accounts for 69.93% of USI's annual
revenue. According to GHG Protocol Scope 2 Guidance, the statements
are used to neutralize Category 2 Market-based emissions. The
greenhouse gas emissions amount by location and market (3) are as
follows:

Facility

Project

Zhangjiang

Heat recovery
systemimprovement

The high temperature generated from the operationof the air compressor is effectively converted toprovide air conditioning for the facility, reducing thedemand for operating the water-cooled chiller unit

45.1

35.7

Kunshan

Improvement ofwater-cooled chiller
unit

Replacement of old water pumps with energyefficient pumps for the water-cooled chiller unit

640.1

507.1

B1 Ice watermachinereplacement

Added two new Centrifugal Water Chiller Unit
500RT to replace the old six original 300RT Water
Chiller Units (two retired, four for backup use)

813.7

408.5

Exhaust fan motor
replacement

1. The original 15HP old motor is replaced by
IE3 / 10HP high efficiency motor
2. The original 16.5kW motor was replaced with a
new 16.13kW motor to improve efficiency

34.3

17.2

Category

Adjustments of aircompressor supply
pressure

Adjusted the effective air pressure from 7kg / cm2 to
6.5kg / cm2

5.3

2.6

Air compressor
with variablefrequency drive

Equipped with a variable frequency drive tosave energy and lower the load operation andautomatically load the backup unit when the airpressure is insufficient to prevent the production
line from being interrupted due to loss of pressure

Locationbased

53.1

26.6

Add variablefrequency drive
inverters to areapumps

To meet the demand of supply pressure for theoperation of pumps in facilities, an inverter is addedto effectively regulate the power

173.7

87.2

Energy-saving
improvement offacility lighting

Replace the original emergency lighting with LED
lighting in the facility, parking lot and restaurant
under the condition that the illumination level andservice life are not lower than the original

23.6

11.8

Energy-saving
improvement of
Air Conditioning
Cooling Tower Fan

The traditional cooling tower fan blades arechanged to thick airfoil energy-saving blades, andthe streamlined airfoil design reduces air resistance,
reduces motor load current, and thus saves energy

74.7

37.5

Replace ConstantTemperature and
Humidity Chamber

Replaced the constant temperature and humidity
chamber with a newer, energy saving model andreduced the annual energy consumption from 450
MWh to 312 MWh

80.5

40.4

1,944.1

1,174.6

Total

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Renewable Energy

Power Saving Performances in 2021

NantouInclusive
Workplace

Environmental Protection
and Occupational Safety(MWh)(Metric tonnes CO2e)

Item
GHG Emissions(Metric tonnes CO2e)
Percentage (%)

Marketbased

GHG Emissions(Metric tonnes CO2e)
Percentage (%)

Category 1 Category 2

Total

4,592.71

201,538.85

206,131.56

2

98

100

4,592.71

26,617.41

31,210.12

15

85

100

Note 1. Carbon emissions reduction = Electricity saving x electricity emission coefficient
2. Electricity emission coefficient:• Zhangjiang, Jinqiao, and Kunshan Facilities adopt the Huadong Power Grid 0.792 metrictonnes CO2e / MWh which in "2019 Emission Reduction Project: China's regional gridbaseline emission factor" by the Department of Climate Change• Nantou Facility adopt the "2020 Electricity Emission Factor" announced by the Bureau ofEnergy, with a CO2 emission factor per kWh of 0.502 kg CO2e/kWh
3. The data presented came from the ISO 14064-1:2018 inventory results, rounded to the 2nd
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Appendix

Water Resource Management
USI does not have issues on contaminating catchment areas as our facilities are not built around
it. But Mainland China's regulation has become increasingly rigorous and ASEH paid close
attention, the storage and distribution of water resources have also become an important topic
for us. USI has been making efforts in conserving water resources and continues to manage
the resources in our production and daily life. Apart from regularly tracking the water usageof USI's six major manufacturing facilities, USI also commissions a third-party to check thequality of effluents on a regularly basis to prevent water pollution from happening. Each facility
tests the watch items in accordance with local laws and regulations: In Zhangjiang and Jinqiao
Facilities, the watch items include pH value, SS, BOD, COD, ammonia nitrogen, total phosphorus,
petroleum, animal and vegetable oils, and sulfides; in Nantou Facility, the watch items include
water temperature, pH value, SS, BOD, and COD; in Mexico Facility, the watch items include
BOD, TSS, copper, nickel, cadmium, lead, hexavalent chromium, zinc, arsenic, and mercury; in
Shenzhen Facility, there are no relevant watch items and the discharge water management
follows the national discharge water standards; Kunshan Facility leases some floors of the ASEH's
factory. In the water intake and discharge, ASEH is responsible for control and the Kunshan
Facility only shares water-related costs. There was no violation of water discharging regulationsin 2021, and USI will continue to keep a track on the use of precious water resource and save as
much water as possible for a friendly environment and reduction of environmental impacts.

USI total water consumption in 2021 was 861.89 ML, an increase of 7.2% from 2020 (803.69
ML). However, our water intensity is reduced by 36.4% compared with 2015, achieving the goalof water saving. In terms of water intake, except for the use of underground water sources in
Nantou-TT Facility, all other facilities use tap water sources. The annual underground water
consumption is 61.03 ML, and the water consumption of tap water is 800.86 ML. In terms ofwater discharge, 742.46 ML of wastewater was discharged into the sewage systems. Analyzing
the data, operational expansion is the main reason why the overall water intake of USI has
increased compared with the previous year.
To make the use out of every drop of water, USI is planning to recycle as much water as possible
via improvement of equipment and technology. In 2018, the process water recycling system wasintroduced to Zhangjiang Facility. This system enables USI to recycle process water produced
from the cutting process; filter and sterilize the water through filtration, disc filter, ceramic
ultrafiltration membrane and UV sterilization processes; and reuse the water in the production.
With respect to the second-phase installation of process water zero discharge system at Jinqiao
Facility, this project has adopted advanced oxidation technology. In 2021, USI recycled 236.97
ML of water, with a recycling rate of 27.5%, and estimated savings of CNY 879,187. In addition,
the process water consumption is 314.13 ML, with a recycling rate of 73.1%.

Water Withdrawal and Discharge in 2021
Facility

Unit: ML

NantouZhangjiang

Jinqiao

Shenzhen

Kunshan

SourceTap water

Tap water

Tap water

Tap water

Tap water

Groundwater

Tap water

Tap water

Water Withdrawal

361.972

120.161

98.96570.27824.12661.03392.68732.665

Sewage treatment
facility

Sewage treatment
facility

Sewage treatment
facility

Sewage treatment
facility

Maoluo River

Sewage treatment
facility

City sewage
treatment facility

325.775

108.145

89.06963.25043.401

83.41829.399Discharge Flow
Water Discharge (1)TTNK

Note 1. Apart from the Nantou-TT Facility, USI has no discharge water flow meter in each facility. Thus, the water discharge volume is estimated based on the estimation principle of 90% of the water intake

71

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Appendix

Waste Management
Water Withdrawal and Recycle
27.5

24.6

22.7

%

%

22.3

%

%

14.3
%

804

728

862

682
582

2017

2018

2019

Water Withdrawal (ML)

2020

2021

USI considers "Waste Minimization and Reuse" as corporate policy. The principles of "Effective Reduction & Circular Reuse"and "Impact Mitigation & Continuous Improvement" have been carried out thoroughly in all the facilities and treated as annual
performance indicator. Therefore, through regular data record and tracking, the relevant units such as process unit, facility affairs
unit, and EHS unit strictly monitor the usage and outputs. USI has developed a waste disposal program specifying that hazardous
wastes must be handled by qualified suppliers with valid licenses for disposal and that non-hazardous wastes must be given tolicensed recycling operators for recycling or shipped to the licensed incinerators for incineration. During the waste removal process,the responsible EHS department monitors and follows vehicles from time to time and review the track records of the waste
removal vehicles to confirm that the waste is handled in accordance with the regulations and contracts.
According to the statistics, the total amount of waste generated in 2021 was 9,733.33 metric tonnes, and the recovery amount was
8,318.25 metric tonnes, with a recovery rate of 85.5%. Although it is slightly higher than the previous year, it still meets the annual
target (80%). The details are shown as follows. In 2021, the production of non-recyclable hazardous waste in the manufacturing
process increased due to the introduction of new manufacturing processes and chemicals in some facilities. USI continues to focus
on product package outer box, partition and tray cleaning and recycling, with a total weight of 1,284.79 metric tonnes recycled andreused in 2021. In the future, USI will continue to implement the waste reduction policy, reduce volume from the source, and strive
to achieve the goal of resource sustainability.

Water Recycling Rate (%)

Water Usage Ratio

7,814

7,239

8,766

7,806

88.2

89.2
%

%

86.1
%

5,586

420

93%

2017

85.3

85.5

2020

2021

%

538

697

2018

Hazardous Waste (metric tonnes)

2019

783
2020

%

967
2021

Non-hazardous Waste (metric tonnes)

2017

2018

2019

Waste Recycling Rate (%)

7%
Tap Water

Groundwater72

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Appendix

Statistics of Disposal Methods for Various Wastes in 2021 (1~2)
Treatment

Reuse

Recycling

Composting

Landfill

Incineration

Hazardous

Nonhazardous

Hazardous

Nonhazardous

Hazardous

Nonhazardous

Hazardous

Nonhazardous

Hazardous

Nonhazardous

Zhangjiang

0.000

0.000

3.120

674.9520.000

368.5670.643

36.961378.2390.000

Jinqiao

0.000

0.000

0.132

239.3020.000

180.000

0.000

26.12591.1090.000

Shenzhen

0.000

542.86174.685

1,284.866

0.000

82.6200.000

84.55351.770

0.000

Kunshan

0.000

0.000

121.000

1,779.925

0.000

164.7850.000

44.49552.562

0.000

TT

0.000

741.9330.000

156.904

0.000

66.960

0.000

0.000

156.255

181.940

NK

0.000

0.000

0.000

532.672

0.000

67.230

0.000

0.000

8.835

155.908

0.000

0.000

3.849

1,073.666

0.000

158.2200.000

120.64825.0340.000

Facility

NantouMexicoTotal

1,284.794

5,945.073

1,088.382

Note 1. Statistics are rounded to the 3rd decimal place
2. Electronic waste is recycled / treated by qualified local licensed operators according to law, and the operators currently cooperating with USI have not obtained third-party certification

73

313.425

1,101.652

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Appendix

Air Pollution Control
In recent years, air pollution is getting worse in Mainland China and Taiwan. It seriously affected
the quality of life to residents that become an urgent issue. This is the reason that local authority
has made relevant amendments to local regulation. As our production facilities are within theaffected areas, we also pay great attention to air pollutant control within our facilities.

According to statistics (2), VOCs emissions in 2021 were 55.238 metric tonnes, an increase of 17%
from the previous year. After analysis, the reason was that the increase in the use of organic
solvents in response to the expansion of the company's operations, so the VOCs emissions haveincreased slightly from the previous year.

In terms of volatile organic compounds (VOCs), Nantou Facility was the only one required to be
regularly inspected and declared. However, requested by the competent authority of Shanghai
City at the end of 2017, Zhangjiang Facility and Jinqiao Facility made their first declaration.
In 2018, in response to the "Environment Protection Tax" declaration requirements of thesupervisory authority, the statistical methods were adjusted and declared, and activated carbon
towers and water washing towers were installed. Although Shenzhen Facility and Kunshan
Facility do not have relevant regulations, they still took the initiative to carry out relevant
detection and management, and implemented relevant preventive and control measures,such as UV light decomposition (1) and carbon treatment measures to reduce VOCs emissions.

For the emissions of nitrogen oxide (NOX), sulfur oxides (SOX), and particulate matter, although
they have not been included into local regulations, Zhangjiang Facility and Jinqiao Facility still
voluntarily detect and disclose emission data. In 2019, to reduce the emissions of nitrogenoxides in boiler exhaust gas, Jinqiao Facility carried out boiler exhaust gas transformation andequipped with a low-nitrogen burner. In the future, USI will let other facilities disclose relevant
information, and actively promote the expansion of related improvement measures to otherfacilities. The air pollutant emissions data (3~6) for 2021 is shown in the table below:
Unit: metric tonnes

Facility
55.23844.64023.792

2017

47.05623.295

2018

2019

2020

2021

Emissions (metric tonnes)

Note 1. UV beam can break the molecular bond of industrial wastes as well as the water and oxygen in the air. Then, with the use ofozone, the oxidization reaction takes place for deodorization and sterilization
2. The data includes Zhangjiang, Jinqiao, Shenzhen, Kunshan, Nantou Facilities
3. The estimated emission level and amount in the test report produced by a third-party test body are adopted for the Zhangjiang,
Jinqiao, Shenzhen, and Kunshan Facilities, and the data are rounded to the 3rd decimal place

Zhangjiang

Jinqiao

Volatile Organic
Compounds (VOCs)

4.485

1.481

1.227

Nitrogen Oxides
(NOX)

1.148

0.589

Sulfur Oxides (SOX)

N.D.

Particulate Matter
(PM)

1.796

PollutantShenzhen Kunshan

Nantou
TT

NK

0.991

23.39723.656

N/A

N/A

N/A

N/A

N.D.

N/A

N/A

N/A

N/A

0.672

N/A

N/A

N/A

N/A

4. The discharge amount of Nantou Facility are based on the declared amount of air pollution fees collected by local environmental
protection organizations, which are calculated with mass balance
5. N.D.: Non-Detectable, the level is too low to be detected by the instrument
6. N/A: No applicable local regulation and no available self-testing data74

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Appendix

Green Manufacturing and Expenditures
Clean Production

Green Office

In addition to adopting ecological design for its products, USI conforms to the principles of
the cleaner production evaluation system at all its facilities in production and manufacturing,logistics and transportation, green management, and social responsibility to implement resource
conservation, green manufacturing processes, pollution prevention and innovative eco-friendly
design. This has not only lowered the impact of manufacturing processes upon the environment,
but also reduced costs of raw materials, energy, and pollutant treatment while increasing
economic and environmental protection benefits.

USI continues to promote green office culture. To reduce paper use in the office, related
document signing operations have been introduced successively into online e-signature system.
The electronic payroll, company parking, and accommodation expenses were incorporated
with e-invoicing system. The in-facility orientations were held to promote the use of e-carrier.
Furthermore, in accordance with the specifications of "EHS & Energy Change Management
Procedure", the purchase of products related to green labels has been given priority when theequipment change, or modification requests are made. In terms of office energy saving, all ourfacilities have also eliminated old air-conditioning equipment as well as traditional fluorescentlamps since 2015 and replaced with new high-performance air conditioning systems and energy
efficient LED lighting fixtures.

Since 2011, Zhangjiang, Jinqiao, Shenzhen, and Nantou-TT Facilities have successively obtained
clean production certification. In 2019, Nantou-NK Facility started undergoing EEWH green
building certification, and successfully obtained the first green building certification in 2020.
In addition, we have cooperated with solar construction companies to build a solar power
generation system with a total capacity of 499 kWp (1). Since October 2019, it has officially put
into power generation. In 2021, it produced a total of 1,508 MWh green power. In the future,
we will continue to focus on clean production and green building promotion to build up a green
factory of USI.
For Zero-Net Deforestation, wood materials we use are mainly pallets or crates used in
product transportation. In addition to the materials designated by customers, USI follows therequirements as below:

Type

Range of Use

Requirements

Plastic Pallets or Anti-static
Plastic Crates

For all in-facility transportation andstorage of products / raw material,
as well as the transportation to thecustomers nearby

Self-recycling and reuse

Regenerated Wooden
Pallets or Crates

For long-distance transportation tocustomers

Recycle and reuse by outsourced
manufacturers

Fumigated Wooden Pallets

Designated by customers

Made by fast-growing trees

Green Expenditures
To calculate our investment in the environment, we have classified relevant costs according to thenature of ASEH's environmental expenditure (including Operating Cost, Upstream / Downstream
Cost, Management Overhead and Social Activities Cost. For detailed expenditure details, pleaserefer to Sustainability Data - Environmental E. Environmental Expenditures). In 2021, due to theincrease in operating cost investment, USI's total environmental expenditure was approximately
CNY 26 million, a decrease of 8% from the previous year. In the meantime, we have continued tofurther improve our environmental management by calculating and analyzing relevant costs on aquarterly basis.

Expenditures of Environmental Protection

Note 1. kWp is the calculation unit of the solar cell's power output under standard sunshine conditions; 1 kWp = 1 kilowatt-hour (kWh)28,131,111
20,729,688
14,936,818

2017

2018

2019
Environmental Expenditure (CNY)75

25,989,443

23,179,611

2020

2021

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Appendix

Biodiversity
USI Facilities are not located in World Heritage sites or protected areas. We are committed tobiodiversity by taking the following measures:
Confirm that new facilities are not located in legally protected areas and biodiversity sensitive
areas and avoid deforestation
Comply with local ecological protection laws and regulations and implement environmental
assessment operations at facilities to confirm that there are no ecologically sensitive sitesaround the facilities and that there is no significant impact on the ecological environment
Mitigate by avoidance, minimization, restoration, and offsets when operating in areas near
critical biodiversity
Work with Tier 1 and Non-tier 1 suppliers and promote biodiversity and deforestation
reduction commitments
Collaboration with external groups began in 2013 to increase habitat and soil conservation
through continuous afforestation with No Net Loss (NNL) and Zero-Net Deforestation (ZND) as
the goals. Future operations will move towards Net Positive Impact (NPI), please refer to theConserving the Environment section.
USI Facilities in Mainland China, Nantou and Mexico are all located in high-tech and industrial
parks. We are committed to reducing energy consumption and energy recycling in our operations
and seek to stop or reduce forest destruction caused by our production and sales processes (NoGross Deforestation). By 2045, continue to reduce the impact on the biological environment
caused by our operations.

is CNY 24,926,384. Greenhouse gas emissions categories 1 and 2 together account for 44%,
followed by water consumption accounting for 42%. Comparing the results of the two years, theoverall environmental external costs in 2021 increased by 2% compared to 2020, while the total
revenue in 2021 increased by 15.94% compared to the same period in 2020, the environmental
costs were able to maintain a slight increase despite the significant increase in revenue, which
demonstrates our dedication and excellent results in reducing the environmental impact in
2021. USI's environmentally friendly operations, such as the use of recycled water, generated
positive benefits of CNY 3,098,258 and CNY 3,985,332 in 2020 and 2021, respectively, and thecarbon storage benefits from tree planting generated positive values of CNY 2,766 and CNY 5,814,
respectively, in the same years. The total of the two positive benefits in 2021 increased by about
29% compared to the previous year, which signifies USI's efforts in environmental protection
were able to maintain a small increase in the negative impact.

Cost Value Analysis of External Environmental Costs
70,883
1,817,641
982,538

2,087,408

1,950,888

1,304,282

1,133,517

14,399,529

12,492,394

Environmental Profit and Loss

11,455,117

To further create useful products and services using natural capital and reduce the direct orindirect impact on the environment during the process, USI introduced Environmental Profit
and Loss (EP&L) methodology in 2020 to help the company to make effective decisions byweighing different issues through monetization management. We focus on major environmental
issues related to operations, including greenhouse gas emissions, air pollution emissions, waste
generation, water resources use, and tree planting carbon sinks. Using EP&L methodology,
we map out the impact event chain of environmental pollution emissions and resource
consumption. And calculate the environmental cost of human health damage, environmental
resource reduction and ecosystem impact caused by these behaviors.
The environmental impact of USI production operations in 2020, after value conversion, is CNY
24,411,787, of which the main source of environmental impact is greenhouse gas emissions(the impact of greenhouse gas emissions is the result of offsetting the positive benefits ofcarbon sinks from tree planting), with categories 1 and 2 accounting for 49%, followed by water
consumption, accounting for 38%. In 2021, the cost of the environment outside the country

10,729,972

2019

73,81072,352

11,863,660

11,052,501

2020

2021
Valued Value (CNY)Greenhouse Gases(Category 1, 2)

Water Consumption

Air Pollution

Waste

Kitchen Waste

76

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Appendix

Occupational Health and Safety
To ensure employees and other workers' physical and mental
health during working hours. In addition to complying withlocal labor laws and safety production regulations, USI has
stipulated safety and health policies, objectives, standard
procedures, and held educational training and LOHAS
activities. All our facilities passed the ISO 45001 Occupational
Safety and Health Management System which includes our
employees and other workers (1) (Coverage Rate = 100%), so
we review our policy and performance yearly to satisfy therequirements of occupational health and safety laws and ourpolicies and continuing to provide a safe and comfortableworkspace.

Occupational Health and Safety
Management
Health and Safety Management Goals andStatuses in 2021
Goals

Safety and Health / Production Committee's
Responsibilities
Guard theworkplace

Performance

Maintaining ZeroOccupational Disease
Incidences

No cases of occupational disease
occurred.

Maintaining Zero
Work-Related Deaths

No cases of work-related deaths
occurred.

Zero Infections from
Infectious Diseases
within Facilities

Since 2016, we established auniversal notification system andenhanced our emergency response
capabilities. No infectious diseaserelated cases occurred in 2021.

Note 1. Other workers are mainly temporary workers in the facilities, and othercontractors such as kitchen contractor, resident personnel, security personnel,
and cleaning personnel, 3,963 people in total.

77

To understand and grasp the safety and production, the six
major manufacturing facilities of USI are required by local laws
and regulations to set up a Safety and Health / Production
Committee by employees, with employee representatives
as the management representatives of the committee, andthe proportion of labor representatives is at least one-thirdin each facility in accordance with local laws and regulations.
The frequency of the committee meetings varies from facility
to facility, but regular meetings are held at least once every
three months to coordinate occupational safety and healthmanagement matters. Besides, an internal exchange platform
and paths for the sharing of the Company's information system
are also established within the facility (including WeChat
and irregular exchange sessions) to ensure the availability ofsmooth communication channels.

Prevent
occupational
diseases

Guarantee theinvestments are
inputed

Safetyand Health/
Production
Committee

Ensure thetrainings andeducations areaccomplished

Developand implement
health management
Perfect the systemand promotionof production
Supervise andresponsibility
check theproduction works

To ensure the safety and health of workers in the facility, USI
invested CNY 159 million in safety production and chemicalsafety management in 2021. Occupational safety and healthcosts include employee insurance, physical check-up, labor
protection, safety measures improvements, operating
environment monitoring, and ISO 45001 certification fee.

Occupational Safety Risk
Management
As part of the risk-based thinking required by the ISO 45001
Occupational Health and Safety Management System, USI
establishes a process to manage procurement, contracts,
and changes. We implement necessary safety assessments,
trainings, and data updating to reduce potential safety
and health risks from operating conditions or the work
environment.
To effectively identify and assess safety and health hazards
and risks and opportunities derived from the operations andwork environment, we request responsible units to identify
hazards based on occurrence probability, exposure frequency,
and consequence severity every year. Where the identification
and assessment procedures must be applied again due to any
change to the production or activity; opinions or requests
made by the stakeholders / adjustments or amendments
to legal regulations, the results must be evaluated together
with potential risks and opportunities, regulatory rules, andthe Company's policy. The Company identifies and controls
priority risks and opportunities and request relevant parties
to amend plans based on the level of involved dangers andopportunities. The purpose is to minimize negative impacts
that come from productions, activities, or services within
the facility; and to enhance the Company's occupationalsafety and health performance and to create a soundAbout this Report

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Hazards, Risks, and Opportunities Identification Procedure
management system. In the meantime, to ensure the qualityof identification and assessment procedures, not only
should designated safety and health units conduct relevant
educational training on a regular and irregular basis (Pleaserefer to the Occupational Safety and Health Training section),but also the representatives of promoting health and safetymeasures shall take internal auditor training within the ISO
45001 management system and acquire qualifications.

●●

Draw hazard identiﬁcation
ﬂowchart

Plan

Do

●

Establish safety and healthgoals and management
plans● Conﬁrm improvement

Action

Check

●

●

Analyze the job and operation
items
Identify hazards, risks, andopportunities

Summarize and deﬁne
priorities to lower risks andopportunities

Management Measures for Identified Hazards, Risks, and Opportunities in 2021
Risk and
Opportunity Level
1. Serious

2. High

3. Medium-High

4. Medium5. Low

6. Slight

Corrective Action
1. Control measures must reduce the risk to
an acceptable range
2. Review the integrity of existing protection
and control measures and formulate
management plans for improvement. If
there is no improvement, it is necessary
to formulate operation control proceduresor emergency response plans

It must be reviewed whether there are still
opportunities to improve the performanceof occupational safety and health, such as:
1. Measures to further reduce personnel
exposure frequency or incident rate
2. Adjust the work, work plan, and working
environment suitable for workers
3. Reduce the monotonous work or working
frequency
4. Strengthen existing control measures

Identification
ResultHazard or Impact Above
Medium Level

Management Measures

There are no Serious or High-Level risks and opportunities in the work activities or working environment of USI facilities.

Part of the factory
operations
and high-risk
operations
employees have
Medium High or
Medium Level risks
and opportunities;
others are Low or
Slight Level risks
and opportunities.

Elevated operations: drop, fallMust wear safety belts and helmets and use compliant auxiliary equipment; set up
the operation control area and have workers from the same industry to assist in theoperation.

Confined space operations: hypoxia

Wear self-contained breathing apparatus and strengthen training.

COVID-19: infectious diseases
within facilities

Carry out relevant requirements and measures for personnel access control, selfmonitoring temperature, notification system, and environmental protection.

Hot work operation: fireMust control fire sources and combustibles, wear personal protective equipment, carryspare fire extinguishers, and strengthen training.

Work environment (such as
using organic solvents, X-Ray
inspections): inhalation hazard, skincontact hazard or body pathology

In addition to regular monitoring of high-risk operating environments (including
lighting), special health inspections should be carried out. The inspection items include
noise, carbon dioxide concentration, organic solvents, specialized substances, dust, lead
workplaces, and free radiation; they require personal protective gear during operation.

78

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Management

Green Products
and Innovation

Value Chain
Management

In 2021, there were more than 40 management programs included in the tracking management,
which includes strengthening the management of hazardous operations and eliminating safety
hazards of machinery and equipment, such as installing sensors and protective devices on
automated warehouses and automatic pallet wrapping machines to prevent accidental collision
with or intrusion by humans. By the end of 2021, all the management programs have been
improved.
At the same time, to provide a better workplace environment, USI rewards employees for
proposing any improvement measures that mitigate any occupational hazard or disease, and if
employees find that there is a direct threat to personal safety and other emergency situations,they can immediately suspend their work at hand and evacuate the workplace according to theemergency response measures of each facility. USI will not punish any employees for the above
actions.

