i編輯原則 - cpttcpt invited experts and scholars to engage in discussions of key issues arising...

編輯原則

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編輯原則

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EDITORIAL POLICYThis is the fourth CSR Report published by Chunghwa Picture Tubes, Ltd. (“CPT” henceforth) since our first issue in 2008. The 2011

CSR Report was compiled based on the results of stakeholder surveys conducted by the respective departments in Quarter 1 of 2012. CPT invited experts and scholars to engage in discussions of key issues arising from the surveys in Quarter 1 of 2012, to determine the report framework.

CPT expects to be capable of achieving more comprehensive and systematic reporting to stakeholders on the various dimensions of the company’s business management including economic, social, employee, environmental, and safety and health. In addition, we endeavor to engage in more transparent disclosure of the results of and our efforts in achieving sustainable development.

To address version 3.1 of the sustainability report released by the Global Reporting Initiative (GRI) in March 2011, the revision focuses on issues such as human rights, impacts on local communities, gender. A total of 16 indicator criteria and 5 indicators are established, while relevant changes and new indicators have all been included in the scope of this report’s disclosure, resulting in more transparent disclosure and enabling different stakeholders to access this information.

Reporting FrameworkWe continue to adopt the “MUST” (Management, User’s

Response, System, Things / Action) framework previously discussed by our senior executives in the 2011 CSR report. Continued adoption of this framework not only means that CPT is moving towards more systematic, strategic and coherent CSR management, but also reflects our Commitment towards fulfilling our corporate social responsibilities. CPT’s representatives from the various departments collaborated with external experts to form the Green Management Committee, which is solely responsible for propagation of the company’s CSR initiatives, preparation of CSR reports and planning of the policy and objectives of the company’s future CSR initiatives.

Period Covered by the ReportThe reporting period is from January to December 2011.

Certain information on the company’s CSR activities conducted prior to December 2010 and after January 2012 was included in the report for completeness. This CSR report not only showcases the company's performance but also covers our future plans and projections. The abovementioned assumptions and judgments were relevant according to the circumstances applicable at the time when the report was published. Future activities and the corresponding results could differ from our projections.

Reporting Guidelines and ReliabilitySustainability issues and the corresponding strategies,

goals and measures disclosed in the “2011 Chunghwa Picture Tubes CSR Report” are in conformity with:

● The G3.1 Guidelines of the Global Reporting Initiative (GRI G3.1);

● “Corporate Social Responsibility Best Practice Principles for TWSE/GTSM-Listed Companies”

For the purpose of improving information transparency and reliability, this report has been verified by SGS Taiwan Ltd., to meet the contents and quality requirement of Application Level A+ of GRI G3.1 and Type 1, High Assurance Level of Accountability of AA1000 Assurance Standards 2008.

Boundary and ScopeThe 2011 Corporate Social Accountability Report covers

the corporate social accountability performance of CPT Co., Ltd. and CPT Technology (Group) Co., Ltd.

The scope of report underwent certain changes from 2010, the primary reasons being: CPT (Malaysia) Co., Ltd (including the Malaysia plant and the Kampar plant in Malaysia) was sold in January 28, 2011. Therefore, the disclosure report in 2011 does not include plants in the Malaysia region.

Report Cycle CPT undertakes to continuously publish the annual CSR report each year. Current issue: August 2012. Next issue: July 2013 (projected). (Previous issue: July 2011)

Contact Information We welcome your comments and questions. Our contact details are as follows:Chunghwa Picture Tubes Ltd.Sustainable Development Section of the Risk Management Department, Safety and Health Head OfficeNo.1127, Heping Rd., Bade City, Taoyuan, TaiwanTelephone: 03-3675151 ext. 3620Fax: 03-3773129E-mail : [email protected]: http://www.cptt.com.tw/

Taiwan China

CPT Co., Ltd.●Taoyuan Plant●Longtan Plant●Yangmei Plant

●CPT Optronics CO.,LTD● CPTF Visual Display (Fuzhou) Ltd.

CPT Technology (Group) Co., Ltd. None

● Chunghwa Picture Tubes (Wujiang) Ltd.● CPT Display Technology (Fujian) Ltd.● CPT Display Technology (Shenzheng) Ltd.●CPT TPV Optical (Fujian) Co., Ltd.

In September 2008, the financial crisis invaded the world. Then, in the fourth quarter of 2009, the debt crisis of the major powers in Europe erupted, which continued to this day. The world economy still had not recovered from recession. In the face of deteriorating industry conditions, CPT determined its transformation objectives in 2009 in order to improve the efficiency of the company’s operations. After two years of product transformation, all foundational elements have been consolidated in 2011. In terms of product, sale, and warehousing, we have successfully brought the corporate resource planning system online, further streamlining the overall product, sale, and warehousing process. In terms of reorganization, we have actively engaged in restructuring to effectively apply the company’s idle assets and resources, which yielded significant results in lowering production costs and operational expenditures. In terms of product transformation, our small and medium size products have, for the first time, surpassed the large size products in revenue. Meanwhile, production by area for base boards of small and medium size products across the company had also achieved numerous records. We will consolidate all preparations for the execution of our mission, resolve challenges in all aspects, and eventually turn deficits into profit and re-establish CPT’s reputation.

The Green Management Committee, formed by high level managers of CPT, insists on the spirit of “Green Life, Green World.” Our low carbon corporate action plan (henceforth abbreviated as Green Actions) is primarily intended to promote “green production” in terms of products and “low carbon actions” in terms of lifestyle. Our target is to achieve an overall 22% carbon reduction across the company from 2008. This target was achieved at the end of 2011, where the company achieved an overall 23% in carbon reduction, further proving Green Management Committee’s success in introducing green concepts into corporate business strategies and turning such concepts into real action that is gradually taking root and strengthening within all departments. In 2011, CPT’s green products also performed well and yielded results in many events, including: 1st Taiwan Green Classics Award, carbon and water footprint certification for 6.9 inch circuit boards for small and medium vehicles, participation in the voluntary packaging reduction agreement with the Environmental Protection Administration, Taiwan Excellence Awards, etc. CPT continues to move towards becoming a green corporation. In 2012, CPT introduced the concepts of “CPT Low Carbon Sustainable Development Plan,” which utilizes the concepts of “green actions = innovations = commercial opportunities = sustainable development” to introduce green strategies into all aspects of the company’s operations.

Being part of the major supplier chain system, and also a global ODM or OEM suppliers for LCD products around the world, CPT is deeply affected by environmental effects. Therefore, CPT has addressed international green trends and client demands in its establishment of dedicated green management plans to fulfill green and sustainable business management, ensure harmonious coexistence with the Earth’s environment, and fulfill the objective of sustainable use of the Earth’s resources. Also, CPT will also undertake environmental leadership and simultaneously engage in green actions with CPT’s stakeholders. Only by shaping CPT into a “green low carbon sustainable development base” and actively striving to create a “green service tourism factory” with a vision for local happiness can green procurement demands from clients be satisfied. By building on the global environmental trend, we can control the rise of green commercial opportunities and become a major force in the green economy.

Wei-Shan Lin, The Chairman

Letter from the Chairman

CONTENTS

Management ofSustainability Issues

Reducing Energy and Resources Consumption, Develop Environmentally Friendly Products

Provide High Quality Green Products, Winning Customer Recognition

Encourage Suppliers’ Green Management and Green Services

Establish LOHAS Working Environment and Voluntary Environmental Conservation

Work with Employees to Care for Neighboring Community and Establish Green Image

Corporate GovernanceGreen Management CommitteeStakeholder EngagementRisk ManagementRespect for Intellectual Property Rights and Fair Competition

Project 335Carbon ManagementWater Resources ManagementOutline of Material FlowEnvironmental Risk Assessment and Communication Resource Reduction and ReuseAir Pollution Prevention

Customer Relationship ManagementInnovative Materials and Technology R&DR e d u c e R e s o u r c e C o n s u m p t i o n a n d Implement Easy Recycle Design Reuse of MaterialsRecycle and Reuse of Chemicals

Scoring, Auditing and Assistance onMeeting Green Product RequirementsImplementation of EICCGreen & Local Procurement

Management of CharityActivitiesMain CSR EventsIntegration into Local Communities

Protection of Human RightsEmployee Health ManagementOccupational Hazard PreventionTraining and Attracting TalentsCaring for Employees

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Company Profile

Establishment and GrowthMajor Events in 2011Our ProductsFinancial Highlights

4

Assurance Statement

GRI G3.1 Index

Editorial Policy

Letter from the Chairman

Company ProfileChunghwa Picture Tubes, Ltd. (henceforth abbreviated as “CPT”) was founded on May 4, 1971. The company’s shares were listed on the Taiwan Stock Exchange on September 17, 2001 (stock code: 2475).CPT’s primary operations in the Taiwan region includes research, production, and sales of thin film transistor – liquid crystal displays (TFT-LCD) and color filters (CF) for IT and medium and small base board applications. CPT Technology (Group) Co., Ltd was officially founded in January 2011 (stock number 000536), whose primary operations include rear model assembly of TFT-LCD. In 2011, CPT took leadership in the industry by producing medium to small base board products through sixth generation production lines, as well as actively engaging in vertical integrations of medium to small board boards.

2011 Corporate Social Responsibility Report6

Establishment and Growth

CPT was the first manufacturer in Taiwan to introduce the technologies for the production of picture tubes, large-sized thin film transistor liquid crystal display, thin film transistor liquid crystal display (TFT-LCD) and Plasma TV. In future, CPT will remain devoted to managing our internal operations and flexibly adjusting our product portfolios to manufacture products with high added values but our primary business focus will be on small and medium-sized display panels and touch screens.

Management Philosophy

2011 coincided with the 40th anniversary since the founding of CPT. As CPT’s internal culture is reformed in the midst of external environmental changes, the corporate culture of “propriety, honesty, diligence, and frugality” and the business principle of “innovation, perfection, and teamwork” are combined and upgraded to the six major “core values” to act as the foundational guidelines for CPT’s future operations and management.

● Corporate Vision: To pursue the physical and mental happiness of employees, and to contribute to the progress of society.

● Corporate Mission: To seek stability and profitability, to sustain growth, to innovate relentlessly, and to fulfill corporate social responsibility.

● Quality Policy: Customer First, Full Involvement and Zero Defect.

Promoting a Culture of AccountabilityIn 2011, CPT actively promoted an internal culture of

accountability, which consists of the six major core values of timeliness, accountability, accountability, innovation, cooperation, and compassion. These core values are also infused into the DNA of CPT’s employees. Work is divided according to the ARCI principle to reduce grey areas and improve the overall executive efficiency of all projects.

CPTCore Values

Innovation

Agile

Integrity

Cooperation

Accountability

Passion

● Agile Rapid reactions are required to address changes in business strategies in order to capture winning opportunities.

● Accountability Pursuit of perfection in work is upgraded to One More Ounce to enhance executive capabilities, fulfill accountability, and produce concrete fruition.

● Innovation Innovation is upgraded to reform to actively exceed current conditions and address severe market challenges.

● Passion Create joyful working environments, inspire passion from employees to address challenges, and introduce positive thinking.

● Cooperation Teamwork is upgraded to interdepartmental coordinated cooperation and integration to increase organizational efficiency.

● IntegrityFocus on appropriate business operations, encourage ethical services, and maintain accountable practices, in order to fulfill the foundational spirit of “propriety, honesty, diligence, and frugality.”

3 Stages of Promoting Culture of Accountability

2013

2012

2011

Training Application Culture

Understanding Reponsibility

Introduction of External Training Resources

Internal Education through Seed Instructors

Incorporation of Examination Systems

Assisted Practical Experience

Establishment and Presentation of

Accountability Awards

Appreciating Accountability

Classes Held by Internal Seed

Instructors and Augmented by

Practical Experience to Act as Case Studies

Fulfilling Accountability

Electronic Accountability Classes

Classes from Internal Seed Instructors

Assistance with the 10 Major Corporate ProjectsEstablishment of ARCI

TeamConference of

Accountability Results

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Com

pany Profile

Managem

ent of Sustainability Issues

Reducing Energy and R

esources Consum

ption, D

evelop Environmentally Friendly Products

Provide High Q

uality Green Products,

Winning C

ustomer R

ecognitionEncourage Suppliers’ G

reen Managem

ent and G

reen ServicesEstablish LO

HA

S Working Environm

ent and Voluntary Environm

ental Conservation

Work w

ith Employees to C

are for Neighboring

Com

munity and Establish G

reen Image

Expected Targets and Benefits of CPT Corporate Resource Planning SystemSatisfy Management Requirements and Integration of Multifaceted Industries (Purchase, Sale, Processing, Product Differentiation, Regional Differentiation)

Integration of Corporate Groups between China and Taiwan

●Linked information for integrated procedures●Joint information integration for rapid flow and process● Integration and application of group management

information

●Different management models for different corporate groups●Planning and management coordinated with profit center (such as precision machinery plants)●Integration and diversified application of shared information between different corporate groups

Financial Forecast Capabilities

● Global corporate operational platforms (includes multiple exchange rates / currencies / accounts / GAAP / international and intercontinental transactions)

●Compliance with IFRS regulations●Analysis of product costs, pricing, and profit capabilities

Operational Performance

●Shortened decision time●Shortened accounting time●Increased product warehousing flow●Improved operational procedures

Management strategy

President’s Message Mr. Sheng-Chang LinCreate Green Supply Chains and Insist

on Sustainable DevelopmentCPT plays a major connecting role in the display industry. We insist on the principle of “green and sustainable

development” as we introduce innovative green concepts into product life cycles, from R&D, material procurement,

manufacturing production, usage, and down to disposal phases. We hope to minimize the

environmental impacts of our products. We will not only exceed the environmental requirements of

our clients, we also encourage our suppliers to work together for green technologies. We hope to

create a green supply chain and become a leader in green visual information industries.

Internally, the Green Management Committee successfully introduced green concepts into

CPT’s corporate business strategy, and turned them into action that is growing

steadily within all of CPT’s departments. In the future, CPT will establish

dedicated green management plans, fulfill green and sustainable business

management, fulfill its corporate social responsibilities, simultaneously

assist CPT’s stakeholders with engaging in green action, and

coexist harmoniously with the Earth’s environment.

Establishment of the ERP SystemFor the purpose of improving our operational efficiency,

CPT has adopted measures to reduce the overall costs of operation, improve operating profits, enhance coordination in production and marketing and the functioning of the supply chain, de-stock and improve inventory turnover, integrate IT systems and enhance the group’s global logistics support

capabilities. CPT began the construction of the ERP system in September 2010, and completed all phases of the project. In July 2011, the system was brought online. Subsequently, the Shenchuan plant was brought online in January 2012. In the future, CPT will become more competitive under the operation of the SAP ERP system.

Process integration

Financial management


C P T o n c e a g a i n signed the “voluntary packaging reduction a g r e e m e n t ” w i t h the Environmental P r o t e c t i o n Adminsitration of the Executive Yuan

C P T ’ s M i n d o n g Electronics (Group) Co., Ltd. in the China region was renamed as CPT Technology (Group) Co., Ltd.

2011 Sustainability Forum of Suppliers of CPT

CPT joins the run for the safe ty, h e a l t h , a n d env i ronmenta l activities of Earth Day

P a r t i c i p a t i o n i n t h e 2011 flat screen display exhibition of Taiwan

CPT processes its plant assets in Malaysia

CPT turns 40! “It’s Good to See You” series of events

The 4.8 inch naked eye high resolution 3D display, 10.1 inch L C L e n d s n a k e d eye 3D display, 10.1 inch 4-view parallax barrier naked eye 3D d i sp lay, 15 .6 inch l iquid crystal polarized 3D display module, and 21.5 inch polarized lends 3D display module have all won the 19th Taiwan Excellence Awards

P r e s e n t e d w i t h the“Outstanding Unit in Corporate Group of the Northern Region o f t he 2011 Ene rgy C o n s e r v a t i o n a n d Carbon Reduction Action Awards" from EPA.

Awarded with the first phase 3 million man hour incident-free certificate from the Council of Labor Affairs

Presen ted w i th the “Outstanding Award” among governmental corporat ions (Team A) from the national occupatm8ional health and safety week from the Council of Labor Affairs

Presented with the “5-Star Outstanding Performance U n i t Aw a r d f o r L a b o r Health and Safety” from the Council of Labor Affairs of the Executive Yuan

Aw a r d e d w i t h t h e 1 a c t i o n o u t s t a n d i n g performance unit award from the Taiwan Business Council for Sustainable Development

Major Events

Awards Won

January

Major Events in 2011

1

3

4

5

53 4

21

2

February March MayAPril June

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Com

pany Profile

Managem



esources Consum

ption, D


Provide High Q


Winning C

ustomer R


reen Managem

ent and G


HA

S Working Environm


ental Conservation

Work w

ith Employees to C

are for Neighboring

Com


reen Image

C o r p o r a t e r e s o u r c e planning system officially brought online

CPT’s Taoyuan plant p a r t i c i p a t e s i n t h e establ ishment of the energy management system ISO500001 as part of Taoyuan County’s industrial energy, carbon, and water conservation project

Cultural performance – “Song of the Wandering Dog” from Ruguo Children’s Theatrical Group was held

2011 CPT Family Day was held as part of the “It’s Good to See you as CPT Turns 40” events

CPT’s 6th generation e n t e r e d t h e c e l l phone market

CPT’s precision machinery’s self-manufactured machines passed the SEMIS2 certification

C P T ’ s t e a m participates in the swimming event across Sun Moon Lake

EInk and CPT joins in strategic partnership to develop the global electronic paper and FFS technology markets

CPT and Intel lectual Ventures (IV) sign the multifaceted Intellectual Patent agreement

CPT was nominated by the Bureau of Health Promotion as an outstanding workplace, and worked on the Bureau of Health Promotion’s publication – “100 Stories of Love”

21.5 inch USB wireless energy efficient monitor won the “1st Taiwan Green Classics Award” from the Bureau of Foreign Trade of the Ministry of Economic Affairs

Presented with the “Outstanding Family Protection Award” by the Counci l of Labor Affairs of the Executive Yuan.

P r e s e n t e d w i t h the annual “Group H e a l t h Aw a r d o f National Outstanding Healthy Workplaces” from the Bureau of Health Promotion

● CPT’s 6.9 inch vehicular

b a s e b o a r d p r o d u c t s passed the product-based carbon and water footprint certifications

● C P T r e c o m m e n d e d b y

Taoyuan County’s Bureau of Health as a weight loss workplace

● CPT presented wi th the

national occupational weight loss performance award from the Bureau of Health Promotion of the Department of Health of the Executive Yuan

● CPT presented wi th the

“2011 Outstanding Water Conservation Unit” by the Water Resources Agency of the Ministry of Economic Affairs

● Presented with the “Health

Innovation Award” from the Taoyuan County government in the 2011 “Taoyuan Slim Athletic Competition”

CPT pa r t i c i pa ted i n the Taipei international marathon and won the “Hea l t hy En te rp r i se Award”

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8

9

10

6 7 8

10 119

11

July OctoberSeptember November December


Our ProductsFrom 2010 to 2011, CPT underwent production line changes. At the same time,

with increased production in medium to small base boards and improvements in product combinations, production area for medium to small products reached 77% , including TSP, cell phones, digital cameras, vehicular products, HFFS, flat screen computers, etc. In 2011, total sales in small size products reached 480 million units, the highest in the world.

Utilization of Product Line AdvantagesLooking into the market in 2012, growth potential is

mostly concentrated in touch activation, smart phones, flat screen computers, light laptops, and other smart products. CPT will capitalize on its existing advantage in small and medium product lines to continue focusing on developments in small and medium products.

1.Products:● Small and medium products: increase base board

production ratios, as well as increasing production ratios for 4.5 generation 0.3T glass. We will aim for a resolution of 300ppi or more. Plans are complete for production of 6th generation small and medium products. Smart phones of 5 inches or smaller are introduced, while HFFS board production ratio will continue to be increased.

● Large products: simplify large product lines, focus on producing light weight notebook computers.

● Touch activation products: steadily increase cliend orders from international cell phone brand. 7 million units can be achieved in one month.

● Enhance downstream outlets: increase HFFS and EPD production with cooperation with strategic partners.

2.Product Lines:CPT is actively upgrading technologies and adjusting

product combinations. Other than the initiating production of 6th generation battery-powered projection touch screens, we have also taken leadership in the industry in branching out to production of high level smart phones.

Transformation ResultsCPT uses the existing advantage of its current product

line on small and medium applications to actively engage in technological upgrades and product differentiation, and thus expand its market share in small and medium products. Strategic results of transforming into small and medium products include:

(1) Medium size developments: the effects of strategic partnerships are gradually harnessed. Other than stable production of EPD through cooperation with EInk, we are also working with Hydis to jointly develop 7 inch / 10.1 inch HFFS flat screen models, which was successfully shipped to clients of global brands in 2011. At the same time, we are more actively developing high resolution products (250~300 PPI) for flat screen computers, which work with Android and Windows 8 systems.

(2) Vehic lu lar base boards: af ter many years of technological upgrades and quality improvements, our products are successfully introduced into Japan’s vehicular platform market, becoming a major supplier. In 2011, we have further expanded from rear markets to front markets, successfully acquiring certification and mass production usage certifications from major Japanese and American automakers. In 2011, we have shipped over 2 million units.

(3) Small size developments: the 6th generation had entered the high end smart phone market, successfully developing 3.5 inch smart phone base boards, while further challenging high resolutions (WVGA) of base boards of many smart phones models of 4 inches or larger, the development of which is complete, and are now in mass production.

In-Cell Touch technology makes screen lighter and more fun to operate.President Ma attends the flat screen display exhibit, and is accompanied by the Chairman and President during the tour.

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pany Profile

Managem



esources Consum

ption, D


Provide High Q


Winning C

ustomer R


reen Managem

ent and G


HA

S Working Environm


ental Conservation

Work w

ith Employees to C

are for Neighboring

Com


reen Image

Financial Highlights

CPT is fully committed to consolidating its TFT-LCD operations, utilizing warehousing controls and cost adjustments to increase profits. By understand clients from different regions and industries, we can adopt various methods to provide different clients with products and services that they truly need. As we steadily fulfill CPT’s corporate directions, we share our fruition with all of our employees, who work together to make the best of CPT.

2009 2010 2011

Consolidated Financial Results

Net Sales

Gross Profit

Cost of Operation

Net operating profitNet income before tax of continuing operationsNet income a f te r tax o f continuing operations

Personnel Expenditure

48,322,679

-21,847,346

-70,170,025

-29,582,890

-38,347,074

-38,016,886

7,429,463

81,691,727

-4,080,665

-85,772,392

-13,573,336

-14,228,091

-15,677,527

8,485,541

61,471,398

-67,103,520

-5,632,122

-14,140,889

-11,483,636

-12,479,920

8,016,693

Note: Personnel expenditure includes salaries, health and labor insurance fees, pension expense and other personnel expense. Appropriation of earnings including earnings set aside as legal surplus, cash dividends and employee bonuses. During the period from 2009 to 2011, CPT did not make an appropriation of earnings or issue employee stock options.

Continuous Improvements of Profitable CapabilitiesCPT’s business holding company is Tatung Co., which

holds 8.46% of all of CPT’s shares. In 2011, CPT’s plants in Taiwan incurred losses, and therefore did not need to pay taxes and did not receive financial assistance from the government. The Fujian Huguan plant, Wujiang plant, Fujian CPT Display Technology Plant, Shenchuan Plant, and Fuzhou CPT Visual Information Plant in China received approximately $RMB 3.78 million in property tax exemptions from local governments. The Fujian Hugan plant, Wujiang plant, Fujian CPT Display Technology Plant, Shenchuan Plant, and Fuzhou CPT Visual Information Plant received approximately $RMB 15.45 million in income tax exemptions from local governments.

CPT and its subsidiaries earned a total net revenue of $NT 61.47 billion in 2011, over 95% of which came from its TFT-LCD business. 15.68 million units of large size TFT base board units were shipped out, while 480 million units of small and medium size base boards were shipped out. Facing global economic uncertainty, excessive supplies in the base board industry, and intensifying competition, base board prices did not recover well. Therefore, CPT incurred a net loss of $NT 12.48 billion in 2011.

Global DeploymentUnder such rapidly changing environments, CPT is

committed to defending its developments and operational targets in the TFT-LCD industry as it continues to engage in technological improvements and innovations while successfully acquiring technical ptents through strategic partnerships with downstream outlets to develop products that are more compatible with market trends. Improving product combinations, expanding FFS flat screen computer base boards, smart phone base boards, vehicular base boards, electronic paper (EPD), Array back board and touch screen production, and upgrading industrial technologies are all targets that CPT has currently committed to and achieved. CPT will continue enhancing quality and quantity at the same time, strive for new records, and actively improve its profitable capabilities.

In the future, medium and small size applications and portable information technology applications will grow rapidly. Currenly, the 6th generation line possessed by CPT address the productive economic benefits of these two major applications precisely through technological upgrades and prodict development. After acquiring certifications from major international brand manufacturers, operational risk can be adjusted to account for seasonal fluctuations in market demand, and at the same time enable active development of highly profitable and emerging products. Also, in terms of working with vertical upstream and downstream integration, CPT is not only accelerating the unification of integrated touch activation technology and enhancing autonomous corporate production of LED rear illumination devices, it is further actively incorporating strategic partnerships with downstream packaging and brand manufacturers, which can greatly reduce material cost and ensure sale of products.Note: the percentage of shares held by legal entities increased in 2009

due to issuing private common bonds.

2009 0.00 4.84 35.67 49.57 9.65 0.27 100.00

2010 0.00 0.02 37.63 49.57 12.51 0.27 100.00

2011 0.00 0.02 37.10 52.93 9.95 0.00 100.00

Shareholder Composition (ownership %)

Year

Unit: New Taiwan Dollar (Thousands)

Shareholder Composition Government

AgenciesFinancial

InstitutionsOther Legal

Entities IndividualsForeign

Institutions and Aliens

Treasury Stock

Total

Management of Sustainability IssuesSince 2008, CPT initiated the “Social and Environmental Responsibility (SER) Plan,” which received an external verification report from the Electronic Industry Citizenship Coalition, making CPT the first opto-electronics company in Taiwan to receive this external VAR verification report. CPT plans to expand EICC regulations, product-based carbon footprint investigations, banned materials regulations for products, and greenhouse gas investigations and reduction to its suppliers and contractors in hopes that CPT’s supply chain can move towards sustainable development.