Safe Workplace
To ensure the safety of workers, each facility conducts automatic inspections in accordancewith government regulations and the company's operating standards, and EHS personnel also
conduct routine safety audits, which covers occupational safety, health, and hygiene, as well as
management systems. In some facilities, the inspection results are included in the safety andhealth evaluation activities, and outstanding units are publicly recognized in the regular safety
and health / production meetings to encourage personnel to participate in safety and healthmanagement and improvement measures.

Audit Results Over the Years (1)
Year

2018

2019

2020

2021

Safety

598

330

376

747

Health

142

53

108

121

1

5

11

47

Dimension

Management System

Note 1. The data includes Zhangjiang, Jinqiao, Shenzhen, Kunshan, Nantou Facilities

79

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and Occupational Safety

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Appendix

In addition, according to the actual operating hazards of each facility, qualified institutions
are also commissioned to regularly implement environmental testing in order to control theoperating environment of the hazard factors, testing items such as building security, drinking
water safety, sewage testing, Legionella pneumophila bacteria, emergency lighting, lightning
protection testing, smoke detection equipment and fire equipment testing. At the same time,
the company also regularly monitors operational environments with high risks including noises,
the concentration of carbon dioxide, organic solvents, specific chemical substances, lead in theworkplace and free radiation to ensure that the threshold values of concentration of harmful
substances and noises are below standards. If there are any abnormalities, it will be immediately
corrected and maintained; if it is close to the abnormal state, we will provide employees withappropriate preventive training, and with a healthy and safe working environment.

Chemical Safety Management
We developed our Chemical Management Procedure in line with the UN Strategic Approach
to International Chemicals Management (SAICM), so chemicals are controlled and used inways that minimize adverse impacts on the environment and human health. The key to our
Procedure is a comprehensive review of substances and all applicable chemical regulations anduse restrictions. We grade chemicals according to environmental and safety risks and constantly
update them into our database. As part of source control, chemicals must be checked against
the database, reviewed, and filed before they can be procured and subsequently introduced
into our manufacturing process. All personnel involved with handling chemicals must undergo
before work training and regular training to ensure that chemicals are handled safely from themoment they enter our operations until they are appropriately disposed of or recycled. We keep
all relative records to optimize our Procedure and prevent occupational hazards.

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Management

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and Innovation

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Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Chemical Safety Management Process

USI’s internal
chemical database

Check forprohibited
substances

New chemicals
evaluation

Hazardidentiﬁcation

No

Authorizedpurchase and use

YesNo
Find alternative
substances

Check forregulatory
exemption

Filed andcontrolled

Yes
Approved for
one year

Operational risk and waste management,
personnel training and record keeping

Occupational Incident Management
To ensure that the relevant units can respond quickly when an occupational incident occurs,each facility has established procedures for accident investigation and handling, stipulating that
if a near miss, occupational injury or occupational disease occurs in the facility, procedures suchas first aid, reporting, investigation, and improvement measures would be carried out, and at
the same time improvement measures are proposed based on the root cause of the accident.
All improvement measures would be carried out across all facilities, and relevant continuous
improvement would be tracked regularly to prevent the recurrence of similar accidents.
In 2021, there were 13 physical injuries (including forklift crushing, clamping, slipping, spraining),
one ergonomics injury (lifting sprain), and two near miss incidents. Our injury statistics indicatedthat one injury occurred in Jinqiao Facility and one in Nantou Facility at the end of 2020, which
was caused by a fall on a staircase and an automatic warehouse injury caused by a person notfollowing the SOP. The accident involving a forklift occurred at the Nantou Facility, in which theoperator did not wear safety shoes during the material picking operation, resulting in a crushing
injury caused by the forklift. After analyzing the root causes of the accident, we reinforced therequirement to wear steel-toed safety boots for forklift operators, extended forklift operation
safety training for qualified personnel, and strengthened daily audits by supervisors to prevent
recurrence. The above three incidents are the main reasons for the increase of lost day rate in
2021. Also, several "walking injury" incidents were recorded. In addition to the improvement oflighting and floor slip prevention, we posted warnings and strengthened advocacy and training,incorporated safety requirements into the employee code of conduct, and continue to work
towards the goal of zero accidents. There were no accidents resulting in injury or death of
employees or damage to equipment resulting in production stoppage in 2021.

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and Innovation

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Management

Inclusive
Workplace

Environmental Protection
and Occupational Safety

SocialInvolvement

Appendix

Occupational Injuries and Occupational Diseases in 2021 (1)
Year
Items
Total Hours Worked

Facility
2018

2019

2020

2021
Jinqiao

Shenzhen

KunshanNantouMexico39,253,041

45,670,981

42,065,676

44,539,170

8,510,206

4,720,205

8,404,067

4,929,600

8,027,468

9,947,624

6

14

12

14

0

0

1

0

7

6

Lost-time Injury Frequency Rate (2)

0.15

0.31

0.29

0.31

0

0

0.12

0

0.87

0.60

Rate of High-consequence Workrelated Injuries (3)

0

0

0

0

0

0

0

0

0

0

Number of Work-related Fatalities

0

0

0

0

0

0

0

0

0

0

Rate of Fatalities as A Result ofWork-related Injuries (4)

0

0

0

0

0

0

0

0

0

0

Occupational Diseases Rate (ODR) (5)

0

0.02

0

0

0

0

0

0

0

0

Number of Days Lost Due to Injuries

111

75

124

460

0

66(6)

21

0

352(6)

21

2.83

1.64

2.95

10.33

0.00

13.98

2.50

0

43.85

2.11

Number of Lost-time Injuries

Lost Day Rate (LDR) (7)Note 1. Statistical count excludes traffic accidents during commutes. Please refer to the Contractor Management section for information on
work-related injuries of contractors
2. Lost-time injuries frequency rate (LTIFR) = (Number of lost-time injuries ÷ Total hours worked) × 1,000,000
3. Rate of high-consequence work-related injuries = (Number of high-consequence work-related injuries ÷ Total hours worked) ×
1,000,000
4. Rate of fatalities as a result of work-related injury = (Number of fatalities as a result of work-related injuries ÷ Total hours worked)
× 1,000,000

81

Zhangjiang

5. Occupational Diseases Rate (ODR) = (Total numbers of occupational diseases ÷ Total of hours worked) ×1,000,000. Statistics ofoccupational disease are in accordance with the definition of occupational diseases from relevant local laws and regulations foreach facility
6. Include work-related injuries that occurred in 2020 and count lost days in 2021
7. Lost Day Rate (LDR) = (Number of days lost due to injury ÷ Total of hours worked) × 1,000,000. Number of days lost due toinjury are based on the information collection period until 12 / 31 / 2021

About this Report

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Management

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and Innovation

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Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Occupational Safety and Health Training
In order to enhance employees' awareness of occupational safety and health, USI has
established "Environmental Safety and Health and Energy Education and Training Management
Regulations" at each facility to draw up annual environmental safety and health education andtraining plans according to practical needs, and to conduct safety and health education andtraining for new recruits and in-service personnel (e.g., chemical safety operation, electricalsafety, personal protective equipment use and workplace accident management training),
regulatory and certification training (e.g., first-aid personnel, special machinery and equipment
safety management and radiation device operation training), management system operational
training, emergency response training, and contractor education training (please refer to theContractor Management section), as well as arranging drills and tests for employees to enhancetheir knowledge and skills and their ability to deal with emergencies. 410 advocacy and training
courses were held in 2021, with 50,851 employees trained 57,776 hours.

Occupational Health and Safety Training Data
Year
Items

2018

2019

2020

2021

Total Number of Courses

Data not available

183

207

410

Total Number of Trainees

21,68732,44356,28550,851

Total Training Hours

41,686

21,942

48,411

57,776

To ensure employees fully understand facility evacuation routes and how to use emergency
response equipment, our EHS Emergency Response Center developed a hazard awareness plan,
emergency response procedures, and conducted emergency response training for disasters
caused by earthquakes, fires, and chemical leaks, so that employees can effectively apply theirdrill trainings and minimize accidental injuries and impacts when the actual emergencies occur.
In 2021, 32 disaster drills were held, including 7 first responder trainings, 4 earthquake disasterprevention drills, 13 fire drills, and 8 chemical disaster drills.

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and Innovation

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Management

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and Occupational Safety

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Appendix

Contractor Management
Companies outsource technical and professional projects to contractors have become an
inevitable trend. Besides the requisition of contract project quality and schedule, USI values
contractor's safety and health management. EHS & Energy Policy clearly commits "Raise
workplace environment health and safety awareness through continuous communication
with all employees, suppliers, distributors, contractors, and other business partners. Conduct
training and drills to prevent environmental impact, excess resource waste, and safety hazards".
Our Contractor and On-Site Construction Management Regulations were formulated using
the concept and principle of the PDCA cycle, and we use the Regulations as our guidance toeffectively manage and improve contractor occupational safety and health.

The quality of the contractor's personnel has a significant impact on the quality, duration, andsafety of the work being contracted. Therefore, USI contractors are asked to provide the necessary
documentation of education and training, as well as participate in occupational safety and healtheducation and training conducted by USI.
In 2021, 475 contracting companies, 7,363 participants undertook USI's occupational safety andhealth training (trainees include contractors for: material contractor, factory services, construction,
waste, and other services). After training and evaluation by the EHS departments of each facility, atotal of 2,627 contractor employees obtained construction permits.

Contractor and On-Site Construction Management Regulations
Construction

Document

1 Assessment●

Construction requirements● Contractor qualiﬁcation
evaluation

Education and

2 Review

3 Training●

Contractor information review
Conﬁrmation of construction
application form
● Conﬁrmation of hazardous
work application form●

Construction

Notiﬁcation of working
environment hazards● Agreement organization meeting● Construction supervision● Environmental safety inspection
and audit

Training construction workers
Apply for a construction
permit●Agreement organization
training●

5 Post-Construction
Management

4 Management●●●

Fines for violation
Occupational injury statistics● Feedback to contractor
evaluation●

Note 1. Mainland China Facilities: two abnormal events occurred within half a year; Nantou Facilities: If major violations are not
improved within the time limit, they will be suspended for one year
2. The data includes Zhangjiang, Jinqiao, Shenzhen, Kunshan, Nantou Facilities
3. Hazardous work: including hot work, hanging work, confined space work, elevated work
4. Major findings: on-site auditing findings and issuing a ticket

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NantouZhangjiang

Shenzhen

To ensure construction safety during work performed by contractors, we focus on dangerous
operations and repeat offenders to strengthen the inspection of operational safety during
construction, such as protective equipment for workers and compliance with safe conduct. If
deficiencies are found and not improved immediately, penalties will be imposed in accordancewith company regulations and the results will be included in the evaluation of the contractor'squalifications (1). In 2021, no qualified contractors were disqualified due to safety and health audits.

Contractor Construction Application and Audit Findings (2)
Year

2018

2019

2020

2021

Number of construction applications

2,571

2,483

2,694

3,099

Number of applications for hazardous
work (3)

1,237

564

744

997

Number of findings in on-site audit

34

67

103

34

Number of major findings (4)

31

40

47

34

Items

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Management

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It is our policy to monitor, report, investigate, analyze, and record all types of incidents that occur
with our contractors in the USI Facilities, including occupational disasters, fires, or explosionsin accordance with USI's accident investigation and improvement procedures. Since 2018, only
one contractor-related (1) work injury incident occurred in 2019 and one in 2020, and the main
root causes of the incidents were analyzed, and the facilities asked to strengthen awareness andsupervision. Therefore, in 2021, USI did not have any more work-related injuries or work safety
accidents involving contractors.

Contractor Occupational Injuries and Occupational Diseases (2)
Year

2018

2019

2020

2021

1,312,732

4,868,030

3,766,409

3,157,842

0

1

1

0

Lost-time Injury Frequency Rate

0.00

0.21

0.27

0.00

Rate of High-consequence Workrelated Injuries

0

0

0

0

Number of Work-related Fatalities

0

0

0

0

Rate of Fatalities as A Result ofWork-related Injury

0

0

0

0

Occupational Diseases Rate (ODR)

0

0

0

0

Number of Days Lost Due to Injury

0

8

24

0

0.00

1.64

6.37

0.00

Items
Total Hours Worked
Number of Lost-time Injuries

Lost Day Rate (LDR)

Physical and Mental Health Care
USI provides several on-site health services to build a healthy workplace beyond regulation
requirements. It has established complete software and hardware facilities and assigned
specialized personnel to provide professional services. Additionally, it holds health training,
workshops, and group activities. Moreover, USI conveys information of the Company to its

Note 1. For details, please refer to 2019 Corporate Social Responsibility Report, Page 48 and 2020 Sustainability Report, Page 122
2. Please refer to the Occupational Incident Management section for the relevant ratio calculation formula

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

employees through journals (Newsletter), WeChat group, health email and bulletin board
regularly to enhance their health knowledge and skills to maintain their physical and mental
health and to build an excellent healthy workplace.

Software and Hardware Measures
Regarding the software facilities,
USI wishes to provide employees
a quality healthcare service. We
have several on-site nurses andimplement a health consultation
program that brings generaland specialized doctors onsite, including psychologists,
physiotherapists, nutritionists,and occupational specialists.
We strive to not only preventand reduce occupational injuries
Physical Therapist Intervention
and diseases through these
consultations but also provide
employees with support programs that foster health and well-being. In 2021, USI employees
logged 9,558 hours in 18,519 consultations.
As for hardware, USI nurse stations are equipped with weighing scales, blood pressure monitors,
resting rooms, counseling rooms, and breastfeeding rooms to provide basic health services
for employees. Nantou Facility has received the Nantou County Excellent Breastfeeding Roomcertification for eight consecutive years, continuing to provide a comfortable breastfeeding spacefor mothers.

Physical and Mental HealthTo effectively achieve health management, USI conducts physical check-ups each year. USI
tracks employees with significant abnormalities and conducts the prevention and control ofcontagious diseases. Also, specific physical check-ups are provided for high-risk employees in
the work environment to achieve the effect of early diagnosis and early treatment. In mental
health, USI not only hold birthday parties and single parties regularly for employees (please referto the Employee Benefits section for details), but also has Employee Assistance Programs (EAP).
It works with the human resources department to make sure employees' pressure from theirfamilies, work, and life can be balanced and addressed.

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EAP provides welfare and supportive service for USI's employees. Different from others, it helps
enhance employees' mental abilities to improve their performances. In addition to managing
human resources more effectively, it can deal with crises efficiently, improve production
efficiency, and create a harmonious work environment as well. We have specially arranged an
overall work adaptability assessment for employees with physical or mental difficulties this year
to ensure that all employees have received professional assistance.

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Develop Epidemic Prevention Strategies●

Corporate should modify the strategies to reduce employee health risks and business
impact in response to changes in the epidemic.

Set up and Implement Basic Infection Prevention Measures●

Pandemic Prevention Program
When COVID-19 broke out at the end of 2019, USI set up an Emergency Response CommandCenter, co-chaired by the Chief Human Resource Officer and the Chief Quality Assurance
and Corporate Social Responsibility Officer. Through the Command Center, we have rolled
out relevant control measures to create a healthy and safe working environment and reduce
employee exposure to the viruses. Although there were sporadic confirmed or high-risk casesin 2021, USI has strengthened production diversion management and implemented prevention
measures in advance, and therefore none of the manufacturing facilities were shut down due to
COVID-19. Apart from establishing preventive measures, USI also actively promotes COVID-19
screening and vaccination. In 2021, the Company provided free nucleic acid testing, rapid
screening, and vaccination to employees at our facilities, and 9,176 people participated in thescreening process. By the end of 2021, over 83% of employees were fully vaccinated.

Remind personnel entering and leaving the premises to wash their hands frequently. Set up
alcohol hand sanitizer with 60% to 75% alcohol concentration around the facility.
● Require employees to wear masks and promote coughing and sneezing etiquette.
● Avoid close conversations, adjust working hours and use online meetings to hand over shifts.
● Regular environmental disinfection, such as canteens, conference rooms, training rooms,
elevators, door handles and buttons.

Implement High-risk Case Notiﬁcation and Handling Procedures●

When there are conﬁrmed, suspected, contact-traced, or high-risk cases detected, appropriate
prevention control procedures will be activated.

Formulate and Implement Flexible and Protective Employee Epidemic Precautions●

Provide family care leave to employees who have family members that need care.
Let employees who take leave for epidemic prevention have no worries about the subsequent
payroll issues caused by taking leave.
● Make sure that employees understand the related complementary measures for leave andprovide them with a safe and secure working environment.
●

Implement Workplace Control●

Provide good ventilation and ﬁltering equipment to increase the ventilation rate of the indoor
working environment, or set up transparent protective equipment, such as a canteen partition.
● Strictly control the access of external personnel into the factory, including ﬁlling out forms,
taking body temperature, disinfecting hands with alcohol and wearing masks throughout thevisit, to reduce the possible risk of transmission.
Direct Employee Rapid Test

85

COVID-19 Vaccination

Nucleic Acid TestingThrough multiple channels and mechanisms, the Company has strengthened risk prevention andenhanced employees' awareness of pandemic prevention, and the relevant measures have beenrevised in a rolling manner, in line with the global pandemic status and governmental pandemic
prevention. As the world enters the post-pandemic period, we will continue to pay close
attention to the development of the pandemic and fully cooperate with the local government's
pandemic prevention measures to provide a healthy and safe environment for our employees.

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Health Promotion

Stamina
Strength●

BMI●

Waistline●

Blood pressure●

Total cholesterol●

Triglycerides

●
●
●

●

●

Analysis ofabnormalhealth report

Exercise
Soreness care
Weight management
Physical ﬁtness
promotion
Metabolic syndrome
prevention andtreatment
Chinese medicine
health care

Health promotion
activity participation
surveyInclusive
WorkplaceSocialInvolvement

Appendix

Diversiﬁed Health Promotion Activities

To enhance occupational safety and health management and fortify health hazard
identification, we adjust the focus of the yearly health promotion activities based on theanalysis of employee health examination results and activity feedback to prevent chronic andoccupational diseases. USI also encourage and remind employees to exercise regularly, eat anddrink healthily, and maintain good living habits.

●

Environmental Protection
and Occupational Safety

ImmunityStrength●●●

Knowledge
Strength

WeightStrength

FamilyStrength●●

A total of 42 activities were held during the year, with a total of 13,028 participants.
The Zhangjiang and Jinqiao Facilities jointly held a week-long occupational healthpromotion activity with education and training courses to enhance employees' awarenessof occupational disease protection.
The Nantou Facility was awarded the "Healthy Workplace Certiﬁcation - Health
Promotion Label" by the National Health Agency.
The Nantou Facility donated 303 bags of plasma in a blood donation campaign with theparticipation of 200 employees.
588 employees participated in the Nantou Facility's weight loss activity and lost a totalof 936 kg.

Productivity
Strength

10 Strengths of
Healthy Living

CardioStrength

MuscleStrength

Love
Strength

Respiratory
Strength

Occupational Disease Prevention Promotion

Blood Donation Drives

Weight Management Activity Program

Women's Health Lectures

Physical Fitness & Health Promotion

Bone Density Detection

Health promotion program

USI provides not only professional physician consultations, but also holds various healtheducation seminars, training, and activities such as pregnancy healthcare, cancer screening
services, vaccination services, blood donation activities, weight-loss competitions, quit smoking
contests, and bone density detection. In 2021, due to the pandemic, many activities could not
be held, but some were conducted through email announcements and video conferencing
applications.

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Appendix

Inclusive Workplace
Talents are the essential seeds for USI's continuous growth and need to be carefully nurtured and watered. We build an inclusive workplace for employees by Enforcing Human
Rights, Implementing Talent Development, Providing Comprehensive Benefits, and Cultivating Harmonious Labor Relations.

17,923
96
100
116
84
97
111
133

Employees New Hires% Key Talent Retention Rate
% Working Hour Warning System Establishment

Events Global Employee Symposiums% Employee Engagement Rate

% Local Hire Rate
Events Employee Activities

Employees Sponsored to Obtain Degrees

87About this Report

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Environmental Protection
and Occupational Safety

Key Performance and Targets
SDGs

Business Action

2021 Key Issue

Talent Attraction
and Retention
Ensure all employees
have accesses to be
trained and havelifelong learning
opportunities

Human Capital
Development

Provide all employeeswith reasonable
working conditions andallow everyone to havean appropriate job

Inclusive
WorkplaceSocialInvolvement

Achieved

KPI

2021 Target

2021 Performance

Employeeengagement (2)Employeeengagement rate ismore than 80%
Data coverage rate ismore than 80%

Not Achieved (1)2022 Target

2026 Target

Employeeengagement rate is84%
Data coverage rate
is 89%

Employeeengagement rate
is more than 83%
Data coveragerate is more than85%

Employeeengagement rate
is more than 85%
Data coveragerate is more than85%

Turnover rate

Direct employee (DL)turnover rate is lessthan 55%
Indirect employee(IDL) turnover rate isless than 12%

DL turnover rate is46%
IDL turnover rate is18%

DL turnover rateis less than 55%
IDL turnover rateis less than 12%

DL turnover rateis less than 50%
IDL turnover rateis less than 10%

Key talent retention
rate

Key talent retention
rate is more than90%

Key talent retention
rate is 96%

Key talentretention rate ismore than 95%

Key talentretention rate ismore than 95%

Employee career
plan

Subsidize more than
40 employees toobtain degrees

Subsidize 73
employees to obtain
degrees

Subsidizemore than 50
employees toobtain degrees

Subsidizemore than 80
employees toobtain degrees

Internal instructor
training

Internal instructor
number adds up over
880

Internal instructors
are total of 867

Internal instructor
number adds up
over 910

Internal instructor
number adds up
over 1,000

Human rights risk
assessment

Set up proceduresfor human rights risk
identification andmitigation
Implement anovertime warning
system in 70% of
operation facilities

Promulgate andimplement therevised Human
Rights Policy
Set up human rights
risk identificationand mitigation
procedures
Implement overtime
warning system inall facilities

Implement
human rights
risk identificationand mitigation
procedures in
100% of operation
facilities

Implement
human rights
risk identificationand mitigation
procedure in
100% of operation
facilities

Equal employment
opportunities

Employ more than 70
disabled employees

Employ 83 disabled
employees

Employ morethan 80 disabled
employees

Employ morethan 120 disabled
employees

Human Rights

StatusAppendix

Note 1. For unachieved targets, please refer to the corresponding sections for relevant explanations and future improvement plans
2. The employee engagement survey will be conducted every two years. The next survey will be conducted in 2023

88

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and Occupational Safety

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Appendix

Human Rights Protection
USI strongly believes that corporates have the responsibility to respect human rights.
We are committed to protecting and promoting human rights with our employees, joint
ventures, suppliers, business partners, customers, local governments, communities, andother stakeholders. We support and respect the United Nations' "The Universal Declarationof Human Rights", human rights as defined in Principles 1 and 2 in "The United Nations
Global Compact", "The United Nations Guiding Principles" on Business and Human Rights,
the International Labor Organization's Declaration of Fundamental Principles and Rights at
Work, and the laws of the countries in which we operate. Being a member of the Responsible
Business Alliance, we adopt its Code of Conduct in our global operations to enforce ourcommitment to protecting human right, enforcing employees' rights and interests atwork, creating a diverse, inclusive and healthy workplace, and making a commitment to abalanced life between work and family, including safeguarding freedom of association andprivacy rights, prohibiting forced labor, prohibiting child labor, prohibiting inappropriate
appointments, and building a non-discriminatory work environment. For the USI Human
Rights Policy, please refer to the USI website. (https: // www.usiglobal.com / en / csr / InclusiveWorkplace / Human-Rights)

Due Diligence Process
USI understands and manages human rights issues in a responsible manner, adheres to the
PDCA process and the concept of continuous improvement, and sets up a special unit of the
Sustainability Committee to identify, evaluate, prevent, and reduce human rights-related impacts
through the due diligence process.

RBA Risk Assessment Framework
Our human rights management focuses on our employees and suppliers that are in ouroperations. Every year we use SAQ (1) through the RBA management mechanism and entrustsa third-party agency that has received special training in social and environmental audits
to simultaneously implement RBA VAP (2) audit to do the risk management for our businessor new business relationship companies to conduct risk management, and the regular risk
assessments are carried out using a risk matrix, which has two quantifiable indicators ofNote 1. SAQ, Self-Assessment Questionnaire, a risk assessment score above 85 is considered low risk; 65~85 is considered medium
risk; below 65 is high risk
2. VAP, Validated Audit Process Validated Audit Process, designed to provide enterprises with assurance of risk identification andpromotion of improvement and a strong management system of labor, ethics, health, safety and environmental conditionsin the supply chain to improve business practices. On-site audits of suppliers, potential suppliers and the company's own
facilities provided by an RBA-approved independent third-party audit

89

frequency and impact. Investigate the results of human rights risk assessment in the past
two years, identify issues and objects that are vulnerable to human rights risks, formulate
measures, make implementation plans, and continue to make improvement. The annual
assessment results would be submitted to each team of the Sustainability Committee andreported to top management team in the regular meeting. We require joint ventures to
conduct human rights risk assessment annually. In their sustainability reports, we also requirethem to disclose their SAQ results, prepare corresponding improvement plans, and follow
up on mitigation and remediation measures statuses. As for the supplier human rights risk
assessment, we conduct a sustainable risk assessment for the annual first-tier suppliers andfurther identify their human rights risks through on-site audits and RBA VAP. From this, wethen identified potential high-risk suppliers and continuously track the improvement effect ofdifferent risk conditions. For details, please refer to the Supply Chain Management section.

Objectives

Sustainability Committee Taskforce

Management Mechanism

Employees andCommunity
Environment

Employee Care & Social Involvement
Taskforce

1. SAQ & VAP
2. Environmental Monitoring
and Negotiation

Supplier

Value Chain Management Taskforce

Annual Sustainability Risk
Assessment and Audit

A

P

ActionPlan

Continuous
Improvement

C

D

Check

Do

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

RBA Human Rights Management Mechanism

Environmental Protection
and Occupational Safety

Zhangjiang
170.2

92.6

Mexico88.5
902

Nantou190.1

1. Dept. manager or HR accept thecomplaint case
2. Set investigation team to investigate
3. Complete investigation within 30 days

95.3

3

4

1. Announcement of disciplinary
judgment
2. Conﬁdential ﬁling of thecomplainant and investigation
information (case closed)

183.6
Shenzhen

92.7

170.8
KunshanBased on the investigation
results, the review committees
make the punishment decision

Jinqiao
174.2

93.4

93.9

Lodge Complaint

Appendix

Human Rights Risk Assessment Results of All Facilities

In accordance with the RBA management framework, each facility implements internal andexternal audits regularly, and arranges cross-site mutual audits every year to ensure fullcompliance with the regulations. If there are any violations, an improvement plan would be
proposed and improved within a requested time period. The Sustainability Committee meetsquarterly to review the achievement and improvement of various performance indicatorsof labor, ethics, environment, safety and health to ensure that the company fulfills various
social responsibilities. The company has established investigation mechanisms and complaint
channels to ensure the implementation of human rights policies and avoid incidents that
endanger human rights. USI has also established employee reporting mechanisms to handle
employees' complaint. The investigation procedure is shown as follows:1

SocialInvolvement

Inclusive
Workplace

SAQ Score

VAP Score

Human Rights Risk Analysis (1)Working Hours

Human Rights Risk Assessment Results
In 2021, all facilities got SAQ assessment scores that are higher than 85, indicating that all
facilities in the assessment of human rights risks are low-risk facilities. After analyzing the VAP
audit results and employee complaints, we found that Mexico Facility has relatively high risks
compared with other facilities. We have developed corresponding human rights mitigation
and remediation measures to the findings.
Note 1. Major risks are those events with high frequency and high impact; minor risks are those events with low frequency and low
impact; other events are classified as secondary risks
2. Other Risks 1 includes industrial hygiene, safety and hygiene, hazardous substances, environmental permits and reporting
work environment safety and hygiene issues
3. Other Risks 2 includes non-discrimination, free choice of employment, manual labor, health and safety communication humanrights issues
4. Other Risks 3 includes risk assessment and risk management, occupational injury and disease issues

Frequency

High

Emergency Preparedness

MediumLow

Occupational Safety

Other Risks 1(2)

Other Risks 2(3)

Other Risks 3

(4)

Low

MediumHigh

Impact90

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Management

Green Products
and Innovation

Value Chain
Management

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and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Human Rights Risk Mitigation & Remediation
In 2021, based on the RBA VAP assessment results and employee complaint cases, we formulateannual mitigation and compensatory measures for the issues that are easily exposed to risks,such as "working hours, non-discrimination, sexual harassment, privacy rights, emergency
preparedness and occupational safety" to improve them through human rights training toenhance employee's awareness of human rights, review the working hours early warning system

Objectives

mechanism again to strengthen working hour management, recruit a sufficient manpower tocope with the impact of productional manpower arrangements caused by both the USI businessexpansion and the supply chain material shortages due to COVID-19, and identify the hazardsof the operating environment and manage the negative impacts of risk opportunities. For theoperating environment details, please refer to the Occupational Health and Safety section.

Employee
Labor

Risk Issues

Sexual Harassment
Privacy Rights

Emergency Preparedness
Occupational Safety

Mitigation

Recruit sufficient staff to meet production capacity needs and avoid overtime due toinsufficient workforce
Establish a working hour management mechanism system, and notify the overtime
employees and their direct supervisors with an early warning
Regularly review employee discrimination risks and keep the reviewing records to eliminate
discrimination violations
Strengthen the training and publicity of third-party contractor agency to ensure employees'
privacy rights
Strengthen human rights (including, but not limited to non-discrimination, sexual
harassment, and privacy) training and publicity, and reiterate relevant human rights
complaints and handling procedures

Disaster prevention safety education and training promotion and confirmation of evacuation
signs and emergency contact information are in place. For details, please refer to the
Occupational Safety and Health Training section
Organize environmental safety and health education courses and arrange on-site drills andtests for employees to enhance employees' safety awareness and emergency response
capabilities. For details, please refer to the Occupational Safety and Health Training section

Remediation
Measures

Enforce "After Continuously Working 6 Days, Need to Take One Day Off" management andtracking mechanism
Reward employee with quarterly incentive and annual bonuses, and provide additional
bonus to those who create surplus and outstanding performance
Provide activity space and vacation required by employees' religious customs, and revise
relevant management measures
About human rights related issues, use the reporting mechanism to complete theinvestigation process, track the effective implementation of disciplinary and counselingmeasures, and adjust the corresponding internal management mechanism andcompensation
Provide clinic physician consultation service to assist employees in psychological counselingand stress relief counseling

Regularly conduct emergency evacuation drills for fires, earthquakes and complex disasters,
review and revise preventive warning measures and drill results
Provide on-site physician consultation to assist employees in health management,
assessment and maternal protection consultation, and assist in applying for medical
insurance compensatory

Grievance Mechanism

91

Working Hours
Non-Discrimination

Health & Safety

USI provides internal reporting channels: including human resources mailboxes, employee complaint lines and reporting mailboxes in all facilities

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Management

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and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Human Rights Training

Employee Rights

Employee Unions

USI continuously pay attention to human rights protection
issues, promote relevant trainings, and enhance human rights
protection awareness to reduce the possibility of relatedrisks. Every year employees in all facilities around the world
are requested to take "Employee Code of Conduct" and"Humane Treatment in the Workplace" courses to know thedefinitions and requirements of employee behaviors. And toensure employees really understand the relevant regulations,employees need to pass the online test. In 2021, the per capita
human rights-related training hours is 1.1 hours; the total
training hours is 35,313 hours; the total number of employees
who are trained reaches 30,902 (the resigned employees
are included). As a result, 100% of current employees havecompleted training on human rights issues.

Comply with the labor regulations in the country or
jurisdiction where the facility is located, and sign employment
contracts with all employees in compliance with local
regulations (the signing rate is 100%). When there is a majorchange in the company's operations and the employment
relationship cannot be continued, the company shall informin advance per local laws and regulations of notice period (1) tocommunicate with the affected employees and explain their
due rights and interests to them. In addition, the Nantou
Facility would cooperate with the Vocational Training Bureau
to provide training plans, collect information on employment
opportunities in the neighboring areas, and assist employees
in changing jobs.

USI respects employees' freedom of association.
Employees who have like-minded or interested partners
can independently form associations and can also freelyorganize and participate in trade unions to conduct
collective consultations in accordance with relevant laws
and regulations. USI will not interfere in any way with theestablishment, operation or management of the association.
The Company will maintain a smooth communication channel
with the trade union, implement the relevant matters of
the group agreement and the express regulations on thehealth, safety and hygiene of employees, so that both laborand management can abide by it and develop a stable andharmonious labor relationship. Now, Zhangjiang Facility,
Kunshan Facility and Mexico Facility have established tradeunions, and a group agreement is signed with the tradeunion. Employees participating in the trade union enjoy theprotection of the group agreement. The group agreement
coverage rate is around 63% (2). In 2021, with the Company's
proactive communication with employees, there were no
major labor disputes or work stoppages caused by strikes.

Human Rights Training Employee Headcountand Training Hours
37,29135,313

26,606

17,155

16,27330,902
27,30624,18816,9082017

19,7452018
No. of Employees

2019

2020

2021

Total Training Hours

All facilities have formulated employee work rules to ensurethat employees are aware of their relevant rights andobligations. For example, Nantou Facility clearly stipulates
various employee rights in the Employee Handbook, including
appointment, resignation, working hours, vacations, bonuses,
insurance and behavioral disciplines, and other requirements
and posts it on the company's internal website, bulletinboard or conspicuous place in the workplace. Each facility
has Recruitment Guidelines to define standardized operatingprocedures to select the most suitable candidates who arewilling to serve in USI without discrimination and difference,
to attract more diverse talents for the company. The purposeof "Measures for Humane Treatment" is to show a workplaceculture of safety, dignity, non-discrimination, mutual respect
and tolerance, and equal opportunities, and to protect all
employees from physical or mental harm while employees
conduct their jobs.
Note 1. Mainland China Facilities: employees should be notified at least 30 days inadvance; Nantou Facility: employees should be notified at least 10 days inadvance; Mexico Facility: employees should be notified at least 7 days inadvance
2. Group agreement coverage rate=Number of employees participating in the
trade union ÷ No. of employees at the end of the period ×100%

The Proportion of Employees Participating inTrade Union
32.9

31.7

%

%

23.5
%

24.0
%

6,350

5,900
4,363

4,435

2018

2019
No. of Employees in Unions

2020

2021
Join Rate92

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Management

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and Innovation

Value Chain
Management

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and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Employee Communication
USI actively build positive employee relations, and continue to build an open, trusting and smooth
two-way communication environment. In addition to arranging courses to introduce employees
how to express their opinions, the locations of employee suggestion boxes and how to fill in
relevant information in the option sheet, we also regularly hold supervisors' symposiums andlisten to employees' voices through meetings, channels, questionnaires in the form of instantfeedback, and take practical actions to promote the harmony of labor-management relations. Due
to COVID-19, based on the local government's regulations to limit the number of gatherings andthe consideration of employee health risk control, the method of face-to-face communication
with employees has dropped sharply. The company still held 116 employee communication
meetings (46 General Manager Symposiums, 22 Care Conferences for New Employees; 18 Care
Conferences for Foreign Employees; 30 Employee Feedback Conferences). Instead of that wedelivery messages to employees by produced a variety of different ways to strongly broadcast
communication messages, and we strengthen the promotion of internal and external reportingand complaint / complaint channel information when the messages are communicated.

●

General Manager (GM) Symposium●

Labor Conference●

Employee Communication ● Employee Relation Website● Employee Suggestion Box
Meeting● Instant Messaging Tools● Hotline● E-mail(WeChat)

GM Symposium(Zhangjiang Facility)

In 2021, there are 10 internal employee complaints, including 1 sexual harassment, 1
discrimination, 1 privacy right and employee frictions and violations of workplace disciplines.
After investigation and confirmation, the confirmed wrongdoing behaviors were punishedand announced following the employee code of conduct. For the parties (complainant andthe respondent) to communicate and coordinate, and to make responses, compensation, andimprovement actions, to provide employees with psychological, work pressure, career and otherconsulting services conducted by the on-site physicians. The case closure rate is 100%.

Employee Communication Meeting(Kunshan Facility)

Regular
Symposiums& Meetings
Employee
Engagement
SurveyInstant
Feedback
Channels

There are multiple diverse channels where employees can file their opinions, as listed in the chart
below. All suggestions would be passed to the corresponding responsible unit for a response. The
units then respond to and resolve each case. The case closure rate in 2021 is 100%.

Internal Opinion Electronic Employee
Employee
HR DedicatedEmployee
Response Pathway
Suggestion Box
Suggestion Box Suggestion Mailbox Complaint Hotline

93

Total

No. of Employee
Response

167

533

2

0

702

No. of Closed Case

167

533

2

0

702

Harmonious Labor Relations

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Management

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and Innovation

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Management

Environmental Protection
and Occupational Safety

SocialInvolvement

Inclusive
Workplace

Appendix

Talent Attraction and Retention
We believe that an inclusive work environment allows
everyone to feel respected and supported, making it easier
to find the best way to work, develop everyone's expertisearea and grow together. As USI expands its business, how
to create a multicultural workplace that integrates multinational cultures, accepts individual differences of employees,
and establishes a no prejudice against different ages,
genders, races, religions, nationalities, political parties orphysical disabilities workplace, and a diversified workplacefor employees to grow together is an urgent issue for USI.
Therefore, USI is investing a lot of efforts in the establishmentof workplace culture, women's participation in decisionmaking, and the job arrangement of disabilities employees.

Workforce Structure
As of the end of 2021, the six major manufacturing facilities
covered by this report have a total of 19,290 employees,
including 15,390 permanent employees and 3,900 temporary
employees. Divided by job category, including 1,091 inmanagement positions, 1,991 in administrative positions,
3,527 in technical positions, 12,681 in skilled positions; divided
by nationality, there are 18,677 natives and 613 non-natives;
divided by region, there are 12,743 employees in Mainland
China, 4,057 employees in Taiwan, and 2,490 employees in
Mexico. For other detailed classification information, pleaserefer to the Sustainability Data - Social A. Workforce Structure
table.

Employees Headcount

Permanent / Temporary Employees
19,29018,615

18,515

18,567

1,415

2,862

2,956

3,900

16%

20%

92%

15,653

15,65915,390

2018

2019

8%

17,152

10,216

10,184

10,012

55%

8,351

54%

8,503

2018

2019
Female2021

2020

Permanent

2021

Temporary

Total Employees

Geographic Distribution

Administrative
1,991

2,140
12%

2,830

10%

2,425
13%

2,521
14%

2,490
13%

4,057

3,754

3,796

73%

12,336

12,29812,743

66%

66%

2018

2019

2020

2021

15%

20%

21%

20%

18%
13,597

Management
1,091

80%

44%

45%

Job Category Distribution

Technical
3,527

84%

8,443

8,431

2020

Male

85%

56%

55%

46%

45%

10,847

15%

6%

66%

67%

Skilled12,681

Mainland China

TaiwanMexico94

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Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

The company pays attention to the employee workplace environment and is committed tocreating a gender-friendly work environment. With a diversified and inclusive workplace, so thatwomen can give full play to their strengths in the workplace. When women's physical conditions
change (such as pregnant), they are given adequate care in addition to regular follow-up visits
and health consultations. In terms of female employee employment, by the end of 2021, female
employees in all facilities accounted for 43.8% of the total number of employees; the numberof women in senior management positions increased by 4.7% over the previous year to 17.6%.
In terms of female senior management development and training, it is expected that the
proportion will reach more than 20% by 2026.

Environmental Protection
and Occupational Safety

Proportion of

2018

2019

2020

2021

45.0%

45.9%

45.3%

43.8%

23.6%

23.4%

23.6%

22.6%

26.4%

25.2%

26.2%

25.9%

23.7%

24.6%

23.5%

20.3%

Female in top management positions (3)

11.2%

12.8%

12.9%

17.6%

Female in revenue-generation function
management positions (4)N/A (6)

N/A

45.5%

47.9%

Female in STEM job positions (5)

N/A

N/A

22.3%

22.1%

Female in total employees
Female in management positions
Female in junior management positions

100%

100%

100%

29%
62
49
17
2019

26

32

2021
Total

41%
85

81

33%
2
1

12

110

84

29

2018
2020

Female

37%

29

51

47
28

95

100%

41%

39

Male

(2)

83
73

2018

(1)

Female in middle management positions

Distribution of Top Management Position (8)7977Appendix

Gender Diversity Indicators

We actively solve the employment problem of local citizens and people with disabilities acrossour facilities. USI provides 17,923 job opportunities around the world. 97% of employees are
local citizens where the factories are located. Over the years, the proportion of local employees
in management positions has increased to 80.4%. In addition, the Administrative Measures
for the Appointment of Disabled Persons has been set up and the competent work content is
tailored for persons with disabilities, so that those who work in USI have more sense of work
achievement. In 2021, 83 disabled persons were hired worldwide.

Employees with Disabilities (7)SocialInvolvement

Inclusive
Workplace26
42
100% 18
2

17
2019

100%
8

100%
4
2020

2021

Mainland China Domestic

Mainland China Foreign

Taiwan Domestic

Taiwan Foreign

Mexico Domestic

Mexico Foreign

Note 1. The junior management positions refers to section and subsection heads
2. The middle management positions refers to department heads
3. The top management positions refers to the division heads andabove
4. Revenue-generating functions: sales function, excluding support
functions such as HR, IT, and Legal
5. STEM refers to personnel with job functions related to science,technology, engineering and mathematics fields
6. N/A: There is no relevant statistical classification for that year
7. The 2020 data of employees with disabilities in the Nantou
Facility was miscalculated as numbers with disability weights
and has been revised
8. The proportion of domestic top management position ＝ No. ofdomestic top managers in the Facility ÷ No. of all top managers
in the Facility × 100%

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Management

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and Innovation

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Management

Environmental Protection
and Occupational Safety

Inclusive
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Appendix

Recruiting the Right Talents
USI recruits suitable professionals based on the operation and development goals and functions. The human resources recruitment
department adopts a variety of recruitment channels and employment models based on the reviewed and approved departmental
manpower demands. We openly recruit talents through multiple channels, such as campus recruitment, employee recommendation
programs, industry-university cooperation internship programs, corporate sharing sessions, online recruitment, and multimedia
recruitment. And then, it is planned according to the manpower needs of each facility and to establish the most suitable employment
relationship (such as full-time / part-time workers, regular / contracted workers, dispatch workers, or appointed professionals), andtreat all applicants without prejudice or discrimination. And use objective interview testing tools to screen candidates' occupational
suitability. In 2021, 17,923 people were recruited, accumulating the energy required for our continuous growth and innovative
research and development, so that diversified talents from around the world can give full play to their strengths and meet different
customers and diverse market needs.
USI actively establishes and promotes the 369 3-Stage Care for New Employees and provides training programs to guide new
employees to quickly integrate into the company, a complete welfare system and a comfortable and convenient working environment
and establishes good communication channels to care about the work and life of employees and hold a celebration party to enhance
employees' recognition of and loyalty to USI. In 2021, there are 4,040 new employees who have served for more than 90 days, and theoverall retention rate of the new employees is about 23%. We attach great importance to the employees' opinions. Over the years,
we have used employee satisfaction surveys and employee engagement surveys to understand employees' expectations and listen to
employees' voices. Moreover, we put forward improvement plans to increase employees' willingness to stay in USI.
By analyzing the termination reasons, we plan the recruiting strategy and propose retention plans to reduce employee turnover. For
example, in Nantou Facility, to retain outstanding skilled employees, those who are outstanding employees shall be selected every
month and rewarded with incentive bonuses. By the end of 2021, the retention rate of outstanding employees reached more than
95%, the turnover rate of direct employees (1) decreased by 13%.
The overall turnover rate of the company is 36%, and the turnover rate of indirect employees (2) is 18%; the turnover rate of direct
employees is 46% due to the unstable supply status of the supply chain and staged production needs caused by the pandemic. For
other detailed classification information, please refer to Sustainability Data - Social B. New Hires and Employee Turnovers.

Talent Attraction
and Retention

Recruiting
the Right
TalentsComprehensive
Compensation
System
Employee
Engagement
SurveyMulti-Faceted
Performance
Appraisal
SystemNumber and Ratio of New Entry Employees
109
89

95

%

%

%

19,13818,792
17,923
16,420

2018

2019

2020

No. of New Employees

2021

New Entry Rate

Number and Turnover Rate of Former Employees
48
%

42
%

34
%

8,426

Note 1. Direct employee (DL) refers to employees working
in skilled positions
2. Indirect employee (IDL) refers to employees
working in management, technical andadministrative positions

101

%

2018

7,838

2019

No. of Resigned Employees

36
%

6,301

6,878

2020

2021

Employee Turnover Rate96

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Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Number and Ratio of New Entry IDL Employees
27%

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

AppendixComprehensive Compensation System
USI sets up compensation system according to the following concepts

20%

Value Chain
Management

18

15

%

%

● Recognize employees' contributions to the Company, formulate the differences between each position, and maintainthe balance of paying salaries.

● Respond to employees' performances appropriately for encouraging employees and recruiting required talents.
● Provide employees fair and reasonable treatment and adjust the salary as responsibilities are increased.

1,531
1,220

2018

2019
No. of New Employees

969

1,210

2020

2021

New Entry Rate

Number and Turnover Rate of IDL Former
Employees
15
%

12
%

12

18
%

%

● Adjust flexibly with the human recourse market and the changes of organization.

USI abides by the requirements of local labor laws; there are no different starting salaries and rewards based on employees'
gender, religion, politics, and marital status. We provide employees with consistent salary standards and benefits through a fair,reasonable, and motivated salary assessment system. After reviewing employees' contributions and performance through a multifaceted evaluation system, outstanding employees shall be given reasonable and substantial returns that are monthly job bonuses,
equity incentive plans, employee stock option and profit-sharing plan. In addition, USI participates annually in well-known publicsalary surveys held by local business consultants and regional salary associations to evaluate the overall economic indicators andmarket salary standards, external competitiveness of talents, and labor market supply and demand conditions to promptly adjust
our offer to reflect market prices and enables employees to receive reasonable treatment and USI's overall compensation iscompetitive in the talent market.
In 2021, the company adjusted the basic salary of employees in each facility. The salary adjustment range of Mainland China
Facilities is about 6% to 16%, the Nantou Facility is about 2% to 4%, and the Mexico Facility is about 5% to 13%; so as tocontinuously retain the recruiting competitiveness in the labor market. The ratio of the standard starting salary of direct employees
to the local minimum salary is about 1.00~1.08 after calculation. The ratio of basic salary (1) and compensation (2) of female andmale (3) in each facility are shown in the following table:

1,165
855

2018

739

807

2019

2020

No. of Resigned Employees

97

2021

Employee Turnover Rate

Note 1. Salary refers to the monthly remuneration paid to the employees, including the basic pay, allowance, and bonus (ex. meal allowance, shift allowance, supper allowance,overseas expatriate allowance, position allowance, monthly work bonus, and full attendance allowance)
2. Compensation is the sum of salary and bonuses. Bonuses refer to non-monthly remunerations (such as three festival bonuses, profit sharing, job performance bonuses, andspecial bonuses)
3. Due to regional differences, there will be large differences in Mainland China Facilities' ratios

About this Report

Operation and
GovernanceTechnical
Position

Administrative
Position

Skilled Position

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Zhangjiang

Jinqiao

Shenzhen

KunshanNantouMexico

1.00

1.00

1.02

1.05

1.08

1.03

Ratio of basic salary offemale and male

0.75

1.12

0.80

0.96

0.82

0.63

Ratio of compensationof female and male (2)

0.62

1.22

0.84

0.98

0.73

0.61

Ratio of basic salary offemale and male

1.04

0.98

0.91

1.02

0.83

0.79

Ratio of compensationof female and male

1.04

1.00

0.95

1.00

0.79

0.79

Ratio of basic salary offemale and male

0.71

1.05

0.76

0.87

0.89

0.98

Ratio of compensationof female and male

0.67

1.13

0.77

0.83

0.87

0.98

Ratio of basic salary offemale and male

0.95

0.93

1.02

0.98

1.01

1.18

Ratio of compensationof female and male

0.95

0.92

1.02

0.97

1.03

1.14

Ratio of DL starting salaries
to local minimum wages (1)Management
Position

Sustainability
Management

Employee Privacy
In conformity with our principles of respecting and protecting employees' personal information, USI has established information
confidentiality management and data management systems for recruitment, performance appraisal, and salary informationand has full-time personnel to manage file confidentiality to ensure that the employee information is confidential, so that thepersonal privacy of employees is maximized. If the employee's personal information needs to be accessed in the work process, anapplication must be submitted in accordance with the regulations, and the application must be processed after the approval of thereviewing supervisor. For cases of stealing, leaking or tampering with employees' personal information and privacy in violation ofregulations, they will be dealt with in accordance with company regulations, and legal responsibilities will be pursued. In addition,
based on the salary confidentiality regulations, the company requires all employees to "not discuss or disclose their own or others'salary" and "not inquire about or comment on the salary of others". Any violation will be dealt with in accordance with the relevant
punishment regulations.
Note 1. Ratio of direct employee starting salary to local minimum salary = direct employee starting salary ÷ local minimum salary
2. Ratio of female to male salary / compensation = female salary / compensation ÷ male salary / compensation

Inclusive
WorkplaceSocialInvolvement

Appendix

Employee Benefits
Due to the USI's globalization, the cross-site and cross timezone communication has become more and more frequent.
We set up multiple working hours for the same shift basedon the principle of flexible working, to meet the needs ofthe working in different business hours or time zones. Dueto the need of family care or taking education, the individual
employee can apply for a change of working hours after
obtaining the approval of the supervisor.
"Emergency Management" is a must-have capability for acompany to operate sustainably. In order to reduce the riskof being unable to operate due to natural disasters, fires,
certifiable diseases and other factors, USI implements aremote work mode. By the "Global Remote Work Guidance",
employees can apply to work from home. USI provides
subsidies for the purchase of work equipment and meals
reimbursement. Taking the COVID-19 pandemic prevention
as an example, the company truly let employees takeresponsibility for self-work management and the actual drillof the supervisor's remote management mode and deduced
the Microsoft 365 software to ensure that the efficiencyof working environment is the same as employees work in
the office. In the remote work drill in the Nantou Facility,
the employee participation rate reached 63%, and about 60
employees subsequently applied for the long-term remote
work.
Simultaneously, considering the aspects of food, housing,education, entertainment, transportation, physical andmental health of employees around the world, the company
adjusts measures to local conditions, provides employeeswith considerate welfare systems and insurance plans,
provides facilities for physical and mental development,
and designs various activities to strengthen physical andmental adjustment ability. Formal and informal employees of
employment contracts can also achieve a balanced life with
their families while working.