14 2011 Corporate Social Responsibility Report

Corporate Governance

CPT adopts the corporate culture of “Integrity, Honesty, Diligence and Frugality.” This is our non-negotiable corporate spirit. In 2011, CPT developed new core values, including accountable management to effectively empower a culture of accountability. In terms of legislations, CPT strictly complies with the relevant regulations. We perceive legal compliance as the fundamental requirement to exercise ethical management.

Organizational Structure of CPT

Note: Effective from May, 2012

Operation of Board of DirectorsCPT’s Board of Directors is the ultimate body responsible

for the company’s management. The Audit Committee operates under the Board of Directors, responsible for carrying out audits on the company’s management systems and operational procedures. The Chief Executive Officer (CEO) is a position appointed by the Board of Directors to support the Chairman, and is responsible for planning the company’s future operational development and management strategies. At present, CPT’s Chairman serves concurrently as the CEO.

Board meetings are convened at least once each quarter. The Board is dedicated to managing the company’s operating performance and maximizing returns to shareholders. Recusal policy for directors in the “Procedures for Board of Directors Meetings” stipulates that if an interested party relationship exists between any director, or a juristic person the director represents, and any agenda item, and such relationship is likely to prejudice the interests of the company, the director may state opinions and answer questions but may not participate in discussion of or voting on that agenda item, and shall recuse themselves during discussion of and voting on that item, and may not act as the proxy of another director to exercise voting rights on that matter.

Article 15-2 of CPT’s Articles of Incorporation provides that the company may take out an insurance policy to protect directors and supervisors from liability arising out of their duties

as directors and supervisors during their tenure of office. CPT has been taking out indemnity insurance for our directors and supervisors since 2006.

In May 2010, Chairman, directors and supervisors of CPT were re-elected by the general shareholders’ meeting. Also, CPT still maintains 5 seats for Supervisors, 1 seat for a female Director, and 2 Supervisors. On January 28, 2011, 1 independent Director resigned. A total of 9 Board meetings were held in 2011, with an attendance rate of 75% for Directors and 82% for Supervisors.

CPT’s management team consists of directors, supervisors and officers serving as the vice presidents or more senior positions. In 2010 and 2011, CPT paid out approximately $NT 30 million and $NT 50 million, respectively, in salaries, bonuses, expenses, operational funds, special funds, and profit sharing for the aforementioned primary management levels.

Audit Committee

Health and Safety Division

Chairman

Board of Directors

Shareholders’Conference

Compliance Office

Office of the President

President

Invested Industries

Touch A

ctiv

atio

n

Industry

Departm

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Larg

e S

ize In

dustry

D

epartm

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Mediu

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Industry

Departm

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Sm

all S

ize In

dustry

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epartm

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Manufa

ctu

ring

Opera

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Quality

Contro

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Pro

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Departm

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Fin

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Managem

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Departm

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Stra

tegic

Investm

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Managem

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Departm

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Legal A

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Title NameChairman Chunghwa Electronics Investment Co., Ltd Representative: Wei-Shan Lin

DirectorChunghwa Electronics Investment Co., Ltd Representative: Wen-Yen Lin K.Chunghwa Electronics Investment Co., Ltd Representative: Wen-Chieh PengCompal Electronics Inc. Representative: Zhen-Chang Xu, Ching-Zhang Wen

Independent Director Chien-Chung Yuan;Chien-Ho Chao;Yu-Yuan Tsai;Ping Chu;Te-Cheng Tu

SupervisorGreen Energy Technology Inc. Representative: Shu-Hua LiaoGreen Energy Technology Inc. Representative: Chang-Chieh YangLung-Chieh Wang; Tung-Fa Chi; Chiu-Rei Wei

Composition of CPT’s Board of Directors

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Code of ConductCPT has put in place the “Anti-Bribery Policy” and “Work

Rules,” clearly stipulating that all employees are prohibited from directly or indirectly accepting any form of unreasonable gift, entertainment or other improper benefits for personal gain, which may potentially put the company’s rights at stake. In addition, the company’s “Procedures for Handling of Material Internal Information” clearly stipulate that directors, supervisors, managers, and employees of the company shall neither disclose any material internal information known to them to others, nor shall they attempt to enquire or gather undisclosed material internal information unrelated to their work from individuals who have knowledge of such information. Anyone who gains knowledge of undisclosed material internal information by non-work related means is prohibited to disseminate such information to others.

All supervisors and employees shall abide by the “Principles for Managing Acceptance of Monetary Benefits and Entertainment” put in place by CPT in 2007 when promoting business and handling administrative matters. Tatung Co., the parent company of CPT, issued a “Corporate Ethics Statement” on April 9, 2010 to all employees of the group, to govern the conduct of all employees. Contents of the “Statement” are as follows:

Employees of the Tatung Group shall, during their period of employment with the Group, exercise the highest standards of ethics and responsibility, abide by rules, remain dedicated to service, act ethically and with integrity, and strictly comply with laws and regulations. All employees are reminded at all times to place personal and the Group’s pride above all else by upholding the spirit of “Integrity, Honesty, Diligence and Frugality” to support sound performance, to establish the Group’s social credibility and to abide by the Work Rules.

CPT is constantly promoting the “Principles for Managing Acceptance of Monetary Benefits and Entertainment” within the company through the company’s intranet. All employees in the Taiwanese and Chinese plant areas are receiving EICC education, which covers anti-corruption issues. Currently, training completion rate is 100% in Taiwanese plant areas and 76% in Chinese plant areas. CPT will continue to complete training for all employees. Subsequent EICC education will be mandatory for all new employees of CPT. Currently; CPT did not witness any corruption cases within the company, and will work to protect the company’s integrity in the future.

Audit CommitteeCPT has put in place an effective accounting system and

internal controls system in accordance with the “Regulations Governing Establishment of Internal Control Systems by Public Companies” to carry out fiduciary and ethical management. Internal auditors perform periodic audits on the status of compliance with the aforementioned systems.

The Internal Audit Dept. is set up under and reports directly to the Board of Directors. It is responsible for formulating the annual audit plan for adoption by the Board, through which the annual audit plan is submitted to the Competent Authority. In addition to presenting written audit reports to the Chairman for review, such reports shall also be delivered to independent directors and supervisors for their perusal within the valid legal timeframe. Representative(s) of the Internal Audit Dept. shall attend board meetings regularly to report the company’s audit affairs. Any material event or deficiency shall be reported immediately to directors and supervisors for timely and effective control of risks.

The Internal Audit Dept. filed 43 reports in 2011, in which a total of 28 matters were identified for follow-up. The responsible departments were required to take the appropriate corrective actions.

Disclosure of Financial Information and Communication with Investors

CPT has established a spokesperson system and appointed designated staff of the stock administration and investors department to ensure that public announcements are made in the most appropriate fashion and through the most appropriate channels. Prior to the 10th day of each month, the company announces our operating results for the previous month, which include sales figures. In addition, CPT hosts periodic online investor conferences to report the company’s operating status and future prospects, and to offer investors an opportunity to make inquires in the “Q&A” session. Contents of investor conferences may be downloaded and accessed from or re-played on the company’s website for the convenience of those who have not attended.

CPT also discloses the company’s business, financial and other material information on the Market Observation Post System. The company has appointed designated personnel to compile and communicate comments intended for the company’s supervisors received from our employees or shareholders to the supervisors.


Creation of Green Value ChainsThe five primary functional subcommittees of CPT’s

Green Management Committee promote green issues among all departments according to their functions. Employees are encouraged to engage in green action in everyday life and create comfortable and happy work atmospheres so that employees can enjoy and healthy and balanced life as they develop environmentally friendly green products to reduce environmental impacts and also transmit this green low carbon trend to upstream and downstream suppliers, clients, communities close to business locations, and the family members of employees. By establishing green principles internally and expanding it externally into environmentally friendly actions, stakeholders can understand CPT’s management and diligence of its corporate social responsibilities.

Green Management Committee

CPT established the Green Management Committee in April 2010, with the company’s President appointed as the committee’s chairperson. In line with our prospect of “Green Life & Green World,” five functional committees were set up under the Green Management Committee namely, the Environmental Safety & Health Committee, Green Innovation Committee, Green Product Committee, Green Process Committee and Green Cooperation Committee.

Initiatives for the Green Management Committee and Sub Committees for 2011

Organization Structure of the Green Management Committee

Green Innovation Committee Green Product Committee

Environmental Safety & Health CommitteeConsultant

Green Management CommitteeChairperson- President

Sub Committee Initiatives CPT’s efforts

Green Process Committee

Power conservationWater conservationReduction in liquid chemicalsReduce packagingEstablishment of energy management systemFluorocarbon emission reduction

P.22,25P.22,P.25~28, P.37, P.43P.22, P.31, P.39P.22, P.38P.25P.23~24, P.33

Green Product Committee

Green designEnergy-efficient models

P.37P.38

Green Innovation Committee

Green innovationCarbon and water footprint certification for 6.9 inch vehicular productsPromotion of green supply chains

P.37P.37, P.43P.23, P.42

Green Environmental

Safety & Health

Committee

Energy efficiency and low carbon action certificate from the Environmental Protection AdministrationRequest for supply chains to promote CSR

P.22P.43

Green Cooperation Committee

Educational trainingGreen workplaceCommunity careSocial charityGreen activities

P.58 P.42, P.57, P.64P.53~54, P.62, P.66P.62 P.43, P.64The Green Management Committee holds a meeting each quarter to

promote various green activities.

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Green Process Committee Green Cooperation Committee

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Stakeholder Engagement

To understand the true needs to stakeholders, CPT believes that communication and exchange are among the best methods. We are established various communication channels with investors, clients, suppliers, employees, communities, and government agencies. In the future, CPT will continue to enhance communication channels to satisfy concerns and needs from stakeholder relationships.

Identification of Key IssuesCPT takes keen interests in issues concerning our

stakeholders. The Green Management Committee undertakes analysis on key issues according to the following steps:

Edit ing members of each CSR units convened meetings with the company’s stakeholders in March 2012. Upon evaluation, the members decided to further engage stakeholders in dialogues by conducting surveys and interviews. CPT issued the questionnaire to NGOs, investors, suppliers, contractors, community residents, clients, government agencies and employees in Taiwan and China.The survey concluded on April, 2012 and we have received 143 responses.

Based on the results of the survey, 21 editing members from respective CSR units voted the top 10 issues ranked in order of priority are as follows:

Stakeholder’s VoiceCPT seeks to obtain valuable comments f rom

stakeholders by conducting surveys. These comments are addressed in the relevant chapters of this year’s CSR Report, which are the new features of the report this year. (Please refer to Pages 27, 36, 42, 43, 51, 52, 54~57 for details)

Stakeholders’ Needs and Communication Channels

Stakeholders Frequency of Communication

Issues of Concern CPT’s efforts

Investor

Client

Supplier

Employee

Community

Government Agencies

● Quarterly Investor Conference

● Annual General Shareholders’ Meeting

● Customer Service System

●Irregular visits

●Supplier Conference●Special Audits

●Employee Mailbox●Regular Meetings●Forum

●Community Events●Charitable Events

●Special Audits●Symposium● Participation in activities

● Profit-making● Risk Management

● Employees’ Rights(SA8000)● Electronic Industry

Code of Conduct (EICC)

● Green Products (RoHS, WEEE, EuP, REACH)

● Remuneration ● Welfare● Workplace Environment

● Environmental Impact● Social Contribution

● legal compliance● Social Impact● Environmental Impact

P.15

P.36

P.42

P.51

P.66

P.18

Priority Sequence Issue Explanation

1 financial performance Information such as Revenue, expenditures, and profits

2 Occupational health and safety

Occupational safety and management, frequency of lost time injuries, frequency of occupational illnesses, number of deaths, etc.

2 Corporate governance

Formation and operation of the Board of Directors, audits, shares held by Directors and Supervisors, etc.

4 Customer relationship management

Client satisfaction levels, problem resolution procedures, quality management

4 green products design Green products and environmental designs

6 Energy and carbon management

Explanation of the policies, methods, and future reduction targets for energy efficiency and carbon reduction

7 Stakeholder communication

Methods, procedures, and results of communication with all stakeholders

7 Innovation management

Innovations aimed at products or services, covering economic, environmental, and social aspects

9 Environmental policy / management system

Environmental protection policies, orientations, quantified information, audit verification, etc.

10 Personnel recruitment and retention

Employee evaluation, salaries and bonus systems, etc.

Step 1: Identification of

Issues

CPT gathers and compiles the list of issues concerning our stakeholder by engaging in dialogues with shareholders. We re-visit and discuss stakeholders’ feedbacks regarding our business operation processes.

Step 2: Ranking

Issues in Order of Priority

We rank each issue by order of importance according to its “level of impact on the company” and “level of external concern.” “Level of impact on the company” refers to the likely impacts of a specific issue on CPT’s operation, while “level of external concern” refers to the likely impacts of a specific issue on CPT’s image and business.

Step 3: Results of Analysis and

Examination

Issues falling within the top right-hand corner of the key issue matrix require priority action and are addressed in this year’s CSR Report.

Step 4: Continuous

Improvement

CPT attempts to understand the public’s degree of satisfaction with our information disclosure and develop, execute, and evaluate the respective action plans to carry out self-improvement continuously.


Risk Management

CPT assigns responsibilities to each respective department and established the relevant risk control mechanisms to reduce the amount of potential loss arising from the various risks such as environmental and health hazards caused by our production plants, crisis events, contagious diseases, the company’s financial status, the government’s regulatory policies and climate change.