98About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

AppendixComprehensive Welfare System
Bonus

Festival bonus, full attendance bonus, overtime wage and allowance, performance bonus, three festival gift certificates, birthday gift certificate, R&D incentive bonus, patent incentive reward,
employee seniority bonus (Mainland China and Nantou Facilities)

Holidays andLeaves

Besides national holidays, statutory leaves and the two-day weekend, there are some special leaves such as paternity leave (Mainland China and Nantou Facilities), pre-maternity leave (Mainland
China and Nantou Facilities), maternity leave, parental leaves (Nantou Facility), breastfeeding leave, period leave, paid sick leave, paid annual leave (1), welfare leave (2) (Mainland China and Nantou
Facilities), Indigenous holiday leave (Nantou Facility) and election voting leave

Insurance

Provide social insurance for employees in accordance with the laws, provide pensions and retirement pay, add commercial group insurance plans such as Employee Group Insurance, domestic andoverseas travel insurance (for expatriates and their family members to participate during conducting the oversea assignment), and life insurance (Mexico Facility)

Meals
Dormitory
Transportation

All facilities have an employee cafeteria, meal subsidy, and "Mom stickers" (3)Different types of dormitories are equipped with household appliances, air-conditioning, hot water, wi-fi, and furniture. USI pays for all full-time employees' housing accumulation funds and provides
housing subsidies
Cross-site shuttle bus, parking lots, and pregnancy priority parking (Nantou Facility)

LOHAS

Employee (domestic and foreign itineraries) travel, family days, parent-child activities, annual dinner party and lottery, birthday parties, sports meetings, singing competitions, and cultural andartistic activities
Diversified clubs: choir, basketball club, softball club, badminton club, bowling club, swimming club, Iron Horse (bike) club, jogging club, billiard club, volleyball club, yoga and aerobics club, USI
Toastmasters (English speech club), fishing club, outdoor camping club, photography club, volunteer clubSpecial activity facilities such as: worship room, computer network classroom, reading room, Muse and Creativity Center (fitness room)
Leisure facilities: basketball and volleyball court, badminton court, snooker table and table tennis table

HealthEach facility is equipped with a medical room and a breastfeeding room. USI provides full-time nursing personnel and professional doctors (contracted with hospitals) to provide services such as free
medical consultation and emergency treatment. Our employees have one free physical check-up every year. Moreover, various hygiene training sessions and seminars are held irregularly

Others

Wedding subsidies, funeral allowance for employees and dependents, childbirth subsidy, education subsidies and scholarships for employees and their children (Mainland China and Nantou
Facilities), hospitalization solatium / allowance for employees, hospitalization solatium for employees' families (Mexico Facility), communication expenses, care for workgroups, emergency subsidy,
pay for the residence permit / working permit for foreign employees
Convenient stores were established to provide employees payment (Mainland China and Nantou Facilities) and ticketing services; Sign preferential contracts with restaurants, shopping stores,preschool childcare services, and language learning institutions

Note 1. "Paid annual leave" is implemented according to local regulations. Mainland China Facilities: An employee who has been working for more than one year and less than ten years will have five days of annual leave; more than ten years and less than 20 years have tendays; more than 20 years have 15 days. Nantou Facility: An employee who has been working for more than six months and less than one year will have three days of annual leave; more than one year and less than two years will have seven days; more than two years
and less than three years will have ten days; more than three years and less than five years will have 14 days; more than five years and less than ten years will have 15 days; more than ten years will be offered with one additional day each year. Mexico Facility: Those
who have been working for one year will have six days; more than one year will have one day of annual leave each additional year (no more than 12 days in total); more than four years will be offered with two additional annual leave every five years
2. Welfare leave: It is regarded as a long-term reward in Mainland China Facilities. Employees who have served for more than two years will be provided with full-paid welfare leave ranging from 2 to 10 days according to their length of service; The time limit is to be usedwithin one year after the entry date; after one year of employment, employees are entitled to 7 days of full-paid sick leave for the whole year, and 7 days of full-paid sick leave for less than one year will be given according to the percentage of employment, which is
better than the 30-day half-paid sick leave stipulated by law
3. For pregnant employees who show the "Mom sticker" can get an extra portion of the meal99

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Employee Benefit and Subsidy
Subsidy Item

Subsidy
Recipients

Subsidy Amount(CNY)

Wedding Subsidy

236

95,861Childbirth Subsidy

180

145,200

7,884

3,188,638

Hospital Consolation
Subsidy

172

38,947

Condolence Payment

226

62,061

Emergency Assistance3

16,9568,701

3,547,663

Travel Subsidy

Total

Benefit Item

Beneficiaries

Three Festival Gift
Certificate

28,584Birthday Gift
Certificate

11,974

BenefitAmount (CNY)9,412,301
3,895,416

Employee Continued
Education Subsidy

382

444,070

Scholarships for
Employees' Children

5,049

2,760,919

Retirement Gift22

29,092

Employee Special
Coupon2,300

216,512

Total

48,311

16,758,310

Value Chain
Management

Environmental Protection
and Occupational Safety

SocialInvolvement

Inclusive
Workplace

Appendix

In response to the government's policy of encouraging childbirth,the company adjusts suitable work shifts for pregnant employees,
provides convenient parking spaces, extra meal benefits, andretains positions for those who apply for maternity leave.
Breastfeeding leave is given to those who are breastfeeding by
themselves after giving birth. If employees need to take care of
their family members for a longer period, they can also apply forfamily care leave or parental leave to take care of their family.
Employees in Nantou Facility are clearly given the right to apply
for parental leave in accordance with local laws. They can apply
for reinstatement after the need for childcare leave is cancelled.
The company also proactively reminds employees of the
expiration date of childcare leave. In 2021, due to the COVID-19
pandemic, the need for family care has greatly increased, so thereinstatement rate and retention rate did not
keep in 100%.

Parental Leave in Nantou Facility
Item

2017

2018

2019

2020

Employees qualified to apply for parental leavethat year (1)

77

149

219

Employees that applied for parental leave that
year

9

8

Employees expected to return from leave that year

9

Employees that returned from leave that year

2021
Male

Female

Total

298

197

83

280

16

23

4

30

34

8

15

14

4

21

25

8

3

11

14

1

16

17

Employees that returned from leave the previous
year

5

8

3

11

5

9

14

Employees reinstated in the previous year andcontinued to work for more than one year

5

8

3

11

3

8

11

89%

38%

73%

100%

25%

76%

68%

100%

100%

100%

100%

60%

89%

79%

Reinstatement rate (2) for parental leave
Retention rate

(3)

after back from parental leave

Note 1. Eligibility for parental leave in the current year: those who have taken "paternity leave" or "pregnancy leave" (20 weeks or more) from 2016 to 2021 and are still working in 2021
2. Reinstatement rate: the number of people actually reinstated after parental leave in the current year ÷ the number of people who should be reinstated in the current year after parental leave × 100%
3. Retention rate: the number of people who were still employed 12 months after the childcare leaves in the previous year ÷ the number of people who were returned to work after the childcare leave in the previous year × 100%100

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Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Employee Retirement Plan

Work-Life Balance

USI and its subsidiaries provide pension and elderly insurance in accordance with the retirement laws and regulations of eachbusiness location. Employees who meet the statutory retirement conditions may apply for retirement to withdraw pensions inaccordance with the law. In 2021, 19 employees at the Nantou Facility applied for retirement, and 4 and 5 employees retired
at the Mainland China and Mexico Facilities respectively. To sum up the contributions of all facilities (1), USI has allocated CNY
192,429,296.31. USI's relevant retirement system is shown as follows:

Based on the three tenets of Health, Happiness, and Learning,
USI sponsors various clubs every year to organize various
activities and promote the physical and spiritual developmentof employees.

Three Main Themes of Employee Activities
NantouOld System:
In accordance with the Labor Standards Act, the retirement
provision fund shall be handed over to the Labor Retirement
Reserve Supervision Committee, and deposited into a special
account in the Bank of Taiwan in the name of the committee; eachyear, the actuarial assessment shall be conducted to determine
whether the balance of the special account is sufficient to pay
the estimated amount payable for the year, if there is insufficient
payment for possible retirement payments, the balance of thespecial account will be made up in the following year. The pension
calculation is calculated by multiplying the average salary of theemployee six months before retirement by the seniority base, and
2% of the total monthly salary of the employee is allocated to theemployee retirement fund.
2021 results: Retirement reserves totaled CNY 231,001,247.97 andthe ending balance was CNY 16,935,164.14.
New System:
According to the Labor Pension Act, the employer shall deposit 6%of the employee's monthly salary into the employee's personal
pension account monthly. Employees can choose to deposit 0~6%of the distribution ratio into their personal accounts and enjoy taxfree benefits.

Mainland
China
Practice:
Participate in endowment insurance plansestablished by government agencies as
required, pay monthly contributions tothese plans according to the corresponding
proportion of the deposit base, and allocate 8%of the employee's salary; employers contribute
15% to 20% of the salary.

MexicoPractice:
Open a retirement savings account for
employees according is required by the local
regulations and make contributions according
to the corresponding proportion of thecontribution base each month. The employee
contributes 2% of the salary; the employer
contributes 8% of the salary.

Note 1. All facilities include: Zhangjiang Facility, Jinqiao Facility, Shenzhen Facility, Kunshan Facility, Nantou Facility, Mexico Facility and other manufacturing facilities and businessoffices; for details, please refer to page 191 of 2021 USI Annual Report

101

HealthOnly a healthy body can create infinite
possibilities. By improving employees'
knowledge and environment of healthy life, theefficiency is improved and productivity doubled.

Happiness

The philosophy of happiness is the magic
wand to create win-win for a company and its
employees. If failure is the mother of success,happiness will be the father of success.
Employees get their passion and inspirationfrom happiness, whereas happiness is thespring of power that keeps employees going.

Learning

Learning keeps you young. Learning is totake care of employees for the rest of theirlives. Learning programs are developed for
employees' career development. Looking forthe fun of learning keeps life going and makes
employees willing to work harder.

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Management

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and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Employee Activities
To organize employees' welfare and activities and maintain harmony between labor andmanagement, the Employee Welfare Committee is established in Nantou Facility. The committee
members come from various departments. According to the proportion of the number of
departments, representative members were recommended or elected. By holding regularmeetings on a quarterly or monthly basis, the committee members exercise relevant functions andpowers in the meetings to decide on the relevant employee welfare policies formulated by the
Welfare Committee and hold various employee activities and implement and promote employee
welfare in accordance with the resolutions. Through the operation of the Welfare Committee,
cooperate with the association to hold relevant interesting activities, or participate in public
activities, so that more employees and their families can participate in the grand event, and realize
the purpose of cultivating useful skills in life. It has not only brought joy to employees but also
cultivated teamwork, promote a harmonious work atmosphere, and enhance work efficiency.
USI attaches great importance to employees' health, actively promotes employees to establish
exercise habits, subsidizes the establishment of 45 various clubs, plans and improves various
facilities, and regularly organizes various competitions. In 2021, a total of about CNY 1 million wasgiven for the 111 employee activities, with 45,957 persons participated in the activities. At thesame time, employees are encouraged to interact with other employees of the same interests
through club activities to balance their work and life.

29 Health &LOHAS clubs
14 Arts & Culture clubs
2 Community
Service clubs

111

33 Sporting Activities
78 Other activities,
such as celebrity
lectures, andDIY activities.

Fun Table Tennis Game

Badminton Game

Arts and LOHAS: Provide employees with various arts and cultural activities topromote personal exploration and growth of the body, mind, and soul

45 Clubs

Employee
Activities

Sports Competition: Employees can strengthen their physical fitness, improvetheir own skills, and enrich their cultural life through physical exercise,techniques, training, and competitive competitions

45,957

Participants
5,914 Sporting
Competitions

Singing Contest

Creative Lantern Activity102

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Management

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and Innovation

Value Chain
Management

Energy Supplement: Provide employees with various lectures and appreciation.
In addition to the improvement of self-energy, they can also obtain knowledge
supplements in other fields

Safe Production MonthMini Farmer's Market and Lectures

Birthdays and Festivals: Hold birthday parties for employees every quarteror expand them in conjunction with festival parties. Send warm wishes to
employees and demonstrate the company's humanistic care

Mid-Autumn Festival DIY Activity

103

Birthday Activity

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Volunteer Ambition: Encourage employees to show their talents and participate
in social welfare activities voluntarily, so that employees can achieve self-growth,enhance personal ability and experience, and help groups in need of assistanceAccompanying People with Disabilities

Beach Cleanup Activity

Thanksgiving Season: Create an atmosphere of mutual gratitude and gather eachother's centripetal force

Anniversary Event

Internship Programs

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Management

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and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Employee Performance Appraisal and Developmentwith higher responsibilities and relatively more advantageous salary remuneration. We hopeto help employees reach their personal and organizational performance targets, stepping
forward to the integral goals set up by USI.

Planning●

Execution

The evaluation items include working objectives and competency review. Competency includes
professional skills, learning and application ability, soft skills, and work attitude. USI provides
rewards, training, and various career development opportunities based on employees' performanceappraisal result. For those with outstanding performance and development potential, USI proactively
promotes and trains them through an open and transparent promotion pathway and provides themSet Goals andWorking Plans

Application

Through a fair and sound performance management system, USI links the Company's overall strategic
objectives with employees' individual work objectives and performance measurement standards.
Each permanent employee must set personal performance goals after discussing with and receiving
approval from the supervisor at the beginning of the year. During the work execution process, thesupervisor will provide consultation, counseling, and incentives to employees to complete theassignment. At the end of the year, according to the achievement of various performance goals, inthe form of an evaluation committee, the upper-level supervisor, the supervisor of the upstream anddownstream units of the business colleagues and customer opinions, the judges will jointly evaluate
the performance of the personnel from multiple perspectives. Development advice for employees
and forced rankings are required to be provided in the Performance Review Meeting. In 2021, 6,225
employees conducted multi-faceted performance appraisal.

●

Promotion
Nomination●

Salary Incentive●

Career Development

Appraisal●

Review and Followup Adjustments●

Coach and
Motivation●

Evaluation System●

Performance Review
and Feedback●

Individual
Development Plan

Employee and Distribution of Taking Regular Performance Appraisal and Competency Review (1~2)
Performance Appraisal
GenderPositionManagement Position

Male

FemaleNumber of Employees

No. of Employees Taking
Performance Appraisal

Competency Review
Percentage of Taking
Performance Appraisal

Number of Employees

No. of Employees
Taking Review

Percentage of Taking
Review

828

828

100%

828

794

95.89%

2,695

2,695

100%

2,695

2,695

100.00%

605

605

100%

605

605

100.00%Skilled Position

3,707

3,707

100%

3,707

3,707

100.00%Subtotal

7,835

7,835

100%

7,835

7,801

99.57%

Management Position

245

245

100%

245

244

99.59%

Technical Position

619

619

100%

619

619

100.00%Technical Position
Administrative Position

Administrative Position

1,233

1,233

100%

1,233

1,233

100.00%Skilled Position

4,887

4,887

100%

4,887

4,887

100.00%Subtotal

6,984

6,984

100%

6,984

6,983

99.99%

Total

14,81914,819100%

14,81914,78499.76%

Note 1. Qualification of Performance Appraisal and Competency Review: The employee who have assumed post for three months or more during the assessment period. However, those who haven't passed the probationary assessment, or those on leave without pay forover three months are not listed in the name list to do the performance appraisal and competency review
2. Vice president and above do not file their competency review in the system

104About this Report

Operation and
Governance

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Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Employee Engagement Survey
Surveys and studies over the years have proved that highly committed employees will havean emotional connection with the organization or team. They actively participate in company
activities, are willing to work and are willing to devote more effort to make suggestions for
improvement, so that the work can be carried out more smoothly. At the same time, they
are also willing to share their work experience with others. Therefore, employees' input has apositive impact on employee retention, productivity, sales growth, and customer satisfaction.
To understand how well the employees fit in with USI, we have initiated the first Employee
Engagement Survey in partnership with expert consultants in 2017 and continue to conduct
biannual surveys ever since. We hope that this can help us effectively understand and collectemployees' opinions and use it as a policy tool for attracting, retaining, and cultivating talents.
Thus, achieving a win-win situation between USI and employees.
In 2021, based on the results of 2019 survey feedbacks and the 2020 WW Engagement Survey
Workshop conclusion, USI continually conducts follow-up action plans on senior executive
management leadership, company branding and image, talent development and deployment,
and sufficient and efficient work resources to improve employee engagement goals.

Employee Experience

In 2021, the design survey is expanded from the original 15 aspects of 2 levels and 6 dimensions
to a total of 18 aspects of 3 levels and 6 dimensions of employee experience to survey
employees' opinions. The new survey added Sustainability index (sustainable dedication,
retention, ESG) to listen to employees' voices more effectively, so that the company's processes,
strategies, and measures can be closer to the employees' expectations to achieve the goalof attracting and retaining talents. This 14-day employee engagement survey was conducted
on 14,998 direct / indirect employees who arrived on the job before June 30, 2021. A total of
13,350 valid questionnaires were collected. The effective response rate of the questionnaire was
89%, and the overall employee engagement score was 84%. Compared with the survey results in
2019, the IDL effective response rate increased by 1.5% compared with that in 2019. The resultsof the comparison of the various item scores shows that the company's actions to listen to thevoices of employees are deeply recognized by employees and employees are more willing to
speak up.

Sustainability Indexes

Engagement Behavior

Sustainable Engagement

105

PurposeWork

RewardPeopleInspiration

Drive

GrowthTrust

Inclusion

Voice

Capability

Collaboration

Understanding

Organization

Fair Pay

SupportEngagedEnabledEnergized

Retention
Pull force
Push force

ESG

Environment
Society
Governance

Employee
Behavior

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Management

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and Innovation

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Management

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and Occupational Safety

SocialInvolvement

Inclusive
Workplace

Appendix

Human Capital Development
Employees are important assets of USI. They are also the spirit of andmotivation for the Company to progress and grow. Therefore, USI has
been devoted to investing talents and created a learning organization
culture to providing employees the most appropriate resources andeffective learning models, helping them to enhance themselves andshow their value in relevant expertise.

nt
pm
e
ship
der

n

atio

tiﬁc

Dev

Cer

Senior Engineer / Administrator
Middle Training

Engineer / Administrator
Basic Training

New Employee
Orientation

USI Camp

Division Mgr.
UMBA (1)eloon

USIU provides a holistic learning and development framework for
employees to actively retain talents, by strengthening "Dual Career
System" of management and professional positions. With a mission ofrealizing high operational performance, USI establishes an innovative
learning environment and is committed to improving the employee
professional quality, leadership management and innovative researchand development capabilities inside the organization. It has targeted
employees with different competences to plan various employee
training and courses, provide them a complete learning platform,
help them to solve work issues, and enhance their professional
capability to reach organizational targets.

Staﬀ Engineer / Administrator
Advanced Training

iti
Pos

Through diversified educational training, USI helps its employees
cultivate professional abilities and grow, and improve in learning
effectiveness. The most important learning and development systemin the USI cultivation program is USI University (USIU). USIU sets up"College of Management, College of Technology, College of Quality,
College of Manufacturing, and General Knowledge Center". The USIU
President is served by the president, and the deans of the colleges
and General Knowledge Center are respectively served by the vicepresidents with prestigious and professional knowledge in each field.
USIU integrates global learning resources for employees to learn anddevelop.

Executives

Technical / Prof. Manager
Expert / Lecturer

Lea

Dual Career LadderCompetency

Department Mgr.
MTP (2)
Section Mgr.
MIT (3)
Supervisor
TWI (4)

USI University

COO's
Communication

Tech./ Mgmt.
Forum

USI Motto " Realizing IDEAS Together "Note 1. UMBA, USI Master of Business Administration, Courses for Division heads
2. MTP, Manager Training Program, Course for Department heads
3. MIT, Manager Initial Training, Courses for Section heads
4. TWI, Training Within Industry for Supervisor, Courses for Section heads

106About this Report

Operation and
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Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Appendix

Diversified Channels and Platforms of Learning

Employee Training Hours

USIU provides employees with all-round training courses that talents need to take. It offers not only diversified training content but
also designed the training methods and relevant activities based on the different course category. The courses include training in
the classroom, e-learning training, on-job training, and external training. These courses enable employees to learn and continuing
education in a more efficient and flexible manner. Under the multiple learning models and a precise and solid training framework,
we plan internal and external training and build diverse, innovative learning channels to inspire employees to grow continuously.
So, more employees can show the training results through the process reengineering, research and development achievement,
project execution, and innovation, and apply what they have learned to practice field of work.

In 2021, our total training hours reached 592,663 hours,
and on average, every employee was trained 30.7 hours (1).
The training statistics for each employee category are as
follows:

Vision & Mission
Self-learning

Competence

Study (Books, Journals, Network…etc.)

Core Competence

External Training, Lecture, Seminar

Management CompetenceOn-the-Job Training
Professional Accreditation

e-Platform
LMS, Global OA,
SOP, DMP, PDM

CollegeCollege of Management

OJT

College of Quality
College of Manufacturing
General Courses

2021
Category

Total Training
Hours

Average
Training HoursMale

377,78934.8

Female214,874

25.4

Management
Position

28,306

25.9

Technical Position

98,49727.9

Administrative
Position

42,023

21.1

Skilled Position

423,837

33.4

New Employees

288,203

16.1

All Employees

592,663

30.7

22.3

Director Training

21.9

31.0

30.7

577,370592,663

2020

2021

22.6

SOP Training

College of Technology

Internal E-system
Professional Knowledge and Skill
Internal Sharing Study

Motto : Realizing IDEAS Together
Note 1. Average training hours ＝ The actual total training hours of employees of this category / gender ÷ the number of employees of this category / gender at the end of the period

107

SocialInvolvement

Inclusive
Workplace

367,602405,791

417,860

2017

2018

2019

Total Training Hours

Average Training Hours for Per Employee

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Management

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and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

The breakdown for different training topics is shown in the following chart. The total training cost exceeds CNY 28.9 million. For
details, please refer to Sustainability Data - Social G. Training Hours and Training Cost.

Environment

Health and
SafetyHuman
RightsGreen
Product

Business
EthicsTotal Training Hours

17,486

34,66435,31318,713

12,418

8,166

7,881

No. of Employees

23,75419,75330,902

17,47622,485

9,985

8,381

0.7

1.8

1.1

1.1

0.6

0.8

0.9

Training Topics

Average Training Hours

Enterprise Risk Cybersecurity

Appendix

2021, it has already had the ability to certify three types of jobs
(as special installation and adjustment electronic equipment
technician, debugging broadcasting and communicationequipment technician, and electronic installation in broadcasting
and communication equipment technician) and four levels of
qualifications for junior, middle, high, and advanced technicians.
As of 2021, a total of 157 junior technicians, 311 intermediatetechnicians, 353 senior technicians, 90 advanced technicians. 911
skilled workers have been trained in total.

Internal Instructor Training Program

Tailored Career Plan
Strengthen Employee Sustainable Employment Ability and Lifelong Learning
Program
In an era of ever-increasing demand for comprehensive talents, professionals with merely one skill are no longer enough to meet
the working requests. USI has, therefore, continuously enhanced employees' sustainable employment ability, assisted employees
doing acquiring skill and ability management and lifetime learning programs that are required for a job transfer in the future.
Starting from 2018, a total of 133 employees have been supported to obtain academic qualifications / degrees, and a total of 73
employees have been supported to obtain academic qualifications / degrees in 2021. The categories of employees' degrees andtheir majors are shown as follows:

Category

High School
Program

Vocational School
Program

College Program

University Program

Master Program

No. of employees

16

37

2

15

3

N/A

Early Childhood Education,
Administration,
Visual Communication
Design, Logistics
Management

Environmental Art
Design, Business
Administration

Information
Engineering, Logistics
Management,
Industrial Engineering,International Trade

Mechanical andElectrical Engineering,
Finance, Human
Development

Major

SocialInvolvement

Inclusive
Workplace

In addition, since 2018, USI's Zhangjiang Facility, Kunshan Facility and Mexico Facility have invited local colleges or universities tocooperate and hold in-house academic degree courses in the Facility, so that employees can avoid the trouble of commuting andmake the best use of their time to get a high school, college or university diplomas / academic degrees. As of the end of 2021, there
are a total of 14 classes, and 411 employees are taking their further education as on-the-job training. For details, please refer to
Sustainability Data - Social H. Degree programs Offered by Local Schools in Cooperation with USI.
In terms of professional skills certification, USI promotes the job certification system, and establishes an inspection mechanism forthe professional ability that each position should have, so that employees in the same position have a certain level of professional
skills. For example, in 2019, Kunshan Facility became the first batch of high-skilled certification enterprises in Jiangsu Province. In

For many years, USI has trained and certified employees throughthe internal instructor system to serve as lecturers, forming
a good knowledge inheritance culture, and giving full play tointernal human resources and influence to provide employeeswith high-quality and forward-looking courses to cultivate worldclass talents for the Company to enhance the Company's global
competitiveness. As of the end of 2021, due to the impact of the
COVID-19 pandemic, many courses cannot be held as scheduled in
the classroom, and the need for employees to work remotely has
increased, so converting the training to an e-based curriculum isrequired for a comprehensive planning. Therefore, the number ofcompleting internal instructor program is only 867 in 2021.

833

867

733
661

608

586

523

453

580

414
208

2017

210
2018

Male

194
2019
Female

247
2020

287
2021

Total Internal Instructor108

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Appendix

Talent Cultivation in the VUCA Era
VUCA is currently the most discussed word in the management world, representing Volatility,
Uncertainty, Complexity, and Ambiguity. Although the current world situation is changeable,
uncertain, complex and ambiguous, in order to prepare for such a chaotic environment inadvance, a new attitude and thinking is needed. VUCA 2.0: Vision, Understanding, Courage, andAdaptability are the new and positive attitudes to cope with future changes.
Cultivating talents in the VUCA era requires talents to build new capabilities by accumulating
different practical experience, cross-border experience, and using "role swap" to allow
employees to move between different roles and teams according to their personal careerdevelopment goals and organizational development needs. The launch of the talent training
plan will lead those who are at the helm who are striving forward in the turbulent waves to tap
their potential by constantly accepting challenges, try multiple cross-border development tocultivate a comprehensive perspective, and jointly create a stage full of a sense of belonging
and achievement. Therefore, based on the greatest intersection of the three cores of "personalability, personal interest, and organizational needs", we establish a personal development
planning management mechanism, and build an employee-led, boss-assisted, and jointly
formulate employee's personal structured career development and growth plan, let the program
helps employees achieve individual development goals that are in line with USI's strategic
mission and goals. At the same time, employees' development in various functions is improved
through the leadership and management forum held every quarter, and through the informationand knowledge sharing and exchanges of well-known leaders in the industry and colleagues.

Personal Development Plan Process

Evaluation & Adjustment
Implement
Development Plan
Self-Assessment●

Conﬁrmation●●

Self-Reﬂection & Career
Exploration● Goals Identiﬁcation andDevelopment●

Self-Assessment Using
SWOT (1) Analysis
Build a Win-Win Strategy

Note 1. SWOT, Strengths, Weaknesses, Opportunities, and Threats
2. SMART, Specific, Measurable, Attainable, Relevant, Time-Based
3. The 70-20-10 Rule, Learning by Doing - Learning from Others - Learning by Curriculum

109●

Formulate Annual SMART (2)Goals
The 70-20-10 Rule (3)●●One Small Step a Day;
Self-Reﬂection●

Seek Feedback and Support●

Face Obstacles●

Commitment andMotivation●

Follow-up, Sharing &Feedback, Consultint andListening
Recording, Adjustment &Continuous Improvement

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Appendix

Hackathon Activity
Hackathon is a compound word of "Hack" and "Marathon",which is used to refer to a "marathon-style technology
creation event"; and the activities for the event are carried out
by team members for the project. The essence of a hackathon
is to form teams of people with different backgrounds and use
creativity together to solve difficult problems in various fields.
Team members do not necessarily need to have a backgroundin programming, and the main axis of the competition also
focuses on solving problems with new ideas.
The company's inaugural hackathon was "Anywhere forEverywhere," leveraging Microsoft 365 deployments toencourage employees to form cross-functional teams andparticipate in this fun event. Since, this is a global event,instead of a live match, the event was held virtually by using
Microsoft Teams.
The competition is divided into a preliminary round and a
final round. There are training courses and consulting services
provided by Microsoft and Acer. Due to time constraints, 15
teams were selected in the preliminary round, and 6 teams
participated in the competition in the final round. The scoring
criteria are practical application (35%), creative idea (25%),
technical application (25%) and presentation (15%).

Winning Team

Second Place
God Divination

Design Concepts
Create a question-and-answer
robot to solve the daily problemsof the OA system and the realtime monitoring system (Shop
Floor Information System, SFIS)
in production line

Champion
Breath of Water

Create a line balance rate for
uploading System Assembly(SASM) part numbers andconverts this data into graphs
and tables to reduce operator
workload by up to 65%

Third Place
Explode before
the Deadline

Create a pre-alert system
to ensure completion of tax
payment and customs clearancein time110

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Social Involvement
To manage our relationships with our surrounding communities and the environment, USI actively engages in corporate citizenship through external participation and four
approaches: Investing in Education, Contributing to Society, Conserving the Environment, and Promoting Arts & Culture. Together, we can create social value and build asustainable future.

3.83
107,833
1,415
1,717
1,050
335.2
CNY

Million Invested in Social Involvement
Trees Planted in the Million Tree ProjectStudents Participated in Industrial-Academic
Partnerships
Volunteer Hours Contributed to Local Communities
Students Reached through 5 Rural Revitalization
Programs
kg Trash Picked from 2 Coasts

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and Occupational Safety

Key Performance and Targets
SDGs

Business Action

Invest in rural
education and youth
capacity building tobridge the city-country
education gap and raiseyouth employability

Actively participate incommunity activities,
invest in community
development, and carefor vulnerable groups

Strengthen
environmental
protection awarenessand mitigate
environmental impact

KPI

2021 Target

2021 Performance

Investing in
Education

Rural area reading
activities
Number ofindustrial-academic
partnerships
Number of interns
Number of USIU
classes shared

Hold 6 reading
activities in rural
areas
Conduct 2 researchindustrial-academic
partnerships
Admit 30 interns
Share 30 USIU
classesNumber of people
benefiting fromrural revitalization
programs
Number ofvolunteers
Number of artgroups supported
Number of trees
plantedAmount of coastal
trash picked
Number ofenvironmental
seminars held

Promoting Arts &CultureConserving theEnvironment

SocialInvolvement

Achieved

2021 Key Issue

Contributing toSociety

Inclusive
Workplace

StatusAppendix

Not Achieved (1)2022 Target

2026 Target

3 reading activities
held in rural areas
3 researchindustrial-academic
partnerships
conducted
56 students
interned in USI
19 USIU classes
sharedHold 6 reading
activities in rural
areas
Conduct 2 researchindustrial-academic
partnerships
Admit 60 interns
Share 30 USIU
classes

Hold 6 reading
activities in rural
areas
Conduct 2 researchindustrial-academic
partnerships
Admit 150 interns
Share 40 USIU
classes

Support 900 rural
students
Set volunteer
management policy
Support art groups

1,050 rural students
supported through5 programs
Set volunteer
management policy
2 art groups and 4
artists supported

Support 1,000 rural
students
Reach 500
volunteers
Support 2 artgroupsSupport 1,200 rural
students
Reach 2,000
volunteers
Support 3 artgroupsPlant 7,500 trees in
employee forest
Hold coastal
cleanups
Hold environmental
seminars

7,864 trees planted
in employee forest
2 coasts cleaned
and 335.2 kg oftrash picked
1 environmental
seminar held

Plant 8,000 trees in
employee forest
Hold coastal
cleanup and pick
300 kg of trash
Hold 2environmental
seminars

Plant 8,250 trees in
employee forest
Pick 1,000 kg oftrash
Hold 5environmental
seminars

Note 1. For unachieved targets, please refer to the corresponding sections for relevant explanations and future improvement plans112

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AppendixSocial Activities Overview
As a corporate citizen, we believe that social involvement is more than monetary investments.
Our contributions should be anchored in sustainable development and contribute to community
development, making a positive impact. As the top management for Social Involvement, theSustainability Committee established our Public Affairs Engagement Policy and Corporate
Volunteer Regulations to systemically manage and focus our strategic direction. We encourage
employees to volunteer in social activities that align with our four approaches: Investing in
Education, Contributing to Society, Conserving the Environment, and Promoting Arts and Culture.
The complete Public Affairs Engagement Policy can be accessed on USI website (https: // www.
usiglobal.com / en / csr / Social-Involvement).

To measure the social value of our programs, we adapted the London Benchmark Group (LBG)
framework and Social Return on Investment (SROI) methodology to effectively quantify our
corporate citizenship and philanthropy investments. We hope to make better decisions, be moreaccountable, and maximize the effectiveness of each program by evaluating our inputs, outputs,
and impact. USI invested CNY 3.83 million in 68 social activities and 40 external organizations in
2021 and engaged 314 employees to volunteer 1,717 hours of service throughout the year.

The following figures show the ratio of CNY invested by type of approach (1), type of activities, and type of contribution (2) :Investment by Approach
12%

20%

20%

9%

8%

12%

46%

Investment by Type of Activity

42%

24%
14%

29%

87,973 93,820

5%
26%

2%

2%

485,536

38%
46%

12%

38%

13%

37%

50%

37%
49%

30%

17%

Investment by Type of Contribution

45%

37%

23%

49%
25%

3,341,216
84%

2018

2019

2020

2021

2018

2019

Percentage of Total Costs (%)
Investing in
Education

Contributing
to Society

Conserving theEnvironment

Promoting
Culture & Arts

2020

2021

Percentage of Total Costs (%)
Commercial
Initiatives

Community
Investments

Charitable
Donation

Note 1. External organizations participation costs are excluded from the social involvement four approaches
2. Total social investment costs are based on cash and in-kind giving. Volunteering time and management overhead costs are not included in the calculations

113

Unit: CNY
Cash
Contributions

In-Kind Giving

Time

Mangement
Overheads

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AppendixSocial Involvement Priorities & KPIs
Priority Alignment
with SDGs

Business Drivers

Business Benefit KPISocial / Environmental Benefit KPI

Investing in
Education

To expand our pipeline of high-tech talent, Investingin Education is the driving force for our growth. We
continuously invest in developing future humancapital through skill-based programs for potential
employees, enhancing youth employability.
2026 Goals:
Share at least 40 USI University courses
Accept at least 150 interns
Collaborate on at least 2 industrial-academic
research partnerships

Cultivate high-tech talents and develop innovativeelectronic designs and technologies.
2021:
Collaborated on 3 industrial-academic research
partnerships
Reduced false alarms and increased manual re-inspection
efficiency by optimizing automated optical inspection
machine learning for non-solder components
Reduced the layout time needed and errors made by
extracting key product specifications using natural
language
Increased production efficiency and yield rates andreduced labor costs by designing machine learning AI
models that detect defects in soldering across multiple
types of components

Enhance youth employability throughinternship programs and industrial-academic
partnerships.
2021:
Students that participated in industrialacademic research partnerships: 9Interns accepted: 56
Number of people that attended USI
University courses: 1,350
Schools with partnerships: 33

Contributing to Society is our long-term mission
to build and deepen our connections with local
communities. We harness internal and external
resources to infuse into socially marginalized areas,
becoming the force behind raising sustainablecommunities.
2026 Goals:
Support 1,200 underprivileged students
Have 2,000 volunteers

Increase employee engagement through volunteering insocial activities.
2021:
Volunteer hours: 1,717 hours
Number of volunteers: 314

Enhance well-being for vulnerable groups
within local communities, increasing social
inclusion.
2021:
Sponsored 42 Contributing to Society
philanthropic activities

Conserving the Environment becomes even more
important as climate change intensifies. USI adapts
our motto of Realizing IDEAS Together to our climate
action, raising awareness, acting, and finding solutions
to mitigate our impact on the environment.
2026 Goals:
Plant 8,250 new trees in the USI Employee Forest
Pick up 1,000 kg of coastal trash
Hold 5 environmental seminars

By continuously planting trees, we hope to increase theamount of carbon captured as part of our effort to mitigate
climate change.
2021:
Planted 7,864 new trees in the USI Employee Forest

Reduce environmental impact, improve
the quality of our living spaces, and raiseawareness for environmental conservation.
2021:
Cleaned up 2 coasts and picked up 335.2 kgof trash

教育

Contributing toSociety

Conserving theEnvironment114

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Appendix

Investing in Education
Talent is an important growth driver for enterprises. Reading is thegroundwork for accumulating innovative capabilities. As part of theInvesting in Education strategic pillar, USI helped establish the Taiwan
Reading Culture Foundation and its Philanthropic Library. The Library is
set up in each township as a resource for teachers to borrow and use
in class. We co-organized the Chinese Literary Prize for Global Youth toencourage students in literary pursuits. In terms of youth training, wehave several industrial-academic partnership and internship projects in
multiple facilities to enhance youth employability and develop the nextgeneration of technology talents.

Magical Physics Science Camp: Outcome
Incidences for Students

75%

73%

71%

Increased Science
Knowledge

Increased Interest
in STEM Subjects

Increased Science
Reading Motivation

Sponsor Taiwan Reading Foundation/ Nantou Facility /"Broadening children's horizons and cultivating reading interest" cannot
be done overnight. Therefore, USI has continuously sponsored the Taiwan
Reading Culture Foundation to build Philanthropic Libraries since 2005
and invested CNY 120,000 every year purchasing new books for the
Libraries. To date we have donated 725 boxes of books, developing thereading ability of students in rural and remote areas. We understand that
only continuous investment can bring substantial impact and change tostudents, and not just financial and material assistance.
In addition to book donations, USI collaborates with the Foundation to organize Parent-Child Reading and Magical Physics
Science Camp activities. We spare no effort to expand investment in local education, enhance reading habits, and promoteinterest in science. Due to COVID-19, Meet the Author activities in Lanyu were canceled in 2021. We plan to resume them oncethe pandemic subsides. 119 people participated in the Parent-Child Reading Activity. We hope to instill reading habits throughparents and children reading together, enriching children's minds. This year, we also initiated a Magical Physics Science Campfor upper grade elementary school students in Nantou. Through exciting experiments, the teacher introduced 32 students toFaraday and explored the wonders of physics from hands-on experiments.
We continued to use the SROI methodology to analyze and quantify our impact to students and children through thePhilanthropic Libraries program and activities. Through our survey, we found 75% students who participated in the Magical
Physics Science Camp felt their science knowledge increased and 73% increased their interest in STEM subjects. From theparents that participated in the Parent-Child Reading activity, 73% parents believed that the event could enhance family reading
quality, 72% believed that it could enhance their children's reading comprehension. For detailed analysis, please refer to thecharts on the right. In total, every $1 invested in the Philanthropic Libraries can generate $3.88 of social value.

115

Parent-Child Reading: Outcome Incidences for
Parents and 1st-3rd Graders
1st-3rd Graders

Parents

77%
72%

77%
73%

72%

71%

74% 73%65%

Improved Family
Reading Quality
2019

Improved Reading
Comprehension
2020

Improved Reading
Focus
2021

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Appendix

Sponsor Chinese Literary Prize for Global YouthUSI University Courses & Industrial-Academic Partnerships/ Nantou Facility // Zhangjiang, Shenzhen, Kunshan, Nantou, Mexico Facilities /The Chinese Literary Prize for
Global Youth is known as thefountain of living waters for new
literary talents. Many literary
luminaries such as Chang ManChuan, Jian Zhen, and Hou
Wenyong had won this prize as
students. To encourage student
participation and advance Chinese
literary culture, USI sponsors CNY
70,000 every year as prize money to scout for new literary stars. The call for
manuscripts has expanded to include Chinese students from all over the world.
In 2021, the 39th Global Chinese Student Literature Award received 1,150 entries,
mainly from Taiwan, Mainland China, and Malaysia. There were 753 submissions
from Taiwan and 397 from overseas. 420 schools submitted entries into thecompetition. The Global Chinese Student Literature Award, co-sponsored by
Mingdao Literature and Art Magazine, Mingdao Middle School, and Modern
Literature Museum, is a cradle for literary talents in the Chinese region. We lookforward to more award-winning students emerging in the Chinese literary world.

Over the years, USI focused on internal employee education and training. Internal lecturers from USI University
cooperate with industrial guilds, associations, and universities provided several free courses to share theirknowledge, experience, or the industry's latest trends to associated organizations and students. Throughcourses such as Highly Skilled Talent Development and Management and CIP Smart Manufacturing Application
Management, we share our experiences with industry peers. Also, we share research results and knowledge inuniversity seminars, such as 5G mobile communication and RF design and user scenario and data analysis souniversity students can be exposed to practical applications of theories. Due to the pandemic, we only shared
19 courses, 2,343 hours of lessons in 2021. In the future, we will continue investing in the education of youth
capacity training once the pandemic eases up.
Also, to put academic theory into practice, USI provides internship opportunities in Shenzhen, Kunshan, Nantou,
and Mexico Facilities. In 2021, 56 students interned in our internship programs. We designed a one-on-one
mentor system so students can bridge the gap between school and work after graduation.
In addition to internship opportunities, Nantou Facility continued to partner with National Chiao Tung
University. In 2021, we invested CNY 710,000 to implement various research projects such as Cross-Component
Short Circuit and Tin Defect Detection, Non-Solder Automated Optical Inspection Optimization Model for
Machine Learning, and Extracting Key Product Specifications Using Natural Language. The Cross-Component
Short Circuit and Tin Defect Detection research won in first place in the International ICT Innovative Services
Awards 2021. In 2021, 1,415 students benefited from these industrial-academic partnership programs andparticipated 42,582 hours.

USI University Courses (Global)
Zhangjiang
Facility●Work Experience Sharing●

Production Introduction●

Product Line Introduction●

Experience Sharing(Shanghai Tech School, Hubei Tech
School)ShenzhenFacility●

Career Planning (Henan
University, Henan Polytechnic
University)● Intro to RBA (Contractors)

KunshanFacility

NantouFacility●●

AI Powered Visual Inspection (TEEMA)● Highly Skilled Talent Development andManagement (Qiandeng Labor Oﬃce)● Quality Training and Management(Suppliers)

Seminar - 5G Mobile Communication and RF Design(National Cheng Kung University)● Seminar - User Scenario and Data Analysis (National Sun
Yat-Sen University)● CIP Smart Manufacturing Application Management (TEEMA)● Team Communication and Coordination Skills (Nankang
Factory Association)

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Appendix

Contributing to Society
Rural Revitalization

Western Region Student Aid Program

In response to SDGs (Goal 1: No Poverty; Goal 4: Quality Education), USI sponsors several
educational rural revitalization programs to help children in impoverished regions obtain
resources for quality education and narrow the gap between urban and rural areas. For example,
in 2021, USI invested CNY 216 thousand and assisted 1,050 students by funding the Rural Digital
Education Program, Western Region Student Aid Program, Hope for Pearls Project, Kunshan Care
Package and Heartfelt Wish Activity, and the Huanghe Jiaotong University Aid Program.

/ Zhangjiang Facility /Rural Digital Education Program

Education is the pathway out of poverty as it can help people gain comprehensive capabilities
and utilize advanced technologies. Therefore, USI carried out the Western Region Student Aid
Program through the Cihui Foundation in rural western regions such as Yunnan and Sichuan
and invested CNY 48,000 to provide financial aid to 12 impoverished outstanding college
students to ensure their opportunities for education and growth. We believe when they
complete their studies, they will use the knowledge learned to help more people.

/ Zhangjiang Facility /Huanghe Jiaotung University Aid Program

The United Nations believes that higher digital literacy inthe digital age is needed to prevent marginalization insociety which is an essential task of rural revitalization.
USI upholds our value of Realizing IDEAS together
and implements our sustainability policy of actively
participating in community activities and focuses on thecomputer education gap of schools in remote areas. We
launched the Rural Digital Education Program and donatedcomputer classrooms to improve their learning environment, enrichteaching resources, and enhance students' abilities. The five computer classrooms we donatedare in Gansu and Qinghai. The classrooms hold 150 sets of computers and benefited 961
students in 2021, and the cumulative beneficiaries reached 1,674.

/ Zhangjiang Facility /In 2021, we continued to follow up on the usage of the computer classrooms and organized ateam of professional social workers, technical staff, project leaders, and local rural revitalization
workers to visit the schools and interview the teachers. From our field interview insights, wewill arrange computer training courses so rural teachers can conduct computer lessons moresmoothly in 2022.

USI donated CNY 50,000 to supply 7 impoverished
Huanghe Jiaotung University Electrical and MechanicalEngineering students with computers for their studies.
Due to family finances, these students don't havepersonal laptops and couldn't put their studies into
practice. We hope our support can serve as a starting
point for these university students in the technology
industry, so that they can keep up with their studies, andhave more possibilities in the future.

Hope for Pearls Project/ Shenzhen, Kunshan Facilities /Since 2016, USI has actively participated in the Hope for Pearls Project, helping students withexcellent grades but cannot afford tuition to actualize their dream of finishing high school.
In 2021, we held a "Walk for Pearls", where 100 USI employees and their families walked
to promote the Hope for Pearls Project. We raised CNY 100,000 for Qianshan Yezhai Middle
School in Anhui Province and set up the fifth USI Shueijin Pearl Class with 40 students. In
addition to funding, we continued to follow up on these pearl students and support thememotionally and spiritually.

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AppendixSocial Inclusion
With our love and support, USI Shueijin Pearl Class of 2018 in
Chongqing Jianshan High School and Luoyang Third Middle
School passed their Gaokao with flying colors. 100% pearl
students in Jianshan High School got accepted to their
dream universities. 97% pearl students in Luoyang Third
Middle School got accepted, with 45% getting in tier 1
schools.
Currently, three pearl students joined our workforce, andwe plan to continue providing them with internship andemployment opportunities as we believe pearl students are
future stars that will shine and illuminate the community.

Kunshan Charity Foundation"Care Package" and "Heartfelt
Wish" Activity/ Kunshan Facility /As the saying goes, "never omit to do a good deed
thinking it's too trivial." We donate Care Packages
worth CNY 9,000 with rice, oil, and dried goods to 18
households in need before Chinese New Year, wishing them
the best for the coming year. Also, for six years running,
USI supported Kunshan Charity Foundation's "Heartfelt
Wish" activity. We donate CNY 9,000 to adopt thewishes of 30 impoverished children living in the
Kunshan mountains. There is nothing more powerfulthan seeing the results of our wish-granting efforts
when the children receive a gift they wished for onChildren's Day.

Dreams Come True Project/ Nantou Facility /For the past four years, USI employees organized a gift
registry for colleagues to buy Christmas presents for the
kids in the Nantou Renai Home for Children to bring a
bit of festive joy. In 2021, 70 employees participatedin the gift registry. The head of the Employee Welfare
Committee led 11 volunteers to the Renai Home tospread Christmas cheer. Due to the pandemic, we couldn't
invite the kids to theatre or baseball outings, so in addition
to the gifts, we also brought a show from Apple Theatre. Witha little bit of love, we can make wishes come true and see the joy itbrings.

Sending Love to Retirement Homes/ Jinqiao, Kunshan Facilities /How to make sure seniors are well cared for is the issue
we face in our aging society. USI annually arranges
employees to visit and purchase supplies for local
retirement homes to pay respects to the elderly. In
2021, we donated computers, air conditioners, fruit,
rice, and other daily necessities worth about CNY 23
thousand to Shanghai Tangzhen Retirement Home andKunshan Retirement Home. During our visits, volunteers
and seniors spent a lively afternoon together, addingcolor to their everyday life. USI will continue to spread thelove with the spirit of dedication and responsibility to society.

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AppendixConserving the Environment
The Million Tree Project / Global /In response to SDGs (Goal 13: Climate Action; Goal 15: Life on Land), USI actively promotes
environmental education, protects ecosystems, combats desertification, and reverses landdegradation through collaborating with Shanghai Roots and Shoots Youth Activity Center'sMillion Tree Project. Planting trees in Inner Mongolia and Ningxia not only reduce desertification,
but the project also hires locals to maintain and plant trees, creating job opportunities. According
to Shanghai Roots and Shoots, with the efforts of every volunteer and the local government, theecology is undergoing tremendous change, and we are gradually greening the land. By the endof 2021, USI has planted 107,833 trees covering 76.71 hectares, capturing 16,416 kg of CO2.
The USI Employee Forest was launched in 2016 as an awareness-raising campaign. We
organized employees' donations and volunteers to plant trees in Inner Mongolia and Ningxia.
Unfortunately, our tree planting ambassadors couldn't go to the planting sites due to thepandemic. Thus, employees participated even more actively in donating saplings to contribute toenvironmental protection. In 2021, 21,864 trees were newly planted, of which 7,864 trees were
donated by employees, an increase of 12% over last year.

76.71

USI Tree Planting Data

67.20
53.06
39.62
26.79

3.00

7.85

10.85

18.30

6,160
4,000

4,000

4,000

2013

2014

2015

2016

19,654

20,111

2018

2019

2017

Trees Planted

119

21,864

7,004

Million Tree Project2021 Snapshot of Grass Squares in Ningxia

21,0402021 Snapshot of Tree Planting in Inner Mongolia

Cumulative Area (Ha)

2020

2021

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International Coastal Cleanup

Mini Farmer's Market/ Jinqiao, Nantou Facilities // Nantou Facility /To protect the oceans and coastal ecosystem and take action to
restore them, we have joined the international coastal cleanup
event each year since 2015 to collect and document the trashlittering the coastlines near our facilities. USI encourages
employees to volunteer in these activities to raise environmental
protection awareness through a hands-on approach. We chose
Shanghai Fenxian and Taichung Dajiaxishi Seawall as our cleanup
locations in 2021. In a few hours, 85 volunteers picked over 2,705
pieces of trash, totaling 335.2 kg. Ocean trash is mainly nondegradable plastics, which affects marine wildlife, contaminates
the environment, and ultimately impacts human health. We
hope our engagement with the coastal cleanup can save wetland
habitats and help the fight for trash-free seas.

Local individual farmers bring the fruits of their labor and employees
bring their trust and wallets and use their actions to endorse organic
environmentally friendly farming. This farmer's market not only is aplatform for small farmers to directly sell their produce, it's also a place
where consumers can buy with a peace of mind. Additionally, it is also
a implementation of the Local Production, Local Consumption conceptthat reduces the carbon footprint of daily groceries. USI encourages
employees to shop with local farmers, enhance their connections with thecommunity, protect the environment, and continue this virtuous cycle.

Inclusive
WorkplaceSocialInvolvement

Appendix

Adopt-a-Road Program/ Nantou Facility /

Cao
xi R

d.

USI Nantou Facility's Adopt-a-Road Program entered its 15th year. We
yearly donate CNY 216 thousand to maintain these roads' hedges andcleanliness and sponsor our town's efforts in greening and landscaping
Zhongxing Road. Our adopted streets include a stretch of Caoxi Road (from Zhongxing Road to Maoluoxi Bridge), the provincial
highway No.14B access road to Freeway No.3 (from Maoluoxi Bridge to the intersection at Shengfu Road), and Shengfu Road
intersection to the central island at Shanglin police station.
Z h o ng xin g R d .

Taiping R

3Shanglin
Police Stationd.

Freeway
No.3

Local Rd.
Shengfu Rd.
14
乙Adopted Road (5.65K)
Neighboring Road
Maoluoxi Bridge
LED Signs

120

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Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
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Appendix

Promoting Arts and Culture

121

Title Sponsor Youth Go Competitions

Sponsor Cloud Gate Dance Theatre's Annual Autumn Tour/ Zhangjiang Facility // Nantou Facility /Due to COVID-19, young
professional Go players across thestrait met online and conductedvirtual matches. USI invested CNY
519 thousand sponsoring the USI
Rookie of the Year Competition and
2021 Twin Cities Cup and hopes toenhance Go player's capabilities
and promote cross-strait youth
exchange through the power of Go.

Since 2005, USI has donated CNY 230 thousand a year to
support the Cloud Gate Culture and Art Foundation. We
believe that while technology can improve our qualityof life, art can improve the quality of our minds andsouls. Cloud Gate productions not only show the beautyof dance, but also express the infectious joy of life anddepth of culture. This year we sponsored the Cloud Gate
13 Tongues production and invited 42 supplier partners
to enjoy the show with our senior management at theTamsui Cloud Gate Theatre.

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

AppendixExternal Participation
Societies globally are facing a range of complex challenges, as a global corporate citizen andleader in electronic design and manufacturing services, we recognize the need to take a more
visible role in advocating key issues affecting the industry. We are building relationships withpartners and like-minded stakeholders and advocating on sustainable issues such as climatechange, corporate sustainability, human rights, and sustainable supply chains.
In 2021, USI actively participated in 40 industrial organizations and associations (1~3) andcontributed CNY 342.5 thousand (4). Through meetings, networking events, and serving important
positions, USI keeps in close touch with the industry and contributes to the development of theelectronic and engineering sectors. The following is a partial list of organizations USI joined:
Zhangjiang Facility
Shanghai Integrated Circuit Industry
Association ✦✦✦Pudong Association of Foreign Investment ✦✦✦Shanghai Pudong Human Resource Association(SPHRA)
Securities and Futures Market Work
Committee
The Listed Companies Association of Shanghai
Shanghai Association of Foreign Investment(SAFI)
Shanghai Accounting Association
Jinqiao Facility
Jinqiao Enterprise Association
Shenzhen Facility
Taiwan Merchant Association Shenzhen ✦Shenzhen Enterprise Promotion Association ✦✦Shenzhen Association of Enterprises with
Foreign Investment ✦✦✦Shenzhen Enterprise Confederation ✦✦✦Shenzhen Customs Bureau Association
Shenzhen City Chamber of Commerce for
Import and Export
Shenzhen Hi-tech Industry Association
Shenzhen Quality City Promotion Association

Kunshan Facility
Taiwan Compatriot Investment Enterprises
Association of Kunshan ✦Nantou Facility
Taiwan Electrical and Electronic
Manufacturers' Association (TEEMA) ✦✦Taiwan Telematics Industry Association ✦✦✦Nankang Industrial Manufacturers
Association ✦✦✦Taiwan Association of Occupational Health
Nurses ✦✦✦5G Industry Development Innovation
Alliance
Global Certification ForumUSB Implementers Forum
Video Electronics Standards Association(VESA)VCCI Council
Asia Terahertz Industry Development
Association (ATIDA)
Taiwan Transportation Vehicle
Manufacturers Association

Promotion of RBA
ASEH joined the Responsible Business Alliance (RBA) and became its member in 2015. As amember of ASEH, USI actively abides by the RBA Code of Conduct and requests its facilities
around the globe to implement it. The information regarding our performance in terms ofworkers' human rights, occupational health and safety, corporate ethics and environmental
protection is disclosed on the RBA-Online platform.
USI annually conducts internal audits to ensure compliance. In 2021, the results of RBA
Self-Assessment Questionnaires for Zhangjiang, Jinqiao, Shenzhen, and Kunshan, Nantou,
and Mexico Facilities were all "Low Risk." 100% of worldwide manufacturing facilities have
implemented RBA Validated Audit Process, please refer to the Human Rights Protection
section for details. USI has not only accepted customers' audits but requested and assisted
suppliers to follow the RBA Code of Conduct and join the RBA-Online platform to disclose theirresults. Please refer to the Supply Chain Management section for further details.