Risks of Climate ChangeSince joining the Carbon Disclosure Project (CDP) survey

in 2007, CPT had established greenhouse gas reduction targets and plans. In 2010 and 2011, clients were actively invited to participate in the Supply Chain Program survey to provide feedback on issues such as the effects of climate change on supply chain management and product life cycles. On the issue of climate change risks, CPT will continue to focus on climate change evaluations, actively fulfill objectives of environmental improvements, enforce carbon risk management, and capitalize on emerging green commercial opportunities. We also hope to work with upstream suppliers to establish comprehensive green supply chain systems to do our part to mitigate the impacts of climate change.

Risks Confronting Production PlantsCPT continuously adopts the various risk management

measures to avoid potential hazards from resulting in the company’s direct financial loss and loss associated with disruption to business. Our measures include risk avoidance, loss prevention, loss reduction, risk segregation and transfer of control-type risks.

In 2010, CPT introduced the “Fire Losses and Personnel Safety Evaluation and Response Plan” developed by Safety and Health Technology Center. Through Performance Based Design assisted by computer technologies, simulations of fire incidents of the particle-free room were completed in 2011. Through quantified risk assessment results, plant areas have placed fire prevention equipments that are compatible with legal requirements to effectively lower the risk of uncontrollable fire incidents. CPT’s Taiwanese plants are all located in Taoyuan County, and each plant contains comprehensive emergency fire response equipments, which are combined with existing joint defense mechanisms within the plant areas to minimize the impacts of disaster incidents.

Financial RisksIn addition to bank loans, corporate bonds payable, cash

and bank deposits, CPT also engages in derivative trading including interest rate swaps, forward exchange contracts and foreign exchange options. The related management policies are summarized as follows:

1. Cash flow risks: CPT entered into interest rate swap agreements to hedge against cash flow risks arising from certain long-term liabilities.

2. Market risks: CPT seeks to reduce our exposure to foreign exchange risks by offsetting foreign exchange assets and liabilities positions and engaging in forward exchange transactions.

3. Credit risks: Our cash has been deposited at creditable local and foreign financial institutions. CPT deals with several different financial institutions to reduce risks. At time same, we conduct periodic evaluation of the collect ability of accounts receivable to make appropriate provision for doubtful accounts.

4. Liquidity risks: CPT currently has a higher balance of current liabilities than current assets, that is, we have a negative net asset position. We are dependent on future cash flows from operating activities to fund this deficit. CPT monitors our cash positions at all times, makes appropriate fund raising plans and may, when required, factor our accounts receivable to obtain the cash required to perform the contracts.

5. Hedging strategies: CPT may be exposed to cash flow risks arising from loans charge floating-rate interest due to interest rate fluctuations. Upon evaluation, CPT considered that these risks may be substantial and has thus entered into interest rate swap agreements to hedge against these risks.

In 2011, training classes for company spokespeople during disaster incidents were held in the Taoyuan plant to complete relevant training for high level corporate managers. Thus, when disasters occur, response procedures can be properly and promptly explained to external observers in order to accurately control risks during disasters.

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Deployment of Intellectual PropertyCPT has high respect for intellectual property rights. We

have obtained over 2,325 patents during the period from when the FTF business group was first established in 1997 up to December 2011. During this period, we have submitted over 1,990 patent applications for registration.

According to the “Top 100 Patent Applicants-Domestic Legal Entity” published by the Intellectual Property Office (TIPO), Ministry of Economic Affairs, CPT has climbed the ranking chart steadily from being the “Top 61” in 2001 to “Top 15” in 2011.

To enhance multifaceted deployments for patents, CPT and Intellectual Ventures (IV) signed a multifaceted intellectual property agreement on July 25, 2011, making CPT one of the clients for the IP for Defense project. This agreement enables CPT to use over 35,000 patents under IV and also work with IV to develop more patents. When facing patent lawsuits, CPT can use various patents from IV’s patent combinations as proof of its defense, which can help lower subsequent negotiation risks, acquire more favorable authorization conditions, enhance market positions, and increase corporate competitiveness.

Fair CompetitionSince 2006, CPT and several affi l iated overseas

corporations were investigated by law enforcements of multiple countries as part of litigations against TFT-LCD manufacturers for price fixing. CPT had admitted to such claims and paid the required fines. The Fair Trade Commission of Taiwan also ordered CPT to provide relevant information in 2008, which CPT has obliged as legally required. In terms of civil compensation, CPT is doing everything it can to resolve the lawsuit with consumers and governments of all countries involved. In terms of the antitrust case of CRT products, CPT had proactively cooperated with the governments of all countries involved, and therefore was not fined. CPT had always had a tradition of legal compliance, and continues its tradition of working with all countries involved with utmost honesty and integrity over resolving relevant matters. CPT understands that complying with competition legislation is a very crucial part of commercial activities. CPT will continue to strictly observe relevant legislations. Internally, CPT will continue implementing legal compliance education. Externally, CPT will cooperate with fair trade policies of all countries involved in hopes of maintaining a positive corporate image.

Respect for Intellectual Property Rights and

Fair Competition

CPT’s core values are “propriety, honesty, diligence, and frugality.” As such, CPT is highly emphatic on legal compliance. The Compliance Office is established to help employees clarify legal issues. CPT upholds exemplary corporate ethics as it continues to work with governments, citizens, stakeholders, and shareholders to satisfy different expectations and requirements from all parties involved.

Year

Intellectual Property Rights Patents C

umulative C

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1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

2500

2000

1500

1000

500

0

Certifications Awarded Certifications under Application

Reducing Energy and Resources Consumption, Develop Environmentally Friendly ProductsCPT’s green issue promotion platform – the Green Management Committee – is grounded on the spirit of “Green Life, Green World” as it introduces green orientations into the company’s operations. In 2010, CPT proposed the low carbon corporate action plan (henceforth abbreviated as Green Actions) to act as the company’s carbon reduction implementation targets. In 2011, the targets of this plan was reached 23% of carbon reduction , successfully introducing environmental principles into CPT’s business strategies, and turning them into action. Environmental effects, such as greenhouse gases, water resources, and energy use are listed as tracking evaluation criteria to assist stakeholders with simultaneously engaging in green actions. In the future, CPT will actively become a green sustainable development base to build on global trends, capitalize on the emergence of green commercial opportunities, and become a major player in the green economy.


Project 335Since 2010, CPT had been running Project 335 in terms of the manufacturing

procedures in its Taiwanese plants. Using 2008 as the base year, CPT’s voluntary 5-year plan, ending in 2014, calls for: 30% energy reduction in products, 30% packaging weight reduction per unit area, and 25% water reduction per unit area of production.

Achievement of Targets Ahead of ScheduleCPT’s 335 targets in 2010 were: 5% energy conservation

for products, 5% packaging weight reduction per unit area, and 5% water reduction per unit area during the production process. Because energy conservation results in 2010 exceeded expectations, slight adjustments were made in 2011 resulting in: 30% energy conservation for products, 10% packaging weight reduction per unit area, and 10% water reduction per unit area during the production process.

In 2012, the packaging weight reduction targets per unit area assigned by the 335 project are as follows: 16% for the Medium to Small Size Department, 25% for the Large Size Department, and 15% for water reduction per unit area of production. We hope to continue promoting resource efficiency and achieve new records.

Sharing Energy Efficiency ExperienceIn 2011, CPT was once again distinguished by the

Environmental Protection Administration as an outstanding unit in the corporate group of the northern region during the “Energy Conservation and Carbon Reduction Action Awards.”

CPT’s results in energy efficiency and carbon reduction are deeply appreciated by the Environmental Protection Administration. In 2011, a total of 5 application seminars were held for the “Energy Conservation and Carbon Reduction Action Awards” event. One such seminar featured CPT’s energy efficiency and carbon reduction experience to allow prospective enterprises who want to join the event to learn and observe from.

To build on the Environmental Protection Administration’ green lifestyle exhibition, the “Low Carbon Expert Conference” of iECO was held in Pavilion 1 of the Taipei World Trade Center. CPT was invited to share its energy efficiency and carbon reduction methods and experience on the topic of “green corporations caring for Earth,” and inspired lively discussion from the audience. Through this event and many green units that care for Earth and Taiwan, corporations and experts received valuable experience in their discussions. We also hope to pass on our experience to more friends and establish our own low carbon lifestyle as we observe the beauty of a well-protected environment. By applying green products and environmental knowledge, we also inspire more energy efficient, low carbon, ecological, and environmental experts.

Comparison of Targets and Actual Achievements in 2011

Item Target Actual Results

Product Energy Conservation● Medium and Small Business Department● VD Industry Department

30%50.05%36.52%

Packaging Weight Reduction per Unit Area● Medium and Small Business Department● VD Industry Department 10%

14.91%24.31%

Water Usage per Unit Area of Production 10% 13.2%

Winning the “Energy Conservation and Carbon Reduction Action Awards” Once Again

In 2010, CPT responded worked with the Environmental Protection Administration to promote energy efficiency and carbon reduction activities and implementing such actions in the everyday lives of our employees. CPT’s is committed to carbon reduction for the long term. CPT continues to enforce energy efficiency and carbon reduction in every life, rally internal carbon reduction culture within the company, and further promote carbon reduction activities.From reductions in volatile organic compounds (VOCs), green packaging, waste reduction, water conservation, electricity conservation, chemical reduction, green activities, carbon and water footprint certifications, and green products, a total of 42 actions were performed. In 2011, CPT once again passed examination from the committee over its standards during the “Energy Conservation and Carbon Reduction Action Awards,” and was distinguished as an outstanding unit in the corporate group of the northern region.

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Greenhouse Gas InventoryCPT also closely observes trends in domestic and

international legislations related to energy and greenhouse gases. Every year, greenhouse gases are audited and verified. Seed personnel are trained in Taiwanese and overseas plants to undertake relevant work, which not only includes internal investigations, third parties are contracted every year to conduct external verifications and review feasible improvements with the objective of creating complete carbon audit tools.

Af ter acquir ing ver i f icat ion let ters, greenhouse management is disclosed to CPT’s stakeholders, which not only addresses issues of concern to stakeholders, but also wins recognition from government agencies, clients, and nongovernmental organizations. CPT also requests suppliers to engage in carbon investigation in order to establish complete green supply chains.

CPT’s carbon investigation includes: Taiwanese plants (Taoyuan, Longtan, and Yangmei plants) and Chinese plants (CPTF Optronics CO.,LTD, Chunghwa Picture Tubes (Wujiang) Ltd., CPT Display Technology (Shenzheng) Ltd., CPT Display Technology (Fujian) Ltd., CPTF Visual Display (Fuzhou) Ltd., CPT TPV Optical (Fujian) Co., Ltd.). Greenhouse gas audits for 2011 started in February 2012, and third party verification was acquired in April.

Low Carbon Corporate Action PlanCDP assigned CPT a score of 81 in 2011 from its

evaluations (the average score among over 1800 corporations around the world who participated in this project was 51). Participation was lacking from supply chains and stakeholders, which is an issue that CPT will strive to improve in the future.

Since 2008, CPT joined the “Carbon Disclosure Project” (CDP). Disclosure of carbon-related information includes analyses of risks and opportunities related to climate change, carbon reduction targets and execution of action plans, establishment of green supply chain platforms, green requirements, etc. Relevant management mechanisms have been established in hopes of minimizing the effects of climate change against CPT.

Carbon Management

In 2011, most of CPT’s greenhouse gas emissions consisted of perfluorinated compounds (PFCs) and externally procured electricity. Relevant carbon reduction targets have all been incorporated into major company policies and strategic objectives. All energy conservation and carbon reduction actions are being enforced and reviewed by the company’s Green Management Committee. Therefore, the carbon reduction target of 22% was achieved in 2011.

Emissions (in tons of carbon dioxide e/year)

Parameters Emission Source 2009 2010 2011

Scope1Direct emission sources include greenhouse gas sources owned or controlled by the plant (static burning sources, mobile burning sources, manufacturing emission sources, and dispersed emission sources)

439,125 690,690 427,728

Scope2 Indirect emission sources primarily include 728,288 789,608 712,777

Scope3other emissions from externally purchased electricity (transportation of raw materials, supplier production, employee travels, and waste disposal are not listed in the inspection parameters; they are characterized and not quantified)

-- -- --

Overall emissions 1,167,413 1,480,298 1,140,505

Note: the Hukou plant was sold, and therefore is not included in 2010. Data from 2011 does not include the Hukou plant, Malaysia plant, and Kampar plant in Malaysia due to those plants having been sold.

CPT’s CDP Score in 2011

Item CPT’s Score Average

Governance and Strategy 93 74

Risks 88 42

Opportunities 90 36

Emission Report (Data) 77 69

Emission Management 82 61

Participation from Stakeholders 50 33


Introduce Low GHG MaterialCPT actively discloses its greenhouse gas management

information to external observers, and hope to gather relevant opinions for continuous improvements. CPT is a member of the Taiwan TFT LCD Association (TTLA), which holds regular annual review meetings for greenhouse gas emissions. Other than disclosing our own emissions over the national greenhouse gas registration platforms, we also use the association to explain our carbon management and reduction methods to domestic government agencies and international WLICC members (including opto-electronic enterprises from Japan and South Korea). We continue to absorb new knowledge and review our performance, and we also share our reduction experience with all enterprises in the industry as part of our collective effort to address climate change.