Promotion of Responsible Minerals Initiative (RMI)
USI follows the OECD framework Due Diligence for Responsible Supply Chains of Minerals from
Conflict-Affected and High-Risk Areas to establish conflict minerals management mechanism
and complies with RMI, Responsible Minerals Assurance Process (RMAP), and other sourcing
initiatives allowing USI to regularly collaborate with suppliers and customers to reduce theenvironmental impact and contribute to sustainability goals. Please refer to the Conflict Minerals
Compliance section for further details.

Promotion of Carbon Disclosure Project (CDP) and Task Force on Climaterelated Financial Disclosures (TCFD)
USI responds to the responsibility for stopping climate change with specific energysaving actions following our Low-Carbon sustainable strategy and joins the CDP and TCFD
initiatives. For related information and results, please refer to the Climate Change and Carbon
Management section for details.

Note 1. ✦ Represents the position of Chairman/ Vice-chairman
2. ✦✦ Represents the position of Executive Director
3. ✦✦✦ Represents the position of Director/ Supervisor
4. USI did not make any monetary contributions to political campaigns or organizations, lobbyists, or other tax-exempt groups
whose role is to influence political campaigns or legislation

122

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Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix
Management Systems Certification Table
Facility

Zhangjiang

Jinqiao

Shenzhen

KunshanNantouMexicoISO 14001

2004

2016

2001

2012

1998

2006

ISO 14064-1

2010

2016

2010

2011

2009

2016

ISO 50001

2017

2017

2017

2017

2017

2017

ISO 45001

2019

2019

2019

2021

2019

2021

IECQ QC080000

2007

2018

2016

2020

2015

2007

TL 9000

2005

2015

-

2013

-

-

ISO 9001

2004

2015

2016

2014

1993

2007

IATF 16949

2018

-

-

2018

2018

2018

ANSI / ESD S20.20

2013

2018

-

2020

-

-

ISO 13485

-

-

-

2014

-

-

ISO 26262

2017

-

-

2017

-

-

ISO 27001

-

-

-

-

2020

-

RBA VAP

2015

2018

2015

2018

2018

-

Management System(1)

Note 1. The year shown on the table refers to the initial year of certification. All management systems are continuously updated to the latest version as of 2021

123

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Management

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and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

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Appendix

ESG Key Performance Data
Environmental
Renewable Energy Use Percentage (1)

Unit

2018

2019

2020

2021

%

87.2

82.7

79.6

80.3

Mainland China Facilities

%

100

100

100

100

Mexico Facility

%

0

10

21

31

Nantou Facilities

%

10

0

0

0

USI Group

Greenhouse Gas Emissions (2~3)

Unit

2018

2019

2020

2021

Category 1

metrictonnes CO2e

7,024.93

8,438.84

6,802.39

4,592.71

Category 2

metrictonnes CO2e148,201.93

168,730.49

184,225.84

201,538.85

Category 3-6

metrictonnes CO2e115.4822,623.67

16,722,053.37

12,980,878.70

2020

2021

Water Resource Management

Unit

2018

2019

Water withdrawal

ML

581.537681.848803.690861.887

Recycled waterML

142.813155.058

179.145236.972

Recovery rate

%

24.6

22.7

22.3

27.5

Note 1. The reasons of Renewable Energy Use Percentage reduced in USI Group: (1) increased energy consumption data of Nantou-TT1 in 2020; (2) expanded production lines in Nantou-NK sharply increased energy consumption in 2021
2. USI first inventoried GHG emissions Categories 3-6 in 2018, covering only Nantou Facility. In 2019, the inventory scope expanded to Mainland China and Nantou Facilities. In 2020, our inventory scope expanded according to ISO 14064-1:2018 requirements
3. The emissions data of Category 1 and Category 3-6 were modified because of the greenhouse emissions formula revision in 2020124About this Report

Operation and
Governance

Sustainability
Management

Waste Management

Green Products
and Innovation

Unit

Value Chain
Management

2018

Environmental Protection
and Occupational Safety

2019

Inclusive
Workplace

2020

SocialInvolvement

2021

Hazardous waste generated

metric tonnes

537.915696.641783.065967.233

Non-hazardous waste generated

metric tonnes

7,239.187

7,813.671

7,805.962

8,766.093

Non-hazardous waste recycled

metric tonnes

6,940.740

7,067.916

7,079.345

8,115.463

95.88

90.46

90.69

92.58

Non-hazardous waste recycling rate%

Environmental Expenditure

Unit

2018

2019

2020

2021

Total

CNY

20,729,687

23,179,611

28,131,112

25,989,443

Operating cost

CNY

12,589,868

11,428,159

15,177,012

12,176,028

Upstream/ downstream cost

CNY

425,092

516,463854,709

1,058,487

Management overhead

CNY

7,583,392

10,806,289

11,880,177

12,464,402

Social activities cost

CNY

131,335

428,700

219,214290,527

SocialTalent Attraction and Retention

125

Unit

2018

2019

2020

2021

Number of employees-

18,567

18,515

18,615

19,290Male employees-

10,216

10,012

10,184

10,847

Female employees

-

8,351

8,503

8,431

8,443

Percentage of females in total workforce

%

45.0

45.9

45.3

43.8

AppendixAbout this Report

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Governance

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Management

Green Products
and Innovation

Talent Attraction and Retention

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Unit

2018

2019

2020

2021

-

125

133

132

199

Female employees in senior management

-

14

17

17

35

Percentage of females in senior management positions

%

11.2

12.8

12.9

17.6

Employees in management positions

-

984

1,042

1,082

1,091

Female employees in management

-

232

244

255

247

Percentage of females in management positions

%

23.6

23.4

23.6

22.6

-

767

1,086

868

922

-

275

379

310

319

Employees with disabilities

-

77

79

73

83

Average age of employees

Year

29.8

30.6

32.8

31.4

Average number of years employees worked in the Company

Year

3.7

4.1

5.2

4.5

Employee turnover rate

%

48

42

34

36

Ratio of DL entry level wage compared to local minimum wage-

1.00~1.18

1.00~1.13

1.00~1.10

1.00~1.08

Employee engagement score (1)

%

-

77

-

84

Return to work rate of employees that took parental leave

%

38

73

100

68

Retention rate of employees that took parental leave

%

100

100

100

79

Unit

2018

2019

2020

2021

-

733

608

833

867

-

210

194

247

287

M CNY

1.85

7.29

4.21

28.94

Employees in senior management positions (Director or above)

IDL employees promoted
Female IDL employees promoted

Training & Talent Development
Employees that complete the internal lecturer training program
Female internal lecturers
Total cost of employee training and development

Appendix

Note 1. The coverage scope of 2019 employee engagement score was adjusted from IDL (Indirect Labor) to all employees

126About this Report

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Governance

Sustainability
Management

Training & Talent Development

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Unit

2018

2019

2020

2021

Coverage of employee training

%

100

100

100

100

Average hours of training per employee

Hour

21.9

22.6

31.0

30.7

-

2

15

43

73

Employees supported to take advanced studies

Human Rights

Unit

2018

2019

2020

2021

Average training hours on human rights per employee

Hour

0.8

1.1

1.4

1.1

Labor contract signage rate

%

100

100

100

100

Number of employee symposiums

-

145

294

216

116

Employees in a union

-

4,363

4,435

5,900

6,350

%

23.5

24.0

31.7

32.9

Occupational Health and Safety

Unit

2018

2019

2020

2021

Incidences of occupational disease

-

0

1

0

0

Work-related deaths

-

0

0

0

0

Amount invested in safety production

M CNY

120

150

166

159

Number of emergency drills conducted

-

24

52

58

32

Number of health and well-being activities held

-

32

38

53

42

-

3,482

4,447

13,701

13,028

Session

2,453

19,1699,692

18,519Hour

759

13,455

9,140

9,558

Percentage of total workforce in a union

Number of participants in health and well-being activities
Number of doctor consultations held
Total hours consulted

127

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and Innovation

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Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Social Involvement

Unit

2018

2019

2020

2021

Total amount of social involvement

CNY

5,403,647

6,269,375

5,970,377

3,826,752

Investing in Education

CNY

1,171,332

1,521,946

1,259,165

1,713,707

Contributing to Society

CNY1,824,782

2,175,354

2,769,476

489,454

Conserving the Environment

CNY468,224

468,147

433,558

451,281

Promoting Arts & Culture

CNY492,580

1,053,759

1,087,534

829,772

External Participation

CNY

1,446,729

1,050,169

420,645

342,538

-

504

536

1,412

314

Number of hours volunteered

Hour

3,525

3,633

1,674

1,717

Environmental Protection

Unit

2018

2019

2020

2021

-

19,654

20,111

21,04021,864

USI Corporate Forest-

14,00014,00014,00014,000USI Employee Forest

-

5,654

6,111

7,040

7,864

Annual area of trees planted

Ha

12.83

13.44

14.14

9.51

Cumulative number of trees planted-

44,81864,92985,969107,833

Cumulative area of trees planted

Ha

39.62

53.06

67.20

76.71

Weight of coastal trash pickedKg

1,283.96

486.30

49.00

335.2

Pieces of coastal trash picked-

21,462

1,395

3,653

2,705

Unit

2018

2019

2020

2021

Number of employees engaged in social activities

Annual number of trees planted

Rural Revitalization
Number of programs invested

-

5

6

6

5

Number of students assisted

-

791

964

1,001

1,050

K CNY

904

685

1,362

216

Amount invested in targeted programs

Appendix128

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Management

Green Products
and Innovation

Environmental Protection
and Occupational Safety

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Investing in Education

Unit

2018

2019

2020

2021

Cumulative number of Philanthropic Library boxes donated

Box

605

645

685

725

Number of people engaged in Parent-Child Reading Activity

-

106

136

100

119

Number of interns

-

41

93

754

1,415

Local Procurement

Unit

2018

2019

2020

2021

%

22

18

37

39

Mexico

%

30

25

19

12

Taiwan

%

43

42

30

29

Mainland China

%

16

14

38

43

Unit

2018

2019

2020

2021

-

382

515

576

419

%

71

70

70

73

-

75

80

76

83

Unit

2018

2019

2020

2021

-

287

222

120

276

Unit

2018

2019

2020

2021

Number of suppliers that completed due diligence (CMRT survey)

-

379

352

359

416

Percentage of target suppliers completing the conflict-freeminerals

%

100

100

100

100

GlobalSupplier Sustainability Evaluation
Number of suppliers evaluated with sustainability metrics
Percentage of suppliers that completed Supplier Sustainability
Assessment Questionnaire
Number of suppliers and contractors on-site audited withsustainability metrics

Supplier Communication
Number of suppliers attending Sustainable Supply Chain Briefing

Conflict Minerals

129

Value Chain
Management

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Management

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and Innovation

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Management

Environmental Protection
and Occupational Safety

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Appendix

Governance
Financial Performance

Unit

2018

2019

2020

2021

Operating revenue

K CNY

33,550,275.0

37,204,188.4

47,696,228.2

55,299,654.8

Taxes (1)K CNY

398,032.3

352,271.7

397,576.8

618,989.5

Research and Patents

Unit

2018

2019

2020

2021

Share of R&D personnel of total workforce
Amount invested in R&D
R&D intensity
Number of patents accumulated

Continuous Improvement
Number of improvement proposals
Cost saved

Customer Service and Satisfaction

%

6.2

6.8

6.7

9.4

M CNY

1,312

1,373

1,576

1,641

%

3.91

3.69

3.31

2.97

-

589

628

660

696

Unit

2018

2019

2020

2021

-

356

275

319

304

K CNY

83,576

92,62876,95178,756

Unit

2018

2019

2020

2021

On-time delivery

%

98.5

99.0

99.0

99.5

Customer satisfaction

%

82

83

84

84

Note 1. 2019 & 2020 data were adjusted by the accountant

130About this Report

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Governance

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Management

Board of Directors

Value Chain
Management

Unit
-

9

Independent Directors-

3

Percentage of Independent Directors

%

33.3

Number of Directors on the Board

Strategic Committee

Unit
5

Number of Independent Directors in the committee-

1

Percentage of Independent Directors

%

20.0

Audit Committee

Unit

Inclusive
Workplace5

Number of Independent Directors in the committee-

3

Percentage of Independent Directors

%

60.0

SocialInvolvement

AppendixCompensation Committee

Unit

Number of committee members-

5

Number of Independent Directors in the committee-

3

Percentage of Independent Directors

%

60.0

Unit
-

5

Number of Independent Directors in the committee-

3

Percentage of Independent Directors

%

60.0

Number of committee members

Board of Supervisors-

Number of committee members

Environmental Protection
and Occupational Safety

Nomination Committee-

Number of committee members

131Green Products
and Innovation

Unit
-

3

Number of employees on the board of supervisors-

1

Percentage of employees

%

33.3

Number of board members

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Governance

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Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

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Appendix

Sustainability Data - Environmental
A. Task Force on Climate-related Financial Disclosures (TCFD) Framework Response
1. Governance: Disclose the organization's governance around climate-related risks and opportunities
Disclosure
Describe the board's oversight of climate related risks andopportunities(Please refer to the Board Participation in Sustainability
Governance section)
Describe management's role in assessing and managing climaterelated risks and opportunities(Please refer to the Sustainability Committee section)

Specific Practices
The USI Sustainability Committee, the highest organizational unit to manage the Group's sustainable development, annually prepares an ESG
report that includes climate change-related issues for the Board of Directors' review. As climate change becomes the focal point for environmental
protection issues, the Board periodically reviews the annual ESG report and discusses climate-related issues in relevant policy and planningmeetings.
Through the USI Sustainability Committee, management from the President to Vice Presidents and Division Heads all work together to manage
climate-related risks and opportunities. Of the Committee's taskforces, Corporate Governance and Environment Protection & Occupational Safety
taskforces are the leaders in assessing climate-related risks and opportunities.

2. Strategy: Disclose the actual and potential impacts of climate-related risks and opportunities on the organization's businesses, strategy, and financial planning
Disclosure

Describe the climate-related risks and opportunities theorganization has identified over the short, medium, and longterm
(Please refer to the Task Force on Climate-related Financial
Disclosures (TCFD) section)

Describe the impact of climate-related risks and opportunities on
the organization's businesses, strategy, and financial planning(Please refer to the Task Force on Climate-related Financial
Disclosures (TCFD) section)
Describe the resilience of the organization's strategy, taking into
consideration different climate-related scenarios, including a 2° Cor lower scenario(Please refer to the Task Force on Climate-related Financial
Disclosures (TCFD) section)

Specific Practices
According to enterprise risk management (ERM), short-term is defined as within three years, medium-term is four to ten years, and long-term is 11
to 30 years.
Risks:
Short-term Risk: Supply chain shortages and production delays due to changes in rainfall patterns such as floods and droughts, as well as
customer demand for energy efficiency and carbon reduction in products.
Medium-term Risk: Energy saving and carbon reduction measures and carbon tax local policy requirements.
Long-term Risk: Cooperate with governmental commitments to achieving carbon neutrality.
Opportunities:
Short-term Opportunity: Incorporating energy management systems to save energy and reduce carbon emissions. Energy-saving component
product design and technology meet customer needs.
Medium-term Opportunity: Increasing market demand for electric vehicle products.
Climate-related risks and opportunities are assessed to incorporate dimensions including products & services, supply chain, adaptation &mitigation activities, R&D, investment, and operations and then ranked according to their probability and impact.

Our transition risks are modeled by referencing the International Energy Agency's WEO 450 Scenario (2016) and the Nationally Determined
Contribution rates for all manufacturing facilities. Our physical risks are estimated by referencing the World Bank Climate Change Knowledge Portal
and the Taiwan Climate Change Projection Information and Adaptation Knowledge Platform, to estimate the temperature increase and rainfall in
2020-2040 for RCP2.6, RCP4.5, RCP8.52, and other scenarios. Based on these climate scenario models, we would assess the risks and opportunities
posed by climate change to USI.

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and Occupational Safety

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Appendix

3. Risk Management: Disclose how the organization identifies, assesses, and manages climate-related risks
Disclosure
Describe the organization's processes for identifying andassessing climate-related risks(Please refer to the Task Force on Climate-related Financial
Disclosures (TCFD) section)
Describe the organization's processes for managing climaterelated risks

Specific Practices
The Sustainability Committee is dedicated to managing all aspects of climate change related risks. The Committee studies domestic andinternational sustainability and climate change-related initiatives and utilizes the TCFD framework, categorized into transition risks and physicalrisks, to analyze the impact of policies and regulations, technology, markets, corporate reputation, and climate events.

(Please refer to the Task Force on Climate-related Financial
Disclosures (TCFD) section)

Projects that have high climate risks are managed in terms of mitigation and adaptation.
Mitigation: actively promote sustainable manufacturing / use renewable energy / enhance energy efficiency
Adaptation: strengthen climate resilience by finding alternative energy sources, propose R&D strategy according to climate change risk analysis,
and provide integrated solutions to assist customers in adapting to climate change.

Describe how processes for identifying, assessing, and managing
climate-related risks are integrated into the organization's overallrisk management

Integrate climate risk scenario modeling into the ERM process to identify, evaluate, and implement appropriate countermeasures for risks thatmight affect USI's business objectives and to ensure sustainable operations.

(Please refer to the Risk Governance Process section)

4. Metrics and Targets: Disclose the metrics and targets used to assess and manage relevant climate-related risks and opportunities
Disclosure
Metrics used by the organization to assess climate-related risks
and opportunities in line with its strategy and risk management
process

Specific Practices
USI collects and monitors its metrics regarding energy consumption intensity, GHG emissions intensity, electricity savings from energy efficiency
projects and electricity purchased with renewable energy certificates.

(Please refer to the Energy Management section)
Disclose Scope 1, Scope 2, and Scope 3 (1) greenhouse gas (GHG)
emissions, and the related risks(Please refer to the Greenhouse Gas Emissions section)
Describe the targets used by the organization to manage climaterelated risks and opportunities and performance against targets(Please refer to the Task Force on Climate-related Financial
Disclosures (TCFD) section)

We annually inventory and disclose Scope 1 (direct emissions), Scope 2 (indirect emissions), and Scope 3 GHG emissions according to ISO
14064-1:2018 greenhouse gas standard to maintain and obtain ISO certification. Scope 3 inventory items include indirect GHG emissions fromtransportation, products used by the organization, use of sold products, and other sources.
USI sets targets to reduce our carbon emissions and improve our energy efficiency. Our target is to reduce Scope 1 and Scope 2 GHG intensity by
2.5% a year from our 2016 baseline and 35% by 2030. For Scope 3 GHG intensity, we strive to reduce 1.5% a year from our 2020 baseline and 15%
by 2030. We aim to use 100% renewable energy in our operational process by 2035.

Note 1. In the ISO 14064-1:2018 verification, Scope 1 emissions are classified as Category 1, Scope 2 emissions are classified as Category 2, and Scope 3 emissions are classified as Categories 3-6

133About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

B. Indirect Greenhouse Gas Emissions (Category 2 Market-based)
Item

Unit

2017

2018

2019

2020

2021

metric tonnes CO2e

11,623.10

12,879.25

22,165.63

26,056.90

26,617.41

Unit

2017

2018

2019

2020

2021

Recycling / Reuse

metric tonnes

233.65210.95255.13247.23202.79Total

metric tonnes

186.54326.97441.52535.83764.44

Landfill

metric tonnes

5.40

8.00

14.58

29.83

0.64

Incinerated with Energy Recovery

metric tonnes

0

0

0

0

0

Incinerated without Energy
Recoverymetric tonnes

181.14318.97426.94506.00763.80

Unit

2017

2018

2019

2020

2021

Recycling / Reuse

metric tonnes

5,062.92

6,729.85

7,072.29

7,079.35

8,115.46

Total

metric tonnes

523.31509.34741.38726.62650.63

Landfill

metric tonnes

366.26284.00352.32353.46312.78

Incinerated with Energy Recovery

metric tonnes

0

0

0

0

0

Incinerated without Energy
Recoverymetric tonnes

157.05225.34389.06373.16337.85

Category 2 Market-based

C. Hazardous Waste
Item

D. Non-hazardous Waste
Item

134

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Management

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and Innovation

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and Occupational Safety

Inclusive
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E. Environmental Expenditures (1)Unit: CNY

2017
Categories

Operating Cost (2)OperatingExpenses

1,606,221

6,535,6650CapitalInvestments

2019

2020

2021

OperatingExpensesCapitalInvestments

OperatingExpensesCapitalInvestments

OperatingExpensesCapitalInvestments

OperatingExpenses

0

12,589,868

1,779,973

9,648,186

548,685

9,690,160

1,996,631

10,179,397

398,1910425,0920516,4630854,7090

1,058,487

349,143

5,811,481

0

7,583,392

1,731,219

9,075,070

56,792

11,823,385

168,781

12,295,620

0

236,1170

131,335

0428,700

0219,21470,919219,608

1,955,364

12,981,454

0

20,729,687

3,511,192

19,668,419

5,543,644

22,587,468

2,236,331

23,753,112

Social Activities Cost (5)
Total

2018

CapitalInvestments

Upstream / Downstream Cost (3)Management Overhead (4)F. Materials Recycled and Reused
Item

Unit

2018

2019

2020

2021

Pallets

pcs

10,91014,42821,81736,786

Packaging Materials

pcs

6,007,276

6,119,847

7,218,172

8,701,254

metric tonnes

610.05620.40728.43

1,170.46

K CNY

3,755,216

3,452,049

3,050,159

2,387,932

Recycled and Reused Weight
Total Financial Benefits

Note 1. The data covers Zhangjiang, Jinqiao, Shenzhen, Kunshan, and Nantou Facilities
2. Operating Cost: includes pollution prevention costs (air, water, noise, and hazardous substances) and resource circulation costs (efficient resource utilization, waste reduction, and recycling and disposal costs).
3. Upstream / Downstream Cost: includes green procurement, recycling of used products, etc.
4. Management Overhead: includes manpower engaged in environmental improvement activities and environmental education, acquisition of external environmental licenses / certifications, government environmental fees, etc.
5. Social Activities Cost: includes donations to, and support for, environmental groups or activities, etc.

135

AppendixAbout this Report

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Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Sustainability Data - Social
A. Workforce Structure
Zhangjiang
Category

Position (1)Gender

Employment Type (2)Nationality

Jinqiao

Shenzhen

KunshanNantouCategory
Total & Percentage

MexicoHC%(Facility)

HC%(Facility)

HC%(Facility)

HC%(Facility)

HC%(Facility)

HC%(Facility)

Management-Male

141

12.9%

93

8.5%

103

9.4%

124

11.4%

268

24.6%

115

10.5%

844

4.4%

Management-Female

61

5.6%

21

1.9%

53

4.9%

22

2.0%

62

5.7%

28

2.6%

247

1.3%

Technical-Male

580

16.4%

396

11.2%

311

8.8%

339

9.6%

1,123

31.8%

130

3.7%

2,879

14.9%

Technical-Female

143

4.1%

87

2.5%

70

2.0%

64

1.8%

247

7.0%

37

1.0%

648

3.4%

Administrative-Male

71

3.6%

45

2.3%

105

5.3%

124

6.2%

231

11.6%

87

4.4%

663

3.4%

Administrative-Female

206

10.3%

81

4.1%

293

14.7%

192

9.6%

465

23.4%

91

4.6%

1,328

6.9%

Skilled-Male

1,516

12.0%

585

4.6%

1,242

9.8%

1,965

15.5%

471

3.7%

682

5.4%

6,461

33.5%

Skilled-Female

835

6.6%

472

3.7%

1,256

9.9%

1,147

9.0%

1,190

9.4%

1,320

10.4%

6,220

32.2%

2,308

21.3%

1,119

10.3%

1,761

16.2%

2,552

23.5%

2,093

19.3%

1,014

9.3%

10,847

56.2%

Male

HC

%
(Total)

1,245

14.7%

661

7.8%

1,672

19.8%

1,425

16.9%

1,964

23.3%

1,476

17.5%

8,443

43.8%

(3)

2,725

17.7%

1,397

9.1%

2,362

15.3%

2,361

15.3%

4,055

26.3%

2,490

16.2%

15,39079.8%

Temporary (4)

828

21.2%

383

9.8%

1,071

27.5%

1,616

41.4%

2

0.1%

-

0.0%

3,900

20.2%

Domestic-Management

179

1.0%

109

0.6%

145

0.8%

132

0.7%

329

1.8%

133

0.7%

1,027

5.3%

Domestic-Professional

3,332

17.8%

1,657

8.9%

3,262

17.5%

3,826

20.5%

3,241

17.4%

2,332

12.5%

17,65091.5%

Foreign-Management

23

3.8%

5

0.8%

11

1.8%

14

2.3%

1

0.2%

10

1.6%

64

0.3%

Foreign-Professional

19

3.1%

9

1.5%

15

2.4%

5

0.8%

486

79.3%

15

2.4%

549

2.8%

FemalePermanent

Note 1. The position category is divided into Management (employees with management responsibilities such as the Sub-Section manager to Vice Presidents belong to Management), Technical, Administrative, and Skilled positions
2. Dispatch workers: There are 1,730 dispatch workers (1,130 Male and 600 Female) in Mainland China Facilities, accounting for 13.58% of employees in Mainland China Facilities; there are 2 male dispatch workers in the Nantou Facility, accounting for 0.05% of
employees in Nantou Facility
3. Permanent employees: employees who have signed an employment contract with the company and work 8 hours a day, excluding dispatch workers
4. Temporary employees: employees who have signed a regular employment contract with the company, excluding dispatch workers and hourly workers

136About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Zhangjiang
Category

Age

Education

Value Chain
Management

Jinqiao

Environmental Protection
and Occupational Safety

Shenzhen

KunshanInclusive
Workplace

NantouSocialInvolvement

AppendixCategory
Total & Percentage

MexicoHC%(Facility)

HC%(Facility)

HC%(Facility)

HC%(Facility)

HC%(Facility)

HC%(Facility)

HC%(Total)

< 30

1,640

18.3%

801

8.9%

1,574

17.6%

2,740

30.6%

1,049

11.7%

1,154

12.9%

8,958

46.4%

30-50

1,890

19.8%

973

10.2%

1,826

19.1%

1,226

12.8%

2,549

26.7%

1,085

11.4%

9,549

49.5%

> 50

23

2.9%

6

0.8%

33

4.2%

11

1.4%

459

58.6%

251

32.1%

783

4.1%

Ph D.

-

0.0%

-

0.0%

-

0.0%

-

0.0%

11

100.0%

-

0.0%

11

0.1%

Master

88

7.2%

52

4.3%

27

2.2%

26

2.1%

1,012

83.2%

12

1.0%

1,217

6.3%

Bachelor

1,335

20.2%

779

11.8%

810

12.3%

944

14.3%

2,193

33.2%

550

8.3%

6,611

34.3%

High School & Under

2,130

18.6%

949

8.3%

2,596

22.7%

3,007

26.3%

841

7.3%

1,928

16.8%

11,451

59.4%

3,553

18.4%

1,780

9.2%

3,433

17.8%

3,977

20.6%

4,057

21.0%

2,490

12.9%

-

-

Subtotal by Facility
Total

19,290

B. New Hires and Employee Turnover
2021
New Hires Category
Male

Gender

New Entry Rate
Female
New Entry Rate

(1)

2018

2019

2020

10,875

11,880114%

Zhangjiang

Jinqiao

Shenzhen

KunshanMainlandChina Sub-TTL

NantouMexicoTotal

11,880

2,823

1,289

2,726

4,151

10,989476

721

12,186

118%

118%

123%

104%

174%

174%

147%

23%

73%

116%

8,263

6,912

6,912

923

481

1,211

1,802

4,417

506

814

5,737

103%

82%

82%

70%

64%

77%

130%

88%

27%

54%

68%

Note 1. New Entry Rate of the category = New employee headcount of the category in the current year ÷ ((employee headcount of the category at the beginning of the current year + employee headcount of the category y at the end of the current year) ÷ 2) × 100%137

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Appendix

2021
New Hires Category

2018

2019

2020

Management

65

55

7%

Zhangjiang

Jinqiao

Shenzhen

KunshanMainlandChina Sub-TTL

NantouMexico

Total

55

3

0

1

1

5

13

59

77

5%

5%

2%

0%

1%

1%

1%

4%

45%

7%

933

560

560

178

121

68

60

427

148

85

660

29%

16%

16%

24%

24%

18%

15%

21%

11%

52%

19%

533

354

354

53

30

121

68

272

113

88

473

37%

19%

19%

20%

25%

34%

22%

26%

17%

47%

25%

17,607

17,823

17,823

3,512

1,619

3,747

5,824

14,702708

1,303

16,713

148%

147%

147%

145%

132%

166%

200%

167%

45%

64%

135%

15,98814,244

14,244

2,598

1,270

2,930

5,173

11,971508

844

13,323

139%

146%

146%

147%

129%

217%

198%

178%

50%

71%

149%

3,037

4,465

4,465

1,146

499

1,007

780

3,432

457

616

4,505

55%

55%

55%

62%

50%

57%

68%

60%

18%

57%

48%

113

83

83

2

1

0

0

3

17

75

95

26%

13%

13%

9%

13%

0%

0%

4%

4%

32%

13%

19,13816,42018,792

3,746

1,770

3,937

5,953

15,406982

1,535

17,923

109%

89%

101%

103%

89%

125%

158%

123%

25%

61%

95%

1,531

1,220

969

234

151

190

129

704

274

232

1,210

27%

20%

15%

19%

20%

21%

15%

19%

12%

48%

18%

17,607

15,20017,823

3,512

1,619

3,747

5,824

14,702708

1,303

16,713

148%

124%

147%

145%

132%

166%

200%

167%

45%

64%

135%

Average Hiring Cost (1) (CNY)

1,310

807

1,016

2,114

Total No. of IDL Job Transfers

767

1,086

868

922

Inter-departmental IDL
Replacement Rate (2)

33%

47%

47%

43%

New Entry Rate
Technical
Position

New Entry Rate
Administrative
New Entry Rate
SkilledNew Entry Rate
< 30
New Entry Rate

Age

30-50
New Entry Rate
> 50
New Entry Rate

Total No. of New Employees
New Entry Rate
Total No. of New IDL Employees
New Entry Rate
Total No. of New DL Employees
New Entry Rate

Note 1. In 2021, the recruitment cost was redefined, so the statistical data for 2018~2020 were revised
2. Inter-departmental IDL replacement rate = Total IDL Job Transfers ÷ (Total IDL Job Transfers + Total New IDL Employees) × 100%

138

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Management

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and Innovation

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Management

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and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

2021
Employee Turnover
Male

GenderTurnover Rate

(1~2)

FemaleTurnover Rate

Management
Turnover Rate
Technical
Position

Turnover Rate
Administrative
Turnover Rate
SkilledTurnover Rate
< 30
Turnover Rate

Age

30-50
Turnover Rate

2018

2019

2020

4,623

4,537

49%

MainlandChina Sub-TTL

NantouMexico

Total

3,388

254

448

4,090

53%

45%

12%

45%

39%

409

735

1,974

237

577

2,788

38%

26%

53%

39%

13%

38%

33%

20

3

4

46

17

30

93

10%

16%

2%

3%

7%

5%

23%

9%

501

218

173

54

65

510

134

61

705

13%

14%

30%

34%

14%

16%

25%

10%

37%

20%

235

252

54

29

68

49

200

86

81

367

Zhangjiang

Jinqiao

Shenzhen

Kunshan

2,697

1,107

517

507

1,257

45%

27%

48%

42%

32%

3,803

3,301

3,604

548

282

48%

39%

43%

42%

49

45

54

19

5%

4%

5%

585

459

18%
221
15%

13%

14%

20%

24%

19%

16%

19%

13%

44%

19%

7,571

7,099

5,494

1,364

577

791

1,874

4,606

254

853

5,713

64%

58%

45%

56%

47%

35%

64%

52%

16%

42%

46%

6,669

6,023

4,467

1,028

510

574

1,741

3,853

197

564

4,614

58%

53%

46%

58%

52%

43%

67%

57%

19%

47%

52%

1,717

1,760

1,754

624

288

340

251

1,503

269

398

2,170

31%

26%

21%

34%

29%

19%

22%

26%

11%

37%

23%

40

55

80

3

1

2

0

6

25

63

94

9%

10%

13%

13%

13%

6%

0%

9%

6%

27%

13%

Total No. of Resigned Employees

8,426

7,838

6,301

1,655

799

916

1,992

5,362

491

1,025

6,878

Total Employees Turnover Rate

48%

42%

34%

46%

40%

29%

53%

43%

13%

41%

36%

Total No. of Resigned IDL

855

739

807

291

222

125

118

756

237

172

1,165

IDL Turnover Rate

15%

12%

12%

24%

29%

14%

14%

20%

10%

36%

18%

Total No. of Resigned DL

7,571

7,099

5,494

1,364

577

791

1,874

4,606

254

853

5,713

DL Turnover Rate

64%

58%

45%

56%

47%

35%

64%

52%

16%

42%

46%

8,292

7,651

5,846

6,682

47%

41%

31%

35%

> 50
Turnover Rate

Total No. of Voluntary Resignation
Turnover Rate

(3)

Note 1. Turnover Rate for each category = No. of resignations of that category in that year ÷ [(No. of people of that category at the beginning of that year + No. of people of that category at that year-end) ÷ 2] × 100%
2. Number of Turnovers excludes personnel that leave within 90 days of employment
3. Total No. of Voluntary Resignations: number of departures that year deducting those who did not pass the trial period and those who were dismissed

139

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Management

Green Products
and Innovation

Value Chain
Management

Total Employees

Inclusive
WorkplaceSocialInvolvement

Appendix

E. Human Capital Return on Investment & Average Profit per Employee

C. Workforce Breakdown: Nationality Distribution
Nationality

Environmental Protection
and Occupational Safety

ItemManagement

Currency

2018

2019

2020

2021

Headcount%

Headcount%

Mainland China

12,67665.71%

574

52.61%

Taiwan3,661

18.98%

380

34.83%

429

2.22%

0

0.00%

2,465

12.78%

133

12.19%

Singapore

1

0.01%

1

0.09%

Category

Female Average

Male Average

Vietnam

54

0.28%

0

0.00%

Management Position Average Salary

17

23

United Sates

1

0.01%

1

0.09%

Canada

1

0.01%

1

0.09%

Management Position Average
Compensation

29

40

Great Britain

1

0.01%

1

0.09%

Technical Position Average Salary11

12France

1

0.01%

0

0.00%

Technical Position Average
Compensation

14

16

Administrative Position Average Salary

1011Administrative Position Average
Compensation

13

15

Skilled Position Average Salary44

Skilled Position Average Compensation

5

5

Philippines
MexicoTotal

19,290

1,091

D. Workforce Breakdown: Ethnic Minorities (1~2)
Ethnics

Headcount

Race

Headcount

Miao

132

Dong

38

Tujia

89

Yao

31

Yi

89

Dai

15

Zhuang

70

Bai

13

Buyei

48

Va

11

Human Capital Return on
Investment (3) (HC ROI)

-

1.6

1.5

1.6

1.5

Average Profit per Employee (4)CNY

79,50977,275

106,306

112,854

F. Average Salary and Compensation Data by Employee Category

Unit: K CNY

Note 1. There are 591 employees that are ethnic minorities, accounting for 3.1% of the total workforce, including 8 in management
positions, accounting for 0.7% of managers
2. 55 employees not listed above are from 19 other different ethnicities. Since there are less than 10 employees in each of these
ethnic categories, they were not represented in the chart
3. HC ROI = (Total operating income for the current year - (Total operating expenses for the current year - Total employee-related
expenditures for the current year (salary + benefits))) ÷ Total employee-related expenditures for the current year
4. Average Profit per Employee = total profit ÷ ((number of employees at the beginning of the year + number of employees atthe end of the year) ÷ 2)140

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Management

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and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

G. Training Hours and Training Cost
Category

GenderTraining Hours(hours)Position

GenderAge(3)Management

Course Types% of theGroup

Jinqiao

Shenzhen

KunshanNantouMexicoMale

132,428

55,624

48,343

92,13833,711

15,544

377,789

64%

Female59,73428,43831,972

46,78625,84022,103214,874

36%

Management

6,330

3,499

4,036

6,246

5,900

2,297

28,306

5%

Technical

30,216

20,7999,217

13,462

22,4752,327

98,49717%

Administrative

8,135

2,929

7,374

8,847

8,280

6,459

42,023

7%

147,482

56,836

59,688110,369

22,897

26,565423,837

72%

10,578

8,101

11,710102,205

3,610

22,301

158,506

27%

Non-Compulsory
Courses (2)181,585

75,962

68,60436,71955,941

15,347434,157

73%

Total

192,163

84,06380,315

138,925

59,55137,647Male

5,392,269

2,228,478

2,405,442

4,181,064

3,439,226

566,922

18,213,400

63%

Female2,432,282

1,139,324

1,590,839

2,123,069

2,636,202

806,152

10,727,868

37%

< 30

4,634,371

1,839,721

2,299,722

4,509,311

2,515,540

611,026

16,409,692

57%

30-50

3,177,283

1,524,340

1,675,215

1,788,377

3,109,523

583,736

11,858,474

41%

> 50

12,896

3,741

21,3446,445

450,365

178,312673,1032%

Top34,352

9,872

36,722

21,620218,855

2,097

323,518

21%

Middle80,617

31,693102,361

66,501

242,936

18,318542,425

34%

Junior141,332

98,60861,718

195,947

140,094

63,343701,04245%

Compulsory Courses

430,723

324,551582,679

4,637,888

368,322

813,355

7,157,518

25%

Non-Compulsory
Courses

7,393,828

3,043,251

3,413,602

1,666,245

5,707,106

559,719

21,783,751

75%

Total

7,824,551

3,367,802

3,996,281

6,304,133

6,075,428

1,373,074

Compulsory Courses(1)

Note 1. Compulsory course: basic and necessary training for employees, such as: Sunshine behavior policy advocacy, establishment of humane treatment in the workplace, RBA, etc.
2. Non-compulsory course: training to improve the skills of employees in related fields, such as: DOE experimental design, program development and other related training courses
3. Training cost = (actual cost + virtual cost for students to attend class) × (training hours for this group ÷ total training hours)

141

Sub-Total

Zhangjiang

SkilledTypes ofCourses

Training Cost
(CNY)

FacilityGroup592,663

28,941,269

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

H. Degree Programs Offered by Local Schools in Cooperation with USI
Facility

Zhangjiang

KunshanMexicoCooperative School

Study Period

Major

From

End

East China University of Science and Technology

Information Engineering

2019

2022

East China University of Science and Technology

Information Engineering

2020

2023

East China University of Science and Technology

Business Management

2021

2024

East China University of Science and Technology

Human Resource Management

2021

2024

Shanghai University

Electronic Information Engineering

2021

2024

East China University of Science and Technology

International Economy and Trading

2019

2024

East China University of Science and Technology

International Economy and Trading

2020

2025

Shanghai University

Business Management

2021

2026

Soochow University

Logistics Management

2020

2022

Soochow University

Logistics Management

2021

2023

Suzhou Top Institute of Information Technology

Logistics Management

2019

2022

Suzhou Top Institute of Information Technology

Logistics Management

2020

2023

Suzhou Top Institute of Information Technology

Logistics Management

2021

2024

COBAEJHigh School

2020

2022

High School

Vocational
School to
Junior College

High School
to College

Junior College
to University
●
●
●
●
●

●

18
30
4
1
23
11

●

11

●

●
●

●

16
75
55
42

●
●

No. of
Employees
Taking Degree

66

●

54
57

Sustainability Data - Governance
A. Number of Anti-corruption Trainings in 2021 (including resigned employees)
Facility

Zhangjiang

Jinqiao

Shenzhen

KunshanNantouMexicoTotal

Employees Excluding Senior Managers

3,752

2,018

6,173

3,708

4,508

2,168

22,485

23

8

34

15

66

12

158

Senior Managers

142About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Third-Party Assurance Statement

143

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

AppendixAbout this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

AppendixThird-Party Assurance Statement

144

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

GRI & CASS-CSR 4.0 Index
Level of External Assurance: Moderate ○ High ●General Disclosures
Disclosures

CASS-CSR 4.0

SectionPage

Additional Explanation

Level of Assurance

Organizational Profile
102-1

Name of the organization

Company Overview

13

○

102-2

Activities, brands, products, andservices

Company Overview

13

○

102-3

Location of headquarters

Company Overview

13

○

102-4

Location of operations

Company Overview

13○

Company Overview

13○

Company Overview

13○

Company Overview

13

Financial Performance

15

Research and Patents

40

Global Workforce Structure

94

ESG Key Performance Data

125

Sustainability Data - Social

136

Product Value Chain

48

Supply Chain Management

53

Company Overview

13

102-5

Ownership and legal form

102-6

Markets served

102-7

102-8

145

Scale of the organization

Information on employees andother workers

102-9

Supply chain

102-10Significant changes to theorganization and its supply chain

P4.1 Organizational structure and operating
locationP4.2 Main products, services, and brands
P4.3 Enterprise size and influence
P4.4 Major changes in organizational size,
structure, ownership, or supply chain
during the reporting period
S2.1 Employee composition
S4.2 Employee localization policy
S4.3 Local employment rate○○○
Since acquiring Asteelflash in 2020, we
have more than 220 production lines○

About this Report

Operation and
Governance

Sustainability
Management

Disclosures102-11

102-12102-13

Green Products
and Innovation

Value Chain
Management

CASS-CSR 4.0

Precautionary Principle or approach

External initiatives

G5.3 Participation of research projects
and formulation of corporate social
responsibility standards, initiatives, andguidelines
G6.3 Joining of corporate social responsibility
organizations or conventions

Membership of associations

Environmental Protection
and Occupational Safety

Section

Page

Enterprise Risk Management

19

Green Product Management

43

Supplier Sustainability Risk
Assessment

57

Conflict Minerals Compliance60

Climate Change and Carbon
Management

64

Carbon Management

67

External Participation

122

Inclusive
Workplace

Additional Explanation

SocialInvolvement

Appendix

Level of Assurance○○○

Strategy102-14102-15

Statement from senior decisionmaker

Key impacts, risks, and opportunities

P2.1 Situation analysis and strategic
consideration of corporate social
responsibility performanceP2.2 Annual work progress in corporatesocial responsibility
P3.1 Major corporate social responsibility
events
P3.2 Progress and achievement in key
corporate social responsibility issues
G2.2 Strategic planning and annual plans forcorporate social responsibility programs
G2.3 Promotion of integration of corporatesocial responsibility into corporate
development strategy and day-to-day
operation

Letter from the Chairman

5○

Letter from the President

Key Performance and Targets

6-

Explained in each chapter○
Enterprise Risk Management

19

Ethics and Integrity
102-16

Values, principles, standards, andnorms of behavior

G1.1 Corporate mission, vision, and values
M3.1 Business integrity

Business Ethics andCompliance18○102-17

Mechanisms for advice and concerns
about ethics

S1.1 Legal compliance system
S1.2 Law compliance training

Business Ethics andCompliance

18

○

146

About this Report

Operation and
Governance

Sustainability
Management

Disclosures

Green Products
and Innovation

Value Chain
Management

CASS-CSR 4.0

Environmental Protection
and Occupational Safety

SectionPage

Inclusive
Workplace

Additional Explanation

SocialInvolvement

Level of Assurance

Governance102-18Governance structure102-22Composition of the highest
governance body and its committees

102-23Chair of the highest governance body102-24

Nominating and selecting the highest
governance body102-32Highest governance body's role insustainability reporting

102-33G3.1 Support for and promotion of
corporate social responsibility workfrom the highest authority
G3.2 Leading group for and working
mechanism on corporate social
responsibility
G3.3 Organizational system and divisionof responsibilities of corporate social
responsibility
G4.1 Formulation of corporate social
responsibility system
G4.3 Implementation of corporate social
responsibility performance appraisal
or assessment
G5.1 Implementation of corporate social
responsibility training
M1.1 Corporate governance regulation
M1.2 Nomination and selection processof the highest governing group andcommittee
E2.18 Policies for developing circular
economyCommunicating critical concerns

Board Structure

16

Board Structure

16○

All board directors are male○

ESG Key Performance Data

131

Board of Directors

16○

Board of Directors

16○

Sustainability Committee

25○

Board of Directors

16

Board Engagement with
Sustainability Governance17

Conflicts of Interest
Management

17

Sustainability Committee

25

Stakeholder Engagement

32

Employee Rights

92

Employee Unions

92

ESG Key Performance Data

127○

Stakeholder Engagement102-40102-41

147

List of stakeholder groups

Collective bargaining agreements

S2.3 Labor contract signing rate

Appendix○○About this Report

Operation and
Governance

Sustainability
Management

Disclosures
102-42

Identifying and selecting
stakeholders

102-43

Approach to stakeholder
engagement102-44

Key topics and concerns raised

Green Products
and Innovation

Value Chain
Management

CASS-CSR 4.0
G6.1 Identification of and responding topursuits of stakeholders
G6.2 Internal and external communication
mechanisms and activities ofcorporate social responsibility

Environmental Protection
and Occupational Safety

Inclusive
Workplace

Additional Explanation

SocialInvolvement

Section

Page

Material Issues Identification

32○

Stakeholder Engagement

36○

Material Issues Identification

32

Stakeholder Engagement

36

Financial Performance

15○

Material Issues Identification

34○

Material Issues Identification

34○

Appendix

Level of Assurance○

Reporting Practice102-45

Entities included in the consolidated
financial statements

102-46

Defining report content and topic
boundaries

102-47

List of material topics

102-48

Restatements of information-

102-49Changes in reporting

Material Issues Identification

32○

102-50

Reporting period

About this Report

4○102-51

Date of most recent report

About this Report

4○102-52

Reporting cycle

About this Report

4○102-53

Contact point for questions
regarding the report

About this Report

4○102-54Claims of reporting in accordancewith the GRI Standards

About this Report

4○102-55GRI Content Index

145○

102-56External assurance

G2.1 Identification and management ofmaterial issues in corporate social
responsibility

P1.1 Quality assurance
P1.2 Information interpretation
P1.3 Reporting system
G4.2 Constructian of corporate social
responsibility indicator system

GRI & CASS-CSR 4.0 Index
About this Report
Third-Party AssuranceStatement-

Explained in each chapter

○

4
143

○

148

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
Workplace

Appendix

Identified Result: Material Issue ★
Level of External Assurance: Moderate ○ High ●Topic Specific Standards (For Material Issues)
Management Approach and Disclosure

SocialInvolvement

CASS-CSR 4.0

SectionPage

Additional
Explanation

Identified Level ofResult Assurance

Governance (Economic) Standard Series

201-1
Economic
PerformanceMarketPresence

Procurement
Practices

149

Direct economic value generated and distributed

M1.6 GrowthM1.7 Profitability
M1.8 Safety
S1.3 Total tax amountFinancial Performance15

Tax Governance

16Comprehensive Compensation
System97

ESG Key Performance Data128

ESG Key Performance Data

130

●

201-2

Financial implications and other risks andopportunities due to climate change

Climate Change and Carbon
Management

64

●

201-3

Defined benefit plan obligations and otherretirement plans

Employee Benefits

101

●

201-4

Financial assistance received from government

Financial Performance

15

●

103-1

Explanation of the material topic and its Boundary

Material Issues Identification

34

○

103-2

The management approach and its components

Comprehensive Compensation
System

97

○

103-3

Evaluation of the management approach

Comprehensive Compensation
System

97

○

202-1

Ratios of standard entry level wage by gendercompared to local minimum wage

Comprehensive Compensation
System97

ESG Key Performance Data

126

Global Workforce Structure

95

★

●

★

●

202-2

Proportion of senior management hired from thelocal community

103-1

Explanation of the material topic and its Boundary

Material Issues Identification

34

○

103-2

The management approach and its components

Supply Chain Management

53

○

103-3

Evaluation of the management approach

Supply Chain Management

53

○

204-1

Proportion of spending on local suppliersS4.3 Local employment ratio

S4.4 Local procurement policy

Supply Chain Management55

ESG Key Performance Data

129

★

●

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Management Approach and Disclosure

Anticorruption

CASS-CSR 4.0

Environmental Protection
and Occupational Safety

SectionPage

Inclusive
WorkplaceSocialInvolvement

Additional
Explanation

Appendix

Identified Level ofResult Assurance

103-1

Explanation of the material topic and its Boundary

Material Issues Identification

34

○

103-2

The management approach and its components

Business Ethics and Compliance

18

○

103-3

Evaluation of the management approach

Business Ethics and Compliance

18

205-1

Operations assessed for risks related to corruption

Business Ethics and Compliance

18

★

○

Business Ethics and Compliance18

Sustainability Data - Governance

142
53

★

●

Supply Chain Management
Business Ethics and Compliance

18

★

●

Material Issues Identification

34○

Business Ethics and Compliance18○

Regulatory Compliance

19

○

205-2

Anticompetitive
Behavior

Value Chain
Management

Communication and training about anti-corruption
policies and procedures

205-3

Confirmed incidents of corruption and actions
taken

103-1

Explanation of the material topic and its Boundary

103-2

The management approach and its components

103-3

Evaluation of the management approach

206-1

Legal actions for anti-competitive behavior, antitrust, and monopoly practices

M1.3 Anti-corruption
M1.4 Compliance information
disclosure

M2.11 Fair tradeM3.2 Economic contract
compliance rate
M3.3 Fair competition
M3.5 Respect and protect
intellectual property
rightsNo incidents of corruption
detected in 2021

USI has no legal actions
related to anti-competitive
behavior, anti-trust, ormonopoly practices in 2021

★

●

●

Regulatory Compliance19

Material Issues Identification

34○

Climate Change and Carbon
Management

64○

Energy Management

69

○

69

●

69

●

Environmental Standard Series
103-1

Explanation of the material topic and its Boundary

103-2

The management approach and its components

103-3

Evaluation of the management approach

302-1

Energy consumption within the organization

302-3

Energy intensity

302-5

Reductions in energy requirements of products
and services

EnergyE2.2 Purchasing and using
environmentally friendly
raw material
E2.3 Energy conservation
policies and measures
E2.4 Improve energy efficiency
E2.5 Annual total energy
consumption andreduction
E2.6 Comprehensive energy
consumption per unit
output value
E2.7 Clean energy policy andmeasureE2.8 Clean energy usage

Energy Management
Energy Management
Green Product Management

44

★

●

150

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Management Approach and Disclosure

Water andEffluents(2018)

Emissions

Waste(2020)

Environmental
Compliance

151

303-3

Water withdrawal

Value Chain
Management

CASS-CSR 4.0
E2.9 Water conservation
policy and measure
E2.10 Annual freshwater
consumption
E2.14 Reduce waste emissions
policy, measure, or
techniqueE2.15 Wastewater dischargeand emission reduction

Environmental Protection
and Occupational Safety

Inclusive
Workplace

Section

Page

Water Management

71

SocialInvolvement

Additional
Explanation

Appendix

Identified Level ofResult Assurance●
ESG Key Performance Data

124

103-1

Explanation of the material topic and its Boundary

Material Issues Identification

34

○

103-2

The management approach and its components

Climate Change and Carbon
Management

64

○

103-3

Evaluation of the management approach

Carbon Management

67○

Carbon Management67

ESG Key Performance Data

124

305-1

Direct (Scope 1) GHG emissions

305-2

Energy indirect (Scope 2) GHG emissions

305-3

Other indirect (Scope 3) GHG emissions

305-4

GHG emissions intensity

305-5

Reduction of GHG emissions

305-7

Nitrogen oxides (NOx), sulfur oxides (SOx), andother significant air emissions

306-1

Waste generation and significant waste-related
impacts

306-2

Management of significant waste-related impacts

306-3

Waste generated

306-5

Waste directed to disposal

103-1
103-2

E1.9 Responding to climatechangeE2.12 Reduce exhaustemissions policy,
measure, or techniqueE2.13 Exhaust emissions andemission reduction
E2.24 Plan and action to
reduce greenhouse gas
emissionsE2.25 Greenhouse gas emission
and emission reduction

Carbon Management67

ESG Key Performance Data

124

★

●

★

●

★

●

★

●

Carbon Management68

ESG Key Performance Data

124

Carbon Management

67

Energy Management

69

Air Pollution Control

74

Waste Management

72○

Waste Management

72○

Waste Management

72

Waste Management73●

Explanation of the material topic and its Boundary

Material Issues Identification

34○

The management approach and its components

Climate Change and Carbon
Management

64

Regulatory Compliance

19

E2.16 Develop circular
economy policy andmeasures
E2.17 Waste emissions andemission reduction