TTLA signed its first cooperative memorandum for voluntary reductions with the Environmental Protection Administration in 2004. In 2007, it signed the “Voluntary Greenhouse Gas Reduction Agreement” with the Ministry of Economic Affairs. CPT will also work with TTLA to provide regular emission information of fluorinated compounds, and engage in reductions of fluorinated compounds. Our management procedures include:

1. Reconstruction of the chemical vapor deposition (CVD) process in the Taoyuan and Longtan plants have been completed, which results in a 38% emission reduction of fluorinated compounds from 2010 levels, equal to approximately 170,000 tons of carbon dioxide.

2. Due to adding new manufacturing processes required for touch sensor panels (TSP) in 2010, the Longtan plant added a dry etching manufacturing machine. This machine uses fluorinated gases. In order to achieve our reduction targets, we have procured end gas incineration equipments, which can achieve an emission elimination rate of up to 90%.

3. Emissions produced by manufacturing processes that use fluorocarbons (FCs), is a major source of greenhouse gas emission during the production process of thin membrane liquid crystal display devices. Currently, processes for end gases from machines include increasing production usage rate and adding local scrubbers (LS). In 2011, CPT’s emission of fluorocarbons accounted for 24% of the company’s total emissions. Reductions of CPT’s fluorocarbon emissions between 2002 and 2011 are estimated to be equal to approximately 24 million tons of CO2 emissions.

Note: environmental greenhouse gas efficiency = annual operational revenues / annual total greenhouse gas emissions.

2M

1.5M

1M

0.5M

0

62

60

58

56

542009 2010 2011

Annual Greenhouse Gas Emission Trend

1,038,374.79

1,384,530.82

1,140,505.40

57.82

60.17

55.13

Greenhouse gas emission (CO2 e / year)Environmental greenhouse gas efficiency

Electricity Consumption Trends per Unit Area

Note: electricity usage per unit area = total electricity usage in all Taiwanese plants / total invested area. Due to the global financial crisis in 2009, production usage rates reduced, causing increases in electricity usage per unit area.

Electricity usage per unit area (kW

h/m2)

Electricity usage (G

Wh)

1,100

1,050

1,000

950

900

850

800

250.00

200.00

150.00

100.00

50.00

2009 2010 2011

Electricity ConsumptionElectricity Consumption per Unit Area

2M

1.5M

1M

0.5M

0

100

80

60

40

20

02009 2010 2011

Annual Electricity Usage Trend

1,058,672.81

1,239,636.63

1,177,703.22

56.7167.21

53.39

Note: environmental electricity efficiency – annual operational revenues / annual total electricity usage.

Annual electricity usage (MWH)Environmental electricity efficiency

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Initial Phase Project for the Opto-Electronics IndustryIn 2011, the Environmental Protection Administration

officially announced the initial phase emission standards for the opto-eelctronics industry. CPT provides its annual emission audits, emission reduction information, and also completed the online survey through the national greenhouse gas registration platform through TTLA to act as references for the initial phase emission intensity legislation for the opto-electronics industry, as enforced by the Environmental Protection Administration, as well as improvements to uploading platforms. After the initial phase project was officially announced, audits commenced for qualifying plant areas. Relevant information is also posted on the national greenhouse gas registration platform. CPT works diligently with the Environmental Protection Agency to enforce relevant projects, and achieved considerable results in greenhouse gas emission reductions every year.

Establishment of Energy Management SystemsCPT is actively promoting resource management. In

2011, CPT participated in the “industrial energy conservation, carbon reduction, and water reduction project of Taoyuan County, receiving the only industrial assistance plan for the “energy management system” from the Economic Development Bureau of Taoyuan County. In September, the Taoyuan plant officially established the energy management system implementation team to create the energy management system according to international standard ISO 50001. International third party verification is expected to be completed in 2012. By introducing such system standards, the plant has created energy investigations and energy base lines, while assigning energy performance indicators and targets. In 2011, 35 energy conservation and carbon reduction proposals were implemented. In the future, 1.52MWH is expected to be conserved each year.

In 2011, all of CPT’s plants continue to engage in improvements over energy conservation, such as increasing energy conservation over the load bearing rates of ice water machines, energy conservation to the air conditioning of particle-free rooms, increasing the dew point temperature of compressed dry air (CDA) engineering, appropriate electricity usage for lighting areas, etc. Electricity usage across all of Taiwan’s plants is gradually reducing annually, resulting in approximately 6,926,604 watts of electricity conserved. Area of base board production is 1.06% lower than in 2010, but electricity usage decreased by 3.04%, while electricity usage per unit area is 2% lower than in 2010.

Electricity Conservation Results and Summary for All Plants in 2011

Plant Electricity Conservation Measure KWH/Year

Taoyuan Plant

Energy conservation of the load bearing rate of ice water machines 1,105,512

Increasing dew point termperature for CDA engineering 326,888

Energy conservat ion at tachment to polarized lens boards 65,700

Energy conservation of water cooling tower fans 135,891

Lungtan Plant

Intermittent operation of RO operations 170,016

Energy conservation for the operation of the alkaline release system 255,600

Review of energy conservation controls for general air conditioning 76,800

Lighting for compressed air mechanical rooms 43,860

Yangmei Plant

Speed reduction of the fan filter unit (FFU) network 609,325

Improvement I of energy conservation for lighting 167,849

Installation of adaptors to office air conditioning machines for energy conservation 118,637

Energy conservation for lighting in chemical warehouses 109,763

Improvement II of energy conservation for lighting 797,913

Wujiang Plant

Temperature adjustment of SR pure water supply 87,476

Increasing dew point termperature for CDA engineering 794,836

Fujian Plant

Electrical re-engineering of l iquefied petroleum gas (LPG) in the cafeteria 1,300,000

Re-engineering of hot mercury 68,000

Improvement of air conditioning frequency 325,000

Shenzheng Plant

Improvement of air conditioning frequency for plant areas 244,400

Energy effiency installations for lighting in plant areas 311,700

CPTF Optronics Co., Ltd.

Air conditioning machines set to dew point temperatures in particle free rooms 1,080,000

Reduction of air conditioning operation frequency in CR 360,000

Air conditioning temperature increase and improvements of timing adjustment 108,000

Usage of connected ice water for the BC ice processing machine 312,000

CPT TPV Optical (Fujian) Co., Ltd.

Pressure improvement of particle free room 51,000

Operational management of summer air conditioning 400,000

On / Off inspection of machines during shutdown days 50,000

Pressure reduction and improvement of ice water 89,000


Water Resources

Management

Droughts are becoming increasingly common in the world due to the effects of climate change. However, the TFT-LCD manufacturing industry has high demands for water. Therefore, CPT is engaged in long term commitments to reduce water usage and recycle and reuse water resources during manufacturing processes in order to reduce the risks of water resource shortages.

Water UsageIn 2011, combined water usage for all CPT plants in the

world was 13,544,188 tons, 11,730,571 tons (86.61% of total usage) of which came from Taiwanese plants. China plants used a total of 1,813,617 tons of water (13.39% of total usage), most of which was water for daily needs. Combined wastewater volumes from all CPT plants in the world were 11,551,601 tons, 10,350,802 tons of which came from Taiwanese plants. China plants used a total of 1,200,799 tons of wastewater.

Recovery rate of recycled and reused water is 48.38% for Taiwanese plants, meaning that approximately 5,675,825 tons of water are typically recycled and reused for the heat exchanger of the water cooling tower and alternative manufacturing processes. Recovery rate of recycled and reused water for Chinese plants is 20.37%, meaning that approximately 369,356 tons of water are typically recycled and reused for alternative manufacturing processes. Thus CPT reduces exhaustion of water resources.

CPT’s Taiwanese and Chinese plants use municipal water. The Taoyuan, Longtan, and Yangmei plants in Taiwan use underground water in addition to municipal water as a secondary source of water in order to provide backup water when municipal water is insufficient. Amounts of water extracted are in compliance with government-approved amounts and regularly reported to regulatory agencies for reference. Water sources for plant areas were not affected due to extracting underground water.

Water Conservation ResultsIn order to effective reduce exhaustion of water

resources, CPT not only increases recycling of water resources, but also made improvements at the source in 2011 to continue conserving water during manufacturing processes. By re-engineering manufacturing machines to conserve water, clean water can return to the manufacturing end and be used repeatedly. The water conservation proposals for the manufacturing processes of Taiwanese plants accounted for 80% of all water conservation proposals in 2011. At the same time, CPT informed its colleagues to cherish water in daily life, such as using recycled water for toilers, water efficient water taps for washrooms, and using recycled rain water to clean the roads in plant areas.

In 2011, CPT continued all the water and electricity conservat ion measures of the previous year. Water conservation during manufacturing processes primarily focused on reduction of water usage for equipments and recycling and reusing water that was released during manufacturing processes. Compared to a 1.75% reduction in base board production from Taiwanese plants in 2010, water usage for manufacturing processes was reduced by 3.3%. Water usage per unit area during the production process was 1.58% less than in 2010.

Note: environmental water efficiency = annual operational revenues / annual total water usage.

Annual Total Water Usage Trend

2M

1.5M

1M

0.5M

0

6.00

5.50

5.00

4.50

4.002009 2010 2011

10,877,532.2

15,681,98013,544,188

5.52

5.31

4.64

Note: water usage per unit area of production = total production water usage for Taiwanese plants / total invested area

water usage per unit area (ton/m

2)

Total water usage during production

(megatons)

14

12

10

8

6

4

2

0

1.80

1.75

1.70

1.65

1.60

1.55

1.50

1.45

1.40

1.352009 2010 2011

Trend of Water Usage per Unit Area during Manufacturing Processes

Total Water UsageEnvironmental Effects of Water Usage

Total water usage (M3)Environmental water efficiency

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Wastewater DisposalIn 2011, CPT improved the manufacturing processes

to successfully reduce water usage during manufacturing processes, as well as recycle and reuse water. The non-organic wastewater is processed by the processing system and supplied back to the water cooling tower and recirculating cooling water (RCW). Organic wastewater is processed by MBR (biological + membrane) processes and then filtered, recycled, and reused through reverse osmosis to effectively reduce wastewater outflow and reduce the environmental impacts of CPT’s water usage and wastewater.

In 2011, CPT continued to improve and upgrade its wastewater treatment system, such as adding the “organic wastewater membrane replacement” in the wastewater processing facility of CPT’s Longtan plant, while a “non-organic system recycling and processing” facility was added to the Yangmei plant. CPT’s Taiwanese plants made considerable improvements and investments in wastewater treatment facilities, devoting approximately $NT 25 million. Also, to ensure that wastewater outflow fulfills legal requirements, $NT 45.81 million was invested in 2011 for wastewater treatment chemicals.

To ensure that the quality of processed water is compatible with standards of recycling and reuse, CPT’s Longtan plant spent $NT 8 mill ion in 2011 to replace membranes, and is expected to invest $NT 15 million annually for the next 3 years to replace all membranes.

To increase the processing capabilities of non-organic wastewater and improve the quality of wastewater outflow, the Yangmei plant used chemical mixtures, rapid precipitation, and particle filtering in 2011 to process non-organic water released during manufacturing processes to ensure that the quality of released water fulfills environmental legislations.

Overall Wastewater Volume (m3)

Year 2009 2010 2011

Taiwan 8,011,968 9,862,234 10,350,802

China 1,075,857 1,569,612 1,200,799

Total 9,087,825 11,431,846 11,551,601

Note: the Taoyuan plant also processes wastewater from 3 other companies: Lingju, Zhonghuabantu, and Chengchuang. Because they are difficult to quantify, they are all undertaken by the Taoyuan plant.

Longtan Plant Distinguished as Outstanding Unit for “Water Conservation” by the Water Resources Agency of the Ministry of Economic Affairs

CPT’s Longtan plant in Taiwan participated in the “nomination for outstanding water conservation units and individuals in 2011,” and passed evaluations from the event’s committee to win the distinction of outstanding water conservationist in the industry group. CPT was also nominated by the hosting agency as a role model facility so that CPT’s Longtan plant can share its relevant water conservation measures and experience with the industry.CPT understands that water is a precious resource. Other than increasing recycling of water resource, reducing water usage from the source had always been the objective behind CPT’s diligence. In order to reduce water usage during manufacturing processes, manufacturing machines were re-engineered to achieve the objective of water conservation and reduce the environmental impacts of water usage and wastewater from CPT’s Longtan plant. Therefore, winning the “outstanding water conservationist unit” is the greatest recognition and encouragement for CPT’s commitment to conserve energy and resources. Subsequently, CPT will continue to strive for improvements and increase the water resource reuse rate within its plant areas to achieve the “win-win” objective of environmental protection and economic development.


Reduce Water Usage in Manufacturing Processes● Implementation of Flow Adjustment of the Etching

Machine of the Array Phase Manufacturing Mechanical Platform (AWA) which conserves 11,706 tons of water consumption per year.

● Implementation of Pure Water Flow Adjustment of the Pre-Membrane Washing Machine of the Array Phase Manufacturing Mechanical Platform, resulting in an annual reduction of water consumption by 7,949 tons.

● Implementation of Flow Adjustment of the Base Board Washing Process of the Array Phase Manufacturing Mechanical Platform. Taoyuan plant engaged in water conservation tests for its machines that used greater amounts of water. Water flow for the original mechanical washing platform was originally 45±5 L/min, which is adjusted to 35±5 (L/min), resulting in an annual reduction of water consumption by 5,299 tons.

● Water Conservation Plan for Pre-CELL and Post-CELL Washing Machine, resulting in an annual reduction of water consumption by 9,460 tons.

● Dampening Water Adjustment of the PHASE2 CLEANER Cleaner gear, resulting in an annual reduction of water consumption by 11,391 tons.

Increase Water Resource Recycling● Replacing Tap water in Washrooms with Non-Organic

Recycled Water.Recirculating cooling water (RCW) is now used to conserve the quantity of Tap water used.

● Pure Water Usage Cost Down of Display Machines, conserving 110,886 tons of water annually.

● Water Outflow from Phase 1 ITO Line Pre-Cleaner Transferred to be Used by the Post Cleaner, conserving 19,436 tons of water annually.

● Improvements of Recycl ing and Reuse of SR Wastewater. Wujiang plant uses wastewater from the SR manufacturing process to be used by the air compressor and boiler, which reduces municipal water usage, and enables conservation of municipal water by 12,200 M3/year, and reduces water costs by $RMB 37,800/year.

● Improvements of Recycling and Reuse of Common Industrial Wastewater. Wujiang plant filters common industrial wastewater into medium water, which is used to replace industrial municipal water used in manufacturing processesduring production. Water consumption is conserved by 36,000 tons/year.

Contractor: De-Sheng Zhan, Business Department Manager, Chemyol Co., Ltd.

Air conditioning is typically the most energy-intensive application of high-tech industries. Therefore, Chemyol is working with CPT to start from water resource conservation and energy conservation. Also, CPT provides assistance by implementing the Safe Family program to increase internal industrial safety knowledge within the company, as well as enhancing risk assessments. Also, by referencing CPT’s work environment, we have improved many negligent aspects within our own company, which benefited us greatly.

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Outline of Material Flow

Primary Raw Materials(See Note 2)

Other Released Materials(see Note 6)

Manufacturing center

Water Resource Consumption■Water Usage■Plant-Wide Water Recycling Rate

■Self-Generated Electricity■Externally Purchased Electricity

2011 2009 2010

1286.17

1707.98

1354.03

45.83%

41.67%

44.63%

Wastewater Release Volume(in 10,000 tons)

Recycling and Reuse of Liquid Waste(tons)(see Note 4)

0.68

Electricity Consumption (MWh)

Greenhouse Gas Emission Volume

Disposed Waste(in 10,000 tons)(see Note 5)

2011 2009 2010

1049.74

1172.95

1205.05

1334.61

1083.63

1162.03

Liquid Petroleum Gas (in 10,000 m3)

2011 2009 2010

0.63

367.56

120.48

Reuse of Glass Waste( tons)(see Note 3)

2011

2011

2009

2009

2010

2010

1006.06

1.07

1155.16

1.26

1202.77

1.43

2011

2011

2009

2009

2010

2010

115.03

165.67

148.03

222.95

114.05

3.96

2011 2009 2010

198275

968.71

Heavy Oil(in 10,000 m3)Natural Gas(in 10,000 m3)

2011 2009 2010

3.93

27.8

1.92

2011 2009 2010

1268.371762.67

565.06

123.21129.56 78.40

Glass Base Board Investment Area 7,660,900 m2

Light Resistors 3,600 tons

Etching Fluid 4,603,400 tons

Developer Fluid 13,881,400 tons

Liquid Crystal 10.25 tons

Nitrogen 141,100 tons

Argon 21 tons

Hydrogen 78 tons

All Fluoride Gases 274 tons

Floating Particles (SS) 100.14tons

Chemical Oxygen Demand (COD) 542.82tons

Biological Oxygen Demand 542.82tons

Sludge Volume 9,786.3tons

Dispersing Organic Substances 123.99tons

Sulfuric Oxidized Substances 159.74tons

Nitrogenous Oxidized Substances 180.1tons

Note 1: water recycling rate for the whole plant: includes water recycling volumes for the plant itself and manufacturing processes

Note 2: raw materials refer to volumes used for invested production;glass base board investment area: includes production area invested for TFT and CF;all fluoride gases: includes CF4, SF6, and NF3

Note 3: volume of reused glass waste: includes bare glass, side-cut glass, and glass without liquid crystalNote 4: recycling and reuse of liquid waste: includes propanone, membrane removal fluid, light resistor

dilution fluid, hydrofluoric acid, chromium etching fluid, aluminum etching fluid, and wasted oilNote 5: overall waste volume: includes general (includes recycled resources) waste and hazardous

waste;final disposed waste volume: total volume of waste with no recycling or reuse applicationsNote 6: calculations for SS, COD, and BOD are based on periodical test report data multiplied by

wastewater outflow volumes;calculations for NOx and SOx are based on periodical test report data multiplied by waste gas emission volumes

■ Total Volume of Waste Material

■ Final Disposal Volune of Waste Material

1.07

1.26

Product Volume(million units)

■TFT-LCD Display Production ■TFT-LCD Display Sales

2011 2009 2010

17338

42108

51909

16719

3757148000R&D

Development of Sustainable Environmental

Products

Purchase Production/Assembly

ProductTransportation

SalesService

Clients

INPUT

OUTPUT

(in 10,000 tons) (see Note 1)

Green Procurement and

Fair Trade

Energy Efficient Production

and Pollution Reduction

Environmental Products

(tons of CO2 equivalents)


Environmental Risk Assessment and Communication

CPT is highly concerned about the impacts of plant operation on the environment. Not only are comprehensive environmental management systems in place, environmental evaluation and risk assessment management procedures are also established. As well Taiwanese plants use online management systems to perform comprehensive risk assessments and appropriate designations for risk level classifications.

Chemical Substances ManagementIn 2011, Taiwanese plants continued working with the

Council of Labor Affairs to implement chemical management initiatives and establish and report lists of chemicals for each plant to set the foundation for source management. Austere investigating measures are introduced for new chemicals, while chemical equipments and change of management programs are introduced. Electronic online management systems are established while procurement and testing of chemicals are also regulated.

Chemicals need to undergo comprehensive r isk assessment procedures before they can be introduced and be appropriately designated with risk level classifications. Only those chemicals that fulfill plant regulations can be tested and used.

CPT began developing green chemicals in 2004 due to client requests. Control and assessment principles for chemical materials used in manufacturing processes are established in the spirit of the European Union’s chemical policy. A chemical management system tailored for CPT was established. CPT is also promoting and enforcing source management for chemical materials. All chemicals need to be investigated to confirm that they have no prohibited substances, and also need to undergo cautious evaluations before they are eligible for procurement procedures.

In 2011, there were no chemical spills, labor safety disasters, or plant-wide work stoppage that affected the surrounding environment of the plant or caused major personnel or asset losses.

In response to Effluent Standards LegislationIn order to enhance high-tech wastewater management,

the Executive Yuan’s Environmental Protection Agency promulgated amendments to the “Effluent Standards” on December 15, 2010, which adds requirement parameters for the optoelectronics material and parts manufacturing industries and science and industrial parks, including limits on allowable amounts of gallium, indium, molybdenum, overall toxic organic materials, acute biological toxins, etc. The limits will be fully enforced after an adaption period ends in January 2012.

The Taoyuan and Yangmei plants have been able to comply with current legal requirements over tests for gallium, indium, molybdenum, and total toxic organics, as promulgated by the Environmental Protection Administration.

To account for future legislative amendments, Taoyuan

plant’s independently measured ammonia levels can now pass first phase control standards, but not second phase control standards. For the second phase control standards, the Taoyuan plant is planning for assessments and installations of upgrades to equipment functions so as to meet second phase control standards before it becomes effective. The independently measured ammonia levels of Yangmei plant already meets the second phase control limits announced by the Environmental Protection Administration.

The Longtan plant started executing the demonstration plan (as a demonstration contractor) in cooperation with the Environmental Protection Administration, which called for adding new inspection criteria, and is able to fulfill the Environmental Protection Administration’s current and upcoming stipulated legal requirements over testing for gallium, indium, molybdenum, total toxic organics, acute toxic units, and ammonia criteria.

Control Criteria

Opto-Electronic Material and Parts

Manufacturing Industry

Science and Industrial Parks of “All Industrial Areas Except

Petrochemical Areas”

Total Toxic Organics 1.37 (mg/L) 1.37 (mg/L)

Indium 0.1 (mg/L) 0.1 (mg/L)

Gallium 0.1 (mg/L) 0.1 (mg/L)

Molybdenum 0.6 (mg/L) 0.6 (mg/L)

Acute Toxic Units 1.43 1.43

Category

Note 1: Total toxic organics is based on risk management concepts, and regulates total concentration limits of 30 chemicals within wastewater.

Note 2: Acute Toxic Units refer to the inverse of Lethal Concentration 50 (abbreviated as LC50) or Effective Concentration 50 (abbreviated as EC50), and has no unit. These criteria can reflect the effects of wastewater on aquatic organisms.

High-Tech Wastewater Outflow Control Standards

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In response to Amendments to Land Pollution Legislations

Taiwan’s Environmental Protection Administration added targets of land pollution fees.

The primary impact of this amendment on CPT’s Taiwanese plants is the addition of industries that are subject to this legislation. Fees are paid according to the industries registered in the public and private waste material disposal plan. CPT’s Taiwanese plants are all part of the industries listed by the public and private waste material disposal plan in 2011, and have all paid their fees by July 1, 2011, as legally required.

Continued Commitment to the Xiaoli River Incident

CPT’s Longtan plant passed environmental impact assessments in 2001, and acquired legal permit to release wastewater in 2003. According to Hsinchu County’s designation of water source quality protection zones, the Longtan plant’s wastewater was not released directly into such zones. Also, all wastewater released fulfilled CPT’s pledge of controlled limit values when the plant was being developed.

On March 13, 2012, the Ministry of Economic Affairs announced that Xiaoli River will no longer be a source of drinking water. On March 20, 2012, the Environmental Protection Administration announced that Xiaoli River was designated as the sustaining water body for the original environmental impact report during the environmental impact assessment procedure. Now, due to the Ministry of Economic Affairs announcing that Xiaoli River is no longer a source of drinking water, CPT is abiding by the original outflow proposal by Xiaoli River as the sustaining water body, and will not incur any violations against the assessment.

CPT continues to monitor the water quality of wastewater released into Xiaoli River. The Longtan plant had been working the Hsin-Chu Irrigation Association since 2009 to conduct environmental monitoring of Xiaoli River by relying on neutral third parties to explain the current conditions of water quality, soil, bottom soil, etc. since July 2010, CPT continues to request industrial technology service groups from Taoyuan County to engage in relevant monitoring projects to ensure the quality of wastewater outflow.

2011 Environmental Expenditure Statistics

Region Items Expenditure (in $1,000)

Taiwan

Expenditures on emission equipment improvement and chemicals: all waste gases are processed according to category and characteristics at the mechanical platform ends. Currently, equipments are classified into acidic emissions, organic emissions, 106 emissions, and petrol-electrical emissions equipments.

44,670

Expenditures on wastewater release equipment improvements and chemicals: processed and categorized as common wastewater, organic wastewater, and non-organic wastewater.

61,090

Outsourcing expenditures of waste material disposal 44,530

Organic wastewater processing membrane unit replacements for the Longtan plan and CUTTING LINE wastewater system expansion and HOOK UP project for the Yangmei plant

25,050

Environmental inspection / monitoring costs: includes inspection costs for air and water pollution

4,710

Air pollution expenditures: air pollution fees reported to the Environmental Protection Administration

10,350

Land pollution expenditures: land pollution fees reported to the Environmental Protection Administration

470

Environmental certification evaluation and certification expenditures: all administrative and miscellaneous expenditures

260

Environmental fines: 6 violations occurred. 3 of them were violations on wastewater release regulations, and 3 were violations on reporting requirements.

850

ChinaExpenditures on wastewater disposal, outsourcing of waste material disposal, and environmental monitoring

5,230

Note: data for the Taiwan region is in NTD dollar Data for the China region is in RMB dollar

Although Xiaoli River is no longer a source of drinking water, we still continue to monitor the quality of wastewater outflow to ensure compliance with legal requirements.


Resource Reduction and

Reuse

CPT believes that consumption reduction can only be aided by source improvements and green production designs. Also, CPT hopes to reduce the direct environmental impacts and subsequent waste material disposal problems from mineral extraction through recycling and reusing various materials and developing environmental products in order to address trends in sustainable global developments and resource recycling and reuse.

Recycling of Liquid WasteCPT abides by the regulations and environmental

legislations from the Basel agreement. Waste materials are processed through source reduction, categorization, reuse, or resource reuse, in order of preference. If waste materials currently cannot be processed by the aforementioned methods, they are then buried or incinerated. Waste materials under appropriate management are primarily categorized as requiring disposal (general / harmful waste), recyclable, or resource waste. All waste materials are processed and recycled according to law.

Waste materials are categorized as solid and liquid waste. Liquid wastes are primarily organic solvents and etching fluid. Besides reducing liquid waste output at the front end through flow control, necessary rear end liquid waste production is processed through recycling and reusing if possible. Waste is thoroughly and categorized and processed at the source ends, and the flow liquid waste is thoroughly controlled at the mechanical platform ends. For example, Cr-T etching fluid is returned to the contractor for purification and then returned to CPT as recycled fluid for production use. In 2011, liquid waste recycling rates for CPT’s Taiwanese plants reached 84.06%. CPT hopes to work with its partnered contractors to strive for the objective of sustainable recycling.

Reuse of Solid WasteIn terms of solid wastes, sludge from the wastewater

treatment plant is the greatest issue. In the early stages, sludge was usually buried or reused. To account for the limitations of soil resources and the concept of water and soil protection, CPT’s Taiwanese plants signed recycling contracts with recycling contractors that are certified by the Environmental Protection Administration in 2009. Primary materials involved are recycled construction materials, which are now reused instead of buried. Therefore, recycling rates for waste materials from all plants have increased from 57.85% to 94.93% between 2009 and 2010 as CPT does it part for the environment.

Liquid Waste Production among Taiwanese Plants in 2011 (unit: tons)

Total Taoyuan Plant

Longtan Plant

Yangmei Plant

Total 14,969.10 2,506.20 9,375.27 3,087.63

Total Liquid Waste

Recycled12,583.62 2324.56 7,558.11 2700.95

Total Liquid Waste

Disposed2,385.48 181.64 1,817.16 386.68

Liquid Waste Recycling

Ratio84.06% 92.75% 80.62% 87.48%

Waste Material Production among Taiwanese Plants (unit: tons)

2009 2010 2011

Total 20,182.27 28,174.87 27,880.91

Wastes that Required Disposal 8,507.32 1,429.75 3,509.91

Recyclable Waste 9,805.10 25,155.14 22,536.57

Resource Waste 1,869.86 1,589.98 1,834.43

Recycle & Reuse Ratio 57.85% 94.93% 87.41%

Note: the Hukou plant was sold, and therefore is not included in 2010.

Waste Material Production among Chinese Plants (unit: tons)

2009 2010 2011

Total 1,634,465.44 2,193,809.93 11,702.89

Wastes that Required Disposal 2,033.11 4,616.82 3,263.16

Recyclable Waste 46.07 0 0.01

Resource Waste 1,632,386.26 2,189,193.11 8,439.72

Recycle & Reuse Ratio 99.88% 99.79% 72.12%

Note: general waste from CPT Visual Information (Wujian) Co., Ltd. / Shenchaun CPT Display Technology Co., Ltd. / Fujian Huaguan Opto-Electronics Co., Ltd. in the China region had been incorporated into statistics for 2011. General waste for Fujian CPT Display Technology Co,, Ltd / Zhonghua CPT Fuzhou Plant / Fuzhou CPT Visual Information Co., Ltd. are not incorporated into statistics.

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Air Pollution Prevention

CPT established its own independent power generation procedures to ensure stability in the production process. The primary sources of waste gas are from TFT/CF manufacturing and power generation processes. In order to reduce pollutant emission from manufacturing and power generation processes, manufacturing process coefficients are optimized to reduce the intensity of end gas processing equipments. Also, the capabilities of high pollution processing equipments are upgraded continuously.

Volatility Organic Substance Emission ParametersCPT’s Taoyuan, Lungtan, and Yangmei plants have all

adopted the best feasible technology and facility to control this pollutant – zeolite turbine concentrated incineration facilities. This facility uses burning temperatures of 700~800 degrees Celsius to effectively process organic pollutants, achieving disposal rates of 95% or higher. CPT also abides by government legislative requirements. Not only does CPT perform regular inspection of organic pollutant emission lines and regular emission reports, its internal disposal efficiency is always set at a minimum equivalent to legislative standards.

In 2011, certain parts of manufacturing processes were alteredin the Longtan plant. To increase the processing capabilities of organic emission systems and improve the quality specifications of emissions, CPT completed the addition of 1 zeolite concentration turbine +RRTO furnace system under the precondition of not incurring excessive environmental detriments. Zeolites are used to absorb and concentrate waste gas, and then sent to the RRTO furnace to dispose of solvent vapors in organic emissions. Clean airs produced from the aforementioned processes are then sent to the atmosphere.

Fluoride & PFCs Gas DisposalCPT’s Taoyuan and Lungtan plants’ TFT manufacturing

process involve membrane molding and dry etching procedures that use SF6 and NF3 gases for the manufacturing process. Therefore, fluoride gases that have not reacted completely would be emitted from the end gas emissions. Because SF6 and NF3 are greenhouse gases with high global warming potential (GWP), CPT uses high temperature burning to break down the gases’ molecules, augmented by particle accumulation filter bags to capture the secondary solid pollutant that result from the burning process – silicon dioxide. Lastly, the cleaning tower is used to clean out special gas molecules in the waste gas. Currently, efficiency is at 90% or above.

Disposal of Acidic and Basic GasesAcidic and basic gases are emitted during the TFT

manufacturing process in CPT’s Taoyuan and Lungtan plants and the CF manufacturing process in the Yangmei plant. After acidic or basic solutions interact adequately with water, acidic and basic ions from the emissions are dissolved in water, and the resultant cleaning water flow to the wastewater treatment plant for treatment. After removing acidic and basic ions, emissions are released into the atmosphere at pH 7~9. The plant has placed automatic solution adding systems in the cleaning tower, which enable instantaneous monitoring of pH values, residual chlorine, and electric conductivity values, in order to ensure the cleaning efficiency of the cleaning tower.

Motorized Electricity Generation ProcessIn 2011, CPT’s independent power generation facilities

in the Taoyuan and Longtan plants were all able to operate normally and provide stable supplies of electricity. Primary air pollutants include sulfuric oxidized substances and nitrogenous oxidized substances. In terms of controlling sulfuric oxidized substances, CPT employs the low-sulfur (0.5%) #6 heavy oil burning process approved by the Environmental Protection Agency, which products pollutant emissions far below legally stipulated concentrations. In terms of particle pollutants, DeNOx facilities are placed at the emission front end, which can effectively remove those pollutant types through catalyst exchange. Two tests are performed each year, as legally required,all of which fulfilled legal requirements.

CPT’s Taoyuan plant had terminated its independent power generation facilities in October 2011 as CPT accounted for the utility of independent power generation compared to procured electricity in 2011. The Longtan plant will terminate its independent power generation facility in 2012 in hopes of maximizing the utility of limited resources.

Provide High Quality Green Products, Winning Customer RecognitionCPT had been actively engaged in producing small and medium size smart products, and never paused its investment activities in green products. CPT is committed to minimizing the climate change effects caused by greenhouse gases. Energy efficiency utility is considered during initial product design, while carbon emissions produced from the life cycles of products are also minimized. As well, reduction of resource consumption during product packaging and transportation and usage of green material flow concepts are given priority considerations in order to fulfill our mission to produce environmentally friendly products.


Satisfaction SurveysCPT’s qual i ty pol icy is to place customers f irst,

enforce participation from all employees, and eliminate all shortcomings.

To address different needs of different clients around the world, CPT also established maintenance service centers in select locations in Europe, the Americas, and Asia to provide clients with instant and rapid post-sale service. Through regular client satisfaction surveys, our intention is to find our competitive advantage from client assessments on their satisfaction levels of product information, design, quality, delivery schedules, reliability, post-sale services, coordination, management of restricted materials, and other important issues. The aforementioned indicators are aggregated and reviewed in operational management review meetings to facilitate comprehensive assessments and trending comparisons with industry benchmarks, in order to act as the company’s reference data for short and long term business plans.

Customer Privacy ProtectionTo protect customer privacy, CPT’s relevant departments

will discuss and formulate privacy strategies and policies that fulfill the requirements of each department for private documents according to practical needs. For CPT’s upstream and downstream contractors, periodical bulletins and communication systems are in place. Internally, CPT executes measures such as internal and external audits and specialized task force management, and standardizes response and processes for when confidential documents or technologies have been leaked.

CPT has strict management standards for customer privacy or product information, and therefore did not suffer any fines from any such violations.

Customer Relationship Management

CPT is committed to understand its clients’ needs. Through long term partnership relationships, we have earned the trust and satisfaction of our clients. Through intensive communication, we not only instantly respond to client issues, we also convey CPT’s sustainability principles to our clients. Therefore, holding regular client satisfaction surveys is an important part of client relations management.

Preparation Work

Provision of List of Targeted Customers for Survey ●SPD

Confirmation of Correspondence Window between Target and CPT ●CSD

Execution of SurveyContact all CPT Windows to Perform Customer Satisfaction

Survey Work ●CSD

Proactive Contact and Progress Tracking with Customers from CPT Windows●CSD ●Sales ●FAE

Data Gathering and AnalysisCompilation of Questionnaires within Individual CPT Windows

●CSD ●Sales ●FAECompilation of Questionnaires from All CPT Windows & Data

Analysis & Comparison ●CSD

ReviewSubmission & Assessment of Questionnaire Analysis Results to Relevant Units ●CSD

Continuous Improvement of Relevant Units ●Responsible Units

Incorporation into Management and Evaluation REVIEW ●QSP

Customer Satisfaction Survey Procedure

Customer: Mr. Roy Kim / General Manager of Hydis Taiwan

Since CPT began its FFS cooperation with Hydis in 2011, CPT provided Hydis wi th invaluable support and assistance over new p r o d u c t d e v e l o p m e n t , technological exchange, and quality service. Additionally, CPT utilized its own mass production advantage to lower costs and provided directions based on its acute

market sensitivity, which greatly enhanced Hydis’ competitiveness in a usually competitive electronics industry.CPT had a lways p layed the ro le of product manufacturing assistance in its corporation with Hydis, and grew with our group. They provide market technological trends to assist Hydis with designing and developing new products. CPT has advantages over effective cost control and mass production, which can increase Hydis' advantage to fulfill market demand.

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Carbon and Water Footprint CertificationsAfter CPT acquired carbon footprint certifications for its

15.6 notebook boards in 2010, CPT officially initiated carbon and water footprint certification for its vehicular boards in June 2011 to account for its transformation towards medium and small size applications, CPT secured dual carbon and water footprint certifications for its 6.9 inch vehicular board products from international certification agency SGS in December 2011. CPT became the world’s first company to simultaneously complete carbon and water footprint certifications for vehicular board products. The primary stages of carbon emissions during the production of such products include raw material production, parts assembly, and sales delivery. Water used in such production consists primarily of blue and grey water. Through carbon and water footprint statistics, we can understand the environmental impacts of the product from different stages of production, and use this data as reference data for carbon emission reduction measures and actions over supplier material production, CPT’s parts assembly processes, and material / product sales delivery.

Innovative Materials and

Technology R&D

CPT continues to implement its green product design concepts after 2010. In 2011, CPT initiated carbon reduction action plans for its products, completing carbon and water footprint certifications for the 6.9 inch vehicular LCD boards. In 2012, CPT will further its energy conservation, carbon reduction, and water conservation activities. We hope to utilize a series of green product plans and activities and incorporate upstream and downstream participation from the industry and jointly create a green vision toward becoming a green corporation.

Analysis of Carbon Emissions from Vehicular Boards

Raw Material Production

Parts Assembly

Sales Delivery

Total Carbon Emissions

Percentage 44.68% 44.08% 11.24% 100%

Analysis of Water Usage from Vehicular BoardsRaw Material Production Parts Assembly Total

Green Water 0% 0% 0%

Blue Water 4.6% 9.1% 7.4%

Grey Water 95.4% 90.9% 92.6%

Total 100% 100% 100%

Note: 1. Parts assembly refer to: water usage at Array, Cell, and Module plants and CF

plant 2. Raw material production refers to: material production stage of CPT’s first tier

suppliers.3. Green water: gathering rainwater within soil or rainwater that escaped from soil

to act as a source of water for industrial plants. Amounts of green water used are calculated for materials involved.

4. Blue water: gathering general groundwater and natural water for use. This data can be gathered from general water meters. Allocations are based on the production volume of materials involved during inspection period, and then the blue water usage for that material is calculated.

5. Grey water: amounts of water required to reduce pollutant concentrations of wastewater to acceptable concentration levels that can be sustained by the destined water body when plants release wastewater to a destined water body in nature.

6. Water footprint calculations for raw material and manufacturing phases include blue water and grey water. Electronic products use almost no green water, which is not within the scope of this inspection.

Winning the First Taiwan Green Classics Award

The “Taiwan Green Classics Award” was established in 2011 as part of the “Green Trade Promotion Project” of the Bureau of Foreign Trade of the Ministry of Economic Affairs. Outstanding green products and green services provided by domestic enterprises are nominated to accentuate the value of Taiwan’s green production. In October 2011, CPT’s 21.5 inch USB wireless energy efficiency low carbon monitor passed the four major evaluations of “environmental product value,” “green supply chain,” “innovative technology and green sales,” and “corporate social responsibility” from the evaluation team to win the first Taiwan Green Classics Award. There are four major environmental benefits of the 21.5 inch USB wireless energy efficient low carbon monitor (including packaging design):1. No electric cable, VGA signal cables, or electrical

adaptors, which reduce the usage of electric cables, electrical adaptors, and VGA signal cables. The design reduces parts and enables cost reduction and reduces volume of waste, which fulfills green design concepts.

2. Super energy efficient: the electricity consumption of this product’s 21.5 inch USB is 30% of CCFL and 50% of LCD.

3. Simplified green product design: no additional display card required, and can provide for connections to multiple screens.

4. Green packaging and reduced weight of paper materials: 10% reduction of paper containers, which increases cargo loading rate by 10%.


Voluntary Packaging Reduction

Since late 2009, CPT and four other display and laptop companies had signed a packaging reduction agreement with the Executive Yuan. In February 2011, after the results from the 2010 packaging reduction agreement were announced by the Executive Yuan, CPT and other participating companies signed another packaging reduction agreement with the Environmental Protection Agency.

In December 2011, CPT signed its third “packaging reduction agreement” with the Environmental Protection

Administration. This agreement proposed two medium to small green packages: the universal TFT transportation box (3.7 inches) and paper-free Dense Pack Box (3.2 inches). The green packaging design allows for 50% weight reduction in packaging paper materials, 40% increase in board transportation efficiency, and 55% carbon reduction. The universal design reduces packaging module costs, while the overall packaging material cost is reduced by 60%. CO2 emissions are reduced by 60 tons and 13 tons, respectively.

Redute Resource Consumption and Implement Easy Recycle Design

CPT insists on green design concepts in its product packaging, which not only provide product safety protection for clients, but also achieve the objectives of environmental carbon reduction and effective resource application. Also, due to reduced product packaging materials, products become lighter and easier to transport, which also indirectly reduces product warehousing and transportation costs and creates more profits.

Green Product Innovation Cases

Product name

7” Touch Screen Pad (070ZT92) 7” TAP Pad (070NP01) 13.3” LED NB Display (133UA03)

Product InnovationProduct Innovation: traditional 0.7mm glass is replaced with 0.5mm glass to conserve resources and reduce weight, making the Pad more suitable for travels abroad

The first 6th generation HFFS high permeability product, which reduces traditional 0.5mm glass to 0.3mm in thickness to achieve resource conservation and also reduce weight and make Tap more suitable for business trips

Traditional 0.5mm glass is replaced with 0.3mm glass to conserve resources and reduce weight, making the NB more suitable for travels abroad

Green Product Characteristics

all LED lights used are mercury-free products

18% weight reduction compared to models of the same size (28g-23g)



29% thickness reduction compared to models of the same size (0.7mm-0.5mm)



Mercury-free

Weight reduction

Thickness Reduction

Photograph of green packaging design

Before improvement: boards are placed into trays

After improvement: slot pads can be used flexibly to contain multiple boards according to different model sizes

Universal TFT Transportation Box (3.7 inches)

Photograph of product packaging characteristics

Paper-Free Dense Pack Box (3.2 inches)Before and after comparison of improvements to paper boxes

before improvement after improvements

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Source ReductionTo reduce environmental damages caused by waste

fluid produced during the manufacturing process, CPT will recycle and reuse waste fluids as part of its corporate social responsibility.

To realize its corporate social responsibility and reduce the environmental impacts of waste fluid produced during the manufacturing process, parts of the solutions used in the TFT display manufacturing process is released after being processed by contractors approved by the Environmental Protection Agency or CPT’s own wastewater treatment system. For recyclable and reusable solutions like stripper solutions, light resistance dilution fluids, chromium etching fluids, aluminum etching fluids, NMP, hydrofluoric acids, etc., such waste fluids are recycled by their original suppliers, converted back to industrial or electronic grades, and then resupplied back to the TFT-LCD manufacturing process to reuse. Waste in all plant areas are turned into resources / recycled and reused wherever possible.

In 2011, CPT started from source reductions of manufacturing chemicals, optimizing operational coefficients for mechanical platforms and continuing R&D for nonhazardous chemical replacements. Waste materials at the manufacturing end are naturally reduced, which demonstrates CPT’s optimal environmental protection solutions, and achieves win-win scenarios that address cost reduction and environmental protection.

Recycling and Reusing Chemicals

CPT starts from source reduction and continues to research and develop non-hazardous chemicals. Waste fluids are also adequately recycled and reused. CPT executes the best solutions for environmental protection to achieve win-win scenarios for cost reduction and environmental protection.

2009 2010 2010

Total Amount of Fluid Waste 11,446.80 14,964.14 14,969.10

Solvent Solution Waste 424.38 1,276.32 5,697.00

Solution Waste… (Acid Waste &Base Waste) 5,309.08 5,739.14 159.20

Chromium Etching Fluid Waste (Requires Processing) 167.64 1,095.74 1,839.89

Iron Fluoride Waste (Requires Processing) 52.46 81.24 73.38

Organic Solvent Waste (Requires Processing) 1.98 5.43 12.06

PGMEA Waste 2,299.80 3,299.00 2,696.01

CP Light Resistance Fluid Waste (Requires Processing) 24.50 0.00 0.00

Cr-etchant Waste 636.10 774.38 419.90

Acid Waste 1,093.50 1,262.89 1,289.76

Alkali Waste 558.12 581.81 601.08

Fluid Waste that Required to disposal 478.78 442.46 1,998.80

Oil Waste 400.14 405.73 177.08

Amount of Recycling Fluid Waste 10,721.12 14,234.33 12,583.62

Amount of Disposal Fluid Waste 725.36 729.81 2,385.48

Fluid Waste Recycling Ratio 93.66% 95.12% 84.06%

Note: overseas plants are module assembly plants, which do not require large volumes of solvents and solutions, and therefore are not listed in the statistics. The Hukou plant was sold, and therefore not listed in the 2010 statistics.

Analysis of Fluid Waste Produced by all Taiwanese Plants (unit: tons)

Improvement Plans and Expected Benefits of Chemical Usage Reduction in 2011

Plant Proposal Reduction (Tons/Year)

Taoyuan Plant

Addition of new recycled light deflection system implemented to the APC010 & APC020 equipment

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Extended exchanges for AL testing fluid 57.225

Extended exchanges for Cr-T processing fluid 27.528

Reductino of ITO etching fluid usage: adjustment of exist fans to account for reduction of ITO membrane thickness

32.4

Lungtan Plant

Implementation of SUS AK fans for etching machines: improvements to fan deformation issues and reduce fluid output

17.778

Yangmei Plant

PS light deflector from light deflector recycling unit recycled and reused 12

Extended exchanges for CBM etching fluid: increasing the life cycle of etching fluid through temperature controls

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Encourage Suppliers’ Green Management and Green ServicesCPT is accountable to international legislations and client requests on green products. CPT needs to work with its suppliers to secure orders from clients. CPT needs to provide considerable product certification information to clients for confirmation, and therefore the Green Product Management system was introduced in 2010, which accelerates the green material confirmation process. Suppliers have been highly supportive and appreciative of CPT’s controls over restricted materials, as their materials all fulfill relevant requirements. CPT hopes to create a complete green supply chain system.


Green Product PolicyCPT Green policy: compliance with legislation and client

requirements, provide products with no harmful substances, and strive towards developments of green designs. The RoHS and WEEE of the European Union require that products be free from restricted environmentally harmful substances. CPT also fulfills client requests of recycling rates of Waste Electronics and Electrical Equipment, avoiding excessive electronic and electrical waste from end products going into landfills and increasing resource reuse ratios in order to reduce environmental impacts from products.

CPT abides by the spirit of RoHS, including environmental designs, compatibility assessments, self declarations, and appropriate disclosure of information for consumers. CPT provides products free from harmful substances, actively monitors information on environmentally restricted substances, and takes priority in identifying requirements from international green legislations and NGOs. CPT continues to consolidate its green supply chain, promote systematic controls, and provide clients with products free from harmful substances.

Supplier Rating and ImplementationCPT ensures that the quality and delivery date of and

substances used to manufacture products supplied by our suppliers meet the required specifications and facilitate smooth manufacturing processes through careful selection and affirmation of materials, management of suppliers and control of materials and supplies. We purchase our materials at reasonable prices to maximise the company’s profitability.

To ensure that a new supplier meet CPT’s requirements, we rate each new supplier on the basis of a written assessment of its qualification to evaluate as to whether it meets our procurement requirements; and we also send the company’s representatives to conduct an on-site assessment at the new supplier’s premise to evaluate as to whether it has established sound systems and maintains sound financial conditions and business reputation by examining its control of hazardous substance, quality system management, process management and production plant.

Sources of raw materials, size of production facility, technology and supply capability/reliability must also satisfy our assessment criteria. Facing the intense competition and volatile market conditions of the TFT industry, we are thankful for all of our partnered suppliers in persevere at these challenges with CPT.

Promot ion of Greenhouse Gas Reduction for Suppliers

In 2011, a total of 11 suppliers participated in the organizational audit and response for greenhouse gases. A total of 2.1 million tons of CO2 equivalents of greenhouse gases were emitted that year.

In terms of configuring greenhouse gas emission reduction targets, CPT requests its first tier suppliers to conduct greenhouse gas audits and studies over greenhouse gas reduction activities. The 27 suppliers who responded to our survey are all implementing greenhouse gas reduction action plans. 6 such suppliers have set greenhouse gas emission reduction targets, and 2 such suppliers are asking their first tier suppliers to conduct greenhouse gas audits.

Scoring, Auditing and Assistance on

Meeting Green Product Requirements

CPT is monitoring global environmental trends and actively ensuring that its products meet green product requirements. Through the “supplier end procurement compatibility mechanism” and IECQ QC080000 harmful substance procedural management system, we can lower harmful substances used in our products and integrate plant control and identify harmful substances, thus complete controlling the compatibility of material used.

2011 Supplier GHG Survey

Yes No

Has your company established targets to reduce your greenhouse gas emissions? 6 21

Is your company requesting direct cooperation from your suppliers in your greenhouse audits? 2 25

Implementation of energy efficiency and carbon reduction projects 27

Supplier: Li-Wen Wang, Headof Technical Integration, Kenmos Technology Co., Ltd.

Starting from 2008,CPT actively promotes green w o r k p l a c e s , i n f u s i n g energy efficiency concepts into daily life, and gradually promotes carbon reduction concep ts to a l l o f i t s suppliers. We are fortunate to be undertaking social responsibilities with CPT to fulfill CPT’s emphasis on environmental protection. Through CPT’s patience, supervision, and guidance,

we were able to assist CPT pass the carbon footprint certification from SGS during the carbon footprint certification event in 2011, becoming a certified member of the supplier carbon footprint certification program. We hope to continue receiving guidance from CPT to create win-win solutions and grow together.

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Promoting Supplier CSRFrom 2011, CPT has broadened the coverage of green

issues to include not only product related issues but also others to foster sustainable management. We extended the scope of the annual supplier conference and renamed it the Green Issues and Sustainability Forum, of which the objectives included continuous promotion of supplier CSR and passing on CPT’s “Green Life, Green World” spirit to suppliers, implementing the low-carbon action plan (“Green Actions”)

In 2011, CPT was awarded with Taiwan’s first Green Classics Award, and completed dual carbon and water footprint certifications for its 6.9 inch vehicular LCD product. This is the shared fruition between CPT and its suppliers. Due to the support we received from our green partners in terms of products, CPT was able to achieve breakthrough and growth on mobile communication, vehicular, flat screen, and touch activation markets. To thank and recognize the diligence and cooperation of all of our outstanding suppliers, CPT nominated its ten top suppliers who scored best on our indicator-based evaluations to present the outstanding suppliers awards of 2011.

Starting from 2012, CPT’s supplier conference and environmental quality and sustainability forum will further incorporate requirements over supplier product quality and promotion of carbon reduction actions. Suppliers will also be asked to abide by corporate social responsibilities and the EICC.

Supplier: Jing-Lin Yang, GP Personnel, Nippon Electric Glass Taiwan Co.

L e g a l c o m p l i a n c e i s a f u n d a m e n t a l q u a l i f i c a t i o n . C P T a l w a y s p e r f o r m s above fundamenta l requirements when it comes to sustainable business operations, and had always taken l e a d e r s h i p a m o n g Taiwanese corporations o n p l e d g e s a n d p e r f o r m a n c e o v e r issues related to EICC and the environment. In recent years, CPT had promoted many green act ions, f rom

carbon footprint certifications in 2009 to issues such as the completion of green packaging designs and carbon footprint certifications for LCD pads, we can observe CPT’s passion to protect Earth and its attention to detail over environmental protection.Taiwan Nippon Electric Glass received the ISO9001, ISO14001, and OHSAS18001 certifications between 2005~2007. In recent years, considerable investments were made over product quality, the environment, and safety management. Execution of project management has facilitated the achievement of management system objectives. At the same time, we are also conducting relevant actions such as carbon footprint audits, energy conservation, carbon reduction, water conservation, and introduction of green products to prove Taiwan Nippon Electric Glass’ commitment and management over planetary protection and environmental protection. CPT continues to support environmental issues and continues to enforce carbon footprint management and water resource management to fulfill the management objective of energy efficiency and carbon reduction. Taiwan Nippon Electric Glass hopes to work with CPT to jointly undertake corporate social responsibilities appropriate for corporate citizens and collectively care for our home planet Earth.

Supplier: Allen Tsai, Manager, Sitronix Technology Corporation

As a supplier for CPT Group, Sitronix recently established close cooperative relationships with CPT to jointly grow in an intensively competitive market. During this period, we have observed CPT Group’s business principles of environmental management. As a supplier of CPY, we cooperate with their implementation of EICC for suppliers, and enforce management policies pertinent to environmental and labor safety.As a pioneer in advanced management concepts, CPT had already enacted corporate social responsibility and environmental responsibility plans in 2008, formulating and disclosing corporate social responsibility reports. As a supplier to CPT, we are also well aware of CPT’s diligence in these endeavors, and provide our active support.


Implementation of the EICC

CPT values human rights and has serious regard for environmental, safety, hygiene and ethical management requirements. Therefore, we continue to systematically promote the Electronic Industry Code of Conduct (EICC) system, and expand the system towards our suppliers. We also ask our suppliers to promote EICC to higher levels to demonstrate their commitment to fulfil their corporate social responsibilities.

Management of Conflict MineralsTo prevent inappropriate actions incurred from production

and transaction of conflict minerals from African countries, the US has officially passed legislation on July 21, 2011, that empowers American stock exchanges to require disclosure