103-3

Evaluation of the management approach

Regulatory Compliance

19

307-1

Non-compliance with environmental laws andregulations

Climate Change and Carbon
Management

64

★
★

●
●

●

○
○
No major penalties or othernon-pecuniary sanctions were
imposed on USI in 2021★

●

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Management Approach and Disclosure

Supplier
Environmental
Assessment

103-1

Explanation of the material topic and its Boundary

103-2

The management approach and its components

103-3

Evaluation of the management approach308-1

New suppliers that were screened using
environmental criteria

308-2

Negative environmental impacts in the supply
chain and actions taken

Value Chain
Management

CASS-CSR 4.0
M3.8 Supplier social
responsibility policy,
initiative, andrequirement
M3.9 Number of potential
suppliers that were
rejected because ofsocial irresponsibility
M3.10 Supplier social
responsibility
routine management
mechanism
M3.11 The process andmethod of suppliersocial responsibility
audit
M3.12 Number of suppliers
audited during thereporting period
M3.13 Number of suppliers
terminated due tounqualified social
responsibility
M3.14 Supplier's social
responsibility
performanceassessment andcommunication
M3.15 Supplier's social
responsibility training
M3.16 Supplier's social
responsibility training
performance

Environmental Protection
and Occupational Safety

Inclusive
Workplace

Additional
Explanation

SocialInvolvement

Appendix

Identified Level ofResult Assurance

Section

Page

Material Issues Identification

34○

Supply Chain Management

53○

Supplier Evaluation and Regular
Assessment

56○

Supplier Evaluation and Regular
Assessment

56

★

●

Supplier Sustainability Risk
Assessment

57

★

●

152

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Management Approach and Disclosure

Value Chain
Management

CASS-CSR 4.0

Environmental Protection
and Occupational Safety

Inclusive
Workplace

SectionPage

Additional
Explanation

SocialInvolvement

Appendix

Identified Level ofResult AssuranceSocial Standards Series

Employment

Labor /
Management
RelationsOccupational
Health and
Safety (2018)

153

103-1

Explanation of the material topic and its Boundary

Material Issues Identification

34

○

103-2

The management approach and its components

Recruiting the Right Talents

96

○

103-3

Evaluation of the management approach

Recruiting the Right Talents

96

Employee Benefits

98

401-1

New employee hires and employee turnover

Recruiting the Right Talents

96

★

●

401-2

Benefits provided to full-time employees thatare not provided to temporary or part-time
employees

Employee Benefits

99

★

●

401-3

Parental leave

Employee Benefits

100

★

●

103-1

Explanation of the material topic and its Boundary

Material Issues Identification

34

○

103-2

The management approach and its components

Human Rights Protection

89

○

103-3

Evaluation of the management approach

Due Diligence Process

89

○

402-1

Minimum notice periods regarding operationalchanges

Employee Rights

92

103-1

Explanation of the material topic and its Boundary

Material Issues Identification

34

○

103-2

The management approach and its components

Occupational Health and Safety

77

○

103-3

Evaluation of the management approach

Occupational Health and Safety

77

○

403-1

Occupational health and safety management
systemOccupational Health and Safety

77

403-2

Hazard identification, risk assessment, andincident investigation

Occupational Health and Safety77

S1.5 Drive employment
S1.6 Number of employed in
the report period
S2.20 Employee turnover rate
S2.9 Annual leave per capita
S2.10 Welfare and salarysystem
S2.17 Work-life balanceS2.18 employee difficulty
assistanceS2.11 Occupational healthmanagement
S2.12 Working environmentand condition guarantee
S2.13 Employee mental healthassistanceS3.1 Safety production
management system
S3.2 Safety emergency
management mechanism
S3.3 Safety education andtraining

○

★

★
★

●

○
○

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Management Approach and Disclosure

Occupational
Health and
Safety (2018)

Training and
Education

Value Chain
Management

CASS-CSR 4.0

Environmental Protection
and Occupational Safety

SectionPage

Inclusive
Workplace

Additional
Explanation

SocialInvolvement

Appendix

Identified Level ofResult Assurance

★

403-3

Occupational health services

Physical and Mental Health
Care

84

403-4

Worker participation, consultation, andcommunication on occupational health and safety

Occupational Health and Safety
Management

77

403-5

Worker training on occupational health and safety

Occupational Health and Safety
Management

82

403-6

Promotion of worker health

Physical and Mental Health
Care

84

★

○

403-7

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

Occupational Health and Safety
Management

77

★

○

403-8

Workers covered by an occupational health andsafety management system

Occupational Health and Safety

77

★

●

403-9

Work-related injuries

Occupational IncidentManagement80403-10Work-related ill healthOccupational Health and Safety
Management

77

103-1

Explanation of the material topic and its Boundary

Material Issues Identification

34

○

103-2

The management approach and its components

Human Capital Development

106

○

103-3

Evaluation of the management approach

Human Capital Development

107

○

404-1

Average hours of training per year per employee

Human Capital Development

107

ESG Key Performance Data

127

404-2

Programs for upgrading employee skills andtransition assistance programs

Tailored Career Plan

108

★

○

404-3

Percentage of employees receiving regularperformance and career development reviews

Employee Performance
Appraisal and Development

104

★

●

S3.4 Safety training
performance
S3.5 Safety production
investment
S3.6 Number of safety
production accident
S3.7 Employee casualties

S2.15 Annual training
performance
S2.16 Career development
pathway

★
★

★
★

★

○
○
○

●
●

●

154

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Management Approach and Disclosure

Diversityand Equal
Opportunity

NonDiscrimination

Freedom of
Association
and Collective
Bargaining

Child Labor

Forced orCompulsory
Labor

155

Value Chain
Management

CASS-CSR 4.0

Environmental Protection
and Occupational Safety

Inclusive
Workplace

SectionPage

Additional
Explanation

SocialInvolvement

Appendix

Identified Level ofResult Assurance

103-1

Explanation of the material topic and its Boundary

Material Issues Identification

34

○

103-2

The management approach and its components

Talent Attraction and Retention

94○

Global Workforce Structure

94

Comprehensive Compensation
System97

103-3

Evaluation of the management approach

405-1

Diversity of governance bodies and employees

405-2

S2.2 Equal employment
S2.5 Female manager ratio
S2.6 Employee privacy
management
S2.8 Diversity and equal
opportunity○

Global Workforce Structure

94

ESG Key Performance Data

125

Ratio of basic salary and remuneration of women
to menComprehensive Compensation
System98

103-1

Explanation of the material topic and its Boundary

Material Issues Identification

34

○

103-2

The management approach and its components

Human Rights Protection

89

○

103-3

Evaluation of the management approach

Due Diligence Process

89

○

406-1

Incidents of discrimination and corrective actions
taken

Human Rights Mitigation &Remediation

91

103-1

Explanation of the material topic and its Boundary

Material Issues Identification

34

○

103-2

The management approach and its components

Human Rights Protection

89

○

103-3

Evaluation of the management approach

Due Diligence Process89○

Due Diligence Process

89

407-1

Operations and suppliers in which the right tofreedom of association and collective bargaining
may be at risk

Employee Unions

92

Supplier Evaluation and Regular
Assessment

56

S2.2 Equal employment

S2.4 Democratic management

○

★

★

★

●

○

○

103-1

Explanation of the material topic and its Boundary

Material Issues Identification

34

○

103-2

The management approach and its components

Human Rights Protection

89

○

103-3

Evaluation of the management approach

Due Diligence Process89○

Due Diligence Process

89

Supplier Evaluation and Regular
Assessment

56

★

408-1

Operations and suppliers at significant risk forincidents of child labor

Conflict Minerals Compliance

60

103-1

Explanation of the material topic and its Boundary

Material Issues Identification

34

○

103-2

The management approach and its components

Human Rights Protection

89

○

103-3

Evaluation of the management approach

Due Diligence Process

89

○

○

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Management Approach and Disclosure
Forced orCompulsory
Labor

Human Rights
Assessment

Supplier Social
Assessment

Value Chain
Management

CASS-CSR 4.0

Environmental Protection
and Occupational Safety

SectionPage

Due Diligence Process

89

Supplier Evaluation and Regular
Assessment

56

Inclusive
Workplace

Additional
Explanation

SocialInvolvement

Appendix

Identified Level ofResult Assurance

★

409-1

Operations and suppliers at significant risk forincidents of forced or compulsory labor

Conflict Minerals Compliance

60

103-1

Explanation of the material topic and its Boundary

Material Issues Identification

34

○

103-2

The management approach and its components

Human Rights Protection

89

○

103-3

Evaluation of the management approach

Due Diligence Process

89

○

412-1

Operations that have been subject to humanrights reviews or impact assessments

Due Diligence Process

90

412-2

Employee training on human rights policies orprocedures

Human Rights Training

92

103-1

Explanation of the material topic and its Boundary

Material Issues Identification

34

○

103-2

The management approach and its components

Supply Chain Management

53

○

103-3

Evaluation of the management approach

Supplier Evaluation and Regular
Assessment

56

○

414-1

New suppliers that were screened using social
criteria

Supplier Evaluation and Regular
Assessment

56

Supplier Sustainability Risk
Assessment

57

ESG Key Performance Data

129

Conflict Minerals Commitment
and Future Plans

61

414-2

Negative social impacts in the supply chain andactions taken

S2.7

Anti-forced labor andharassment abuse

M3.8 Supplier social
responsibility policy,
initiative, andrequirement
M3.9 Number of potential
suppliers that were
rejected because of social
irresponsibility
M3.10 Supplier social
responsibility routine
management mechanism
M3.11 The process and methodof supplier social
responsibility audit
M3.12 Number of suppliers
audited during thereporting period
M3.13 Number of suppliers
terminated due tounqualified social
responsibility
M3.14 Supplier's social
responsibility
performance assessment
and communication
M3.15 Supplier's social
responsibility training
M3.16 Supplier's social
responsibility training
performance

★
★

○

●
●

★

●

★

●

156

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Management Approach and Disclosure

Marketing andLabeling

CustomerPrivacy

Inclusive
WorkplaceSocialInvolvement

Additional
Explanation

Appendix

Identified Level ofResult Assurance

Page

Explanation of the material topic and its Boundary

Material Issues Identification

34

○

103-2

The management approach and its components

Customer Privacy and Product
Safety

51

○

103-3

Evaluation of the management approach

Customer Health and Safety

52

○

416-1

Assessment of the health and safety impacts ofproduct and service categories

Customer Health and Safety

52

416-2

Incidents of non-compliance concerning thehealth and safety impacts of products and services

Customer Health and Safety

52

103-1

Explanation of the material topic and its Boundary

Material Issues Identification

34

○

103-2

The management approach and its components

Business Ethics and Compliance

18

○

103-3

Evaluation of the management approach

Regulatory Compliance19

M2.2 Product and service
quality control system
M2.10 Potential risk warning★
There were no violations
or complaints concerning
health and safety impact of
products in 2021

★

●
●

○
There were no incidents of
non-compliance concerningmarketing communicationsin 2021

★

●

417-3

Incidents of non-compliance concerning marketing
communications

Regulatory Compliance

19

103-1

Explanation of the material topic and its Boundary

Material Issues Identification

34

○

103-2

The management approach and its components

Customer Privacy and Product
Safety

51

○

103-3

Evaluation of the management approach

Customer Privacy

51○

Business Ethics

18

There were no incidents ofdata breaches or customer
privacy violations in 2021

Customer Privacy

51

We did not receive any
privacy complaints in 2021

418-1

Substantiated complaints concerning breaches ofcustomer privacy and losses of customer data

M2.13 Protect customer
information

★

●

103-1

Explanation of the material topic and its Boundary

Material Issues Identification

34

○

103-2

The management approach and its components

Business Ethics and Compliance

18

○

103-3

Evaluation of the management approach

Regulatory Compliance19

Socioeconomic
Compliance
419-1

157

CASS-CSR 4.0

Environmental Protection
and Occupational Safety

Section103-1

Customer
Health and
SafetyValue Chain
Management

Non-compliance with laws and regulations in thesocial and economic area

Regulatory Compliance19○
USI received 3 occupationalsafety and workplaceenvironmental monitoringrelated notice ofimprovement within time
limit in 2021. All have beencorrected within the time
limit, and there were no
significant penalties.

★

●

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

SASB Index
Topic

Code

Accounting Metric

Unit ofMeasureWater Management

TC-ES-140a.1(1) Total water withdrawn, (2) total water consumed,
percentage of each in regions with High or ExtremelyHigh Baseline Water Stressm3, %Water Management

71

Waste Management

TC-ES-150a.1

Amount of hazardous waste from manufacturing,
percentage recycledt, %Waste Management

72

Labor Practices

TC-ES-310a.1(1) Number of work stoppages and (2) total days idle

Number,days idle

Employee Unions

92

Materials Sourcing

TC-ES-440a.1

Description of the management of risks associatedwith the use of critical materials

N /A

Supply Chain Management
Conflict Minerals ComplianceEnterprise Risk Management Process

53
60
21

TC-ES-000.A

Number of manufacturing facilities

NumberCompany Overview

13

TC-ES-000.B

Area of manufacturing facilities

Square feet
(ft2)

Company Overview

13

TC-ES-000.C

Number of employees

NumberGlobal Workforce Structure

94

SectionPage

Activity Metrics

Summary

There were no work stoppages due to major
labor disputes or strikes in 2021

The area of the manufacturing facilities
within this report's scope boundaries is4,866,859 ft2 after conversion

SectionPage

USI Specific Disclosures and Additional Indicators
Disclosure

CASS-CSR 4.0

SourceConflict Minerals Management

USI Specific Disclosure

Conflict Minerals
Compliance

60

Continuous Improvement Program

USI Specific Disclosure

Continuous Improvement
Program41

Innovation and Development

Parent Company (ASEH) Specified Disclosure

Research and Patents

40

Parent Company (ASEH) Specified Disclosure
Shanghai Listed Corporate Social Responsibility Development Index(2017) Evaluation Index

Customer Service andSatisfaction

49

Customer Relationship Management System

M2.3 Pass rate
M3.4 Strategic common mechanism platform
M3.6 Helping industry development

158

About this Report

Operation and
Governance

Sustainability
Management

Disclosure

Value Chain
Management

CASS-CSR 4.0

Environmental Protection
and Occupational Safety

Inclusive
Workplace

SourceSocialInvolvement

SectionAppendix

Page

After-sales Service System

M2.14 Active after-sales service system
M2.15 Actively respond to consumer complaintM2.16 Complaint resolution rate
M2.18 Customer satisfaction

Shanghai Listed Corporate Social Responsibility Development Index(2017) Evaluation Index

Customer Service andSatisfaction

49

Product Recall, Stop-Loss, Compensation

M2.17 Stop loss and compensation

Shanghai Listed Corporate Social Responsibility Development Index(2017) Evaluation Index

All-Encompassing AfterSales Service

50

Shareholder Participation

Shanghai Listed Corporate Social Responsibility Development Index(2017) Evaluation Index

Board Governance16

Social Contribution per Share

Shanghai Listed Corporate Social Responsibility Development Index(2017) Evaluation Index

Letter from the President

6

Shanghai Listed Corporate Social Responsibility Development Index(2017) Evaluation Inde

Conflicts of Interest
Management

17

Shanghai Listed Corporate Social Responsibility Development Index(2017) Evaluation Index

Research Patents andContinuous Improvement40

Product Quality Control Systems andCertification

Shanghai Listed Corporate Social Responsibility Development Index(2017) Evaluation Index

Management Systems
Certification Table123

Supplier List

Shanghai Listed Corporate Social Responsibility Development Index(2017) Evaluation Index

Supplier Evaluation andRegular Assessment

56

Provide Special Protections for Special
Populations (such as pregnant orbreastfeeding employees)

Shanghai Listed Corporate Social Responsibility Development Index(2017) Evaluation Index

Employee Benefits

99

Number or Percentage of Employees with
Disabilities

Shanghai Listed Corporate Social Responsibility Development Index(2017) Evaluation Index

Global Workforce Structure

95

Recognition from Environmental Protection
Authorities

Shanghai Stock Exchange Listed Company Environmental Information
Disclosure Guidelines

Awards and Recognition

9

Shanghai Listed Corporate Social Responsibility Development Index(2017) Evaluation Index

Employee Engagement
Survey105

Ensure Reasonable Returns for Shareholders

Measures to Support Scientific Researchand Development

Employee Engagement

159

Green Products
and Innovation

M1.5 Protect the interests of small and medium
investors
M3.7 Fair trade
M2.1
M2.4
M2.5
M2.6
M2.7

Improve product and service accessibility
Continuous innovation
R&D investment
New number of patents
Industrialization of scientific andtechnological achievements

S2.19 Employee satisfaction

About this Report

Operation and
Governance

Sustainability
Management

Disclosure

Green Products
and Innovation

Value Chain
Management

CASS-CSR 4.0

Environmental Protection
and Occupational Safety

Inclusive
Workplace

SourceSocialInvolvement

Appendix

Section

Page

S4.6

Community Responsibility

Charitable contribution policy and its main
sector
S4.9
Building brand public welfare projects
S4.10 Supporting volunteer activities policy andmeasuresS4.11 Employee volunteer activities performance

Shanghai Listed Corporate Social Responsibility Development Index(2017) Evaluation Index

Social Activities Overview

113

S4.12 Helping Targeted Poverty Alleviation
S4.13 Poverty Alleviation Funds
S4.14 The number of people out of poverty

Shanghai Listed Corporate Social Responsibility Development Index(2017) Evaluation Index

Contributing to Society

117

E1.1

Environmental management system

Shanghai Stock Exchange Listed Company Environmental Information
Disclosure Guidelines

Climate Change andCarbon Management64

M2.12 Promote sustainable consumption
E1.6 Building green supply chain

Shanghai Stock Exchange Listed Company Environmental Information
Disclosure Guidelines

Green Supply Chain

45

Shanghai Stock Exchange Listed Company Environmental Information
Disclosure Guidelines

Green ProductManagement

43

Total investment in environmental
protection
E2.20 Green Package
E2.22 Green transportation
E2.23 Environmental impact of producttransportation
E3.1 Green office measureE3.2 Green office performance
E3.5
Zero net deforestation

Shanghai Stock Exchange Listed Company Environmental Information
Disclosure Guidelines

Green Manufacturing andExpenditures75

E1.10 Carbon sink
E3.3 Ecological restoration and governanceE3.6 Environmental activities

Shanghai Stock Exchange Listed Company Environmental Information
Disclosure Guidelines

Conserving theEnvironment

119

E1.2
E1.3
E1.4
E1.5
E1.7

Green Management

E2.1

Environmental protection early warningand emergency response mechanism
Environmental technology R&D andapplication
Methodology of statistical assessment
system for environmental indicators
Environmental training and education
Support the development of green and lowcarbon industries
Green design

E1.8

160

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Manufacturing Sites
USI
SHANGHAI-ZHANGJIANG
No.1558, Zhang Dong Road, Pudong New Area, Shanghai 201203,
China
Tel: +86-21-5896-6996

SHANGHAI-JINQIAO
No.501, Longgui Road, Jinqiao Export Processing (South) Zone,
Pudong New Area, Shanghai 201201, China
Tel: +86-21-3813-6668

SHENZHENUSI Electronics Park, 9028 Beihuan Boulevard, North of High- Tech
Industrial Park, Xili, Nanshan District, Shenzhen 518057, China
Tel: +86-755-6182-1666

HUIZHOU
No.369, Xinhe Boulevard, West District Daya Bay, Huizhou City,
Guangdong Province 516000, China
Tel: +86-752-5830-888

KUNSHAN
No.497 Huangpujiang Road, Qiandeng, Kunshan, Jiangsu Province
215341, China
Tel: +86-512-5528-0000

161

Asteelflash
TSAOTUENASTEELFLASH TECHNOLOGIES

No.141, Lane 351, Sec. 1, Taiping Road, Tsaotuen, Nantou County
542007, Taiwan
Tel: +886-49-221-2700

Rue de Gâtel, ZI Nord, Pôle activités d'Ecouves, 61250 Valframbert,
FranceTel: +33-2-3380-3450

NANKANGASTEELFLASH ATLANTIQUE

No.300, Gongye Road, Nantou City, Nantou County 540027,
TaiwanTel: +886-49-221-2699

Le Clos de La Grée, 35660 Langon, France
Tel: +33-2-9908-6666

ASTEELFLASH ESTMEXICO
Anillo Periferico Manuel Gomez Morin No. 656, Jardines de Santa
Isabel, C. P. 44300,
Guadalajara, Jalisco, Mexico
Tel: +52-33-3648-1800

POLAND9, rue Ampère, 67120 Duttlenheim, France
Tel: +33-3-8804-6450

ASTEELFLASH DÉVELOPPEMENT
43, chemin du Vieux-Chêne, 38240 Meylan, France
Tel: +33-4-7663-3350

ul. Innowacyjna 4, 55-040 Biskupice Podgórne, Lower Silesia,
PolandTel: +48-71-769-4720

ASTEELFLASH LORRAINEVIETNAMASTEELFLASH NORMANDIE

Lot CN4.1H Dinh Vu Industrial Zone, DinhVu-Cat Hai Economic
Zone, Dong Hai 2 Ward, Hai An District, Hai Phong City, Vietnam
Tel: +84-225-3859989

49, rue de la République, BP 26, 76250 Deville-Les-Rouen, France
Tel: +33-2-3210-7000

ZA Champs de l'Etraye, 88120 CLEURIE, France
Tel: +33-3-2928-8888

About this Report

Operation and
Governance

Sustainability
Management

Green Products
and Innovation

Value Chain
Management

Environmental Protection
and Occupational Safety

Inclusive
WorkplaceSocialInvolvement

Appendix

Sales Offices
HEADQUARTERASTEELFLASH ÎLE-DE-FRANCEASTEELFLASH PLZEN

Zone Industrielle, BP 5, 02200 Mercin Et Vaux, France
Tel: +33-3-2375-5800

Podnikatelská 1227/ 24, 301 00 Plzen, Czech Republic
Tel: +420-373-740-905

ASTEELFLASH BAD HERSFELDASTEELFLASH LA SOUKRA

Konrad-Zuse-Straße 19-21, 36251 Bad Hersfeld, Germany
Tel: +49 (0) 6621-84-201

104 Avenue de l'UMA - 2045 Soukra, Tunis, Tunisia
Tel: +216-36-066-015

ASTEELFLASH BONN

ASTEELFLASH FREMONT

Allerstraße 31, 53332 Bornheim – Hersel, Germany
Tel: +49 (0) 2222-9964-101

4211 Starboard Drive, Fremont, CA 94538, USA
Tel: +1-510-440-2840

ASTEELFLASH EBERBACH

ASTEELFLASH TIJUANA

Neuer Weg-Nord 49, 69412 Eberbach, Germany
Tel: +49 (0) 6271-81-200

Avenida Producción No. 5-A Parque Industrial Finsa, 22427
Tijuana, B.C., México
Tel: +52-664-231-5007

ASTEELFLASH DESIGN SOLUTIONS HAMBURG
Meiendorfer Straße 205, 22145 Hamburg, Germany
Tel: +49-040-2022-997-363

ASTEELFLASH BEDFORD
Unit 1 and 2 – St Martins Way, St Martins Business Centre,
Bedford MK42 0LF, UK
Tel: +44-1234-216-222

ASTEELFLASH SUZHOU
No.8 Gutang Road, Wujiang District, Suzhou, Jiangsu Province
215200, China
Tel: +86-512-6340-8000

No.169, Shengxia Road, Pudong New Area, Shanghai 201210, China
Tel: +86-21-5896-6996

HONG KONG
Unit A, 7 / F., Yuen Long Hi-Tech Centre, 11 Wang Yip Street West,
Yuen Long, New Territories, Hong Kong
Tel: +852-2109-0166

EUROPE
Waterloo Office Park - Building M, Drève Richelle, 161, Box 23,
B-1410 Waterloo, Belgium
Tel: +32-2-647-8461

USA4211 Starboard Drive, Fremont, CA 94538, USA
Tel: +1-510-440-2840

JAPAN
Sumitomo Fudosan Shin-yokohama Bldg. 10F 2-5-5, Shin-yokohama,Kouhoku-ku, Yokohama, 222-0033, Japan
Tel: +81-45-478-7317

SINGAPORE
3 Fusionopolis Link #02-10, Nexus@One-North, South Tower,
Singapore 138543
Tel: +65-6500-1310

TAIPEI
Room 6, 3F, No.66, Sanchong Road, Nangang District,Taipei 115602, Taiwan
Tel: +886-2-2782-0366

162

20 21 Paper from responsible sources and printed with EU RoHS compliant toner.

Published by

Universal Scientific Industrial (Shanghai) Co., Ltd.

PublisherJeffrey Chen / C.Y. Wei

Address

No.1558, Zhang Dong Road, Pudong New Area, Shanghai 201203
No.141, Lane 351, Sec. 1, Taiping Rd., Tsaotuen, Nantou 542007

Telephone+86-21-5896-6996+886-49-235-0876

Editorial
Supervisor

QA&CSR / S&HS / CSR

Editorial Design

President Office

Editor-in-Chief

Otto Yu

Senior Editor

Yunren Lee

Executive Editors May Lee / Nancy Lin / Chingyi Lin / Water Liu / Momoco Chang /Joanna Wei / YuAn Chen / YuJing Yeh
Web Editors

Ticky Wang / May Lee / Nancy Lin / Chingyi Lin / Water Liu /Momoco Chang / Joanna Wei / YuAn Chen / YuJing Yeh

Websitehttps: // www.usiglobal.com/csr

Editorial
Committee

Stanley Lee / Janice Chen / Lois Lin / Mosa Lin / CMH / Sherry Hsu /Lily Liu / Lisa Huang / Jason Zhang / Andy Leu / Susan Yang / Andy Chu /Justin Chen / Martin Lai / Emmy Yang / Will Liu / Jung Hui / Terrence Lee /Andy Lin / Litong Lin / Tim Lee / SP Tang / Chaofu Huang / Enoch Liu /Carson Cao / Liwei Wang / Peng Su / Andy Liu / Rita Yu / Achung Lin /Brendan Yao / SW Tsai / Irene Chang / Nancy Chang / Luan Hsieh /CW Fu / CJ Liu / Craig Shih / ST Chen / Cindy Chang / Sin Bai / Juan Morfin

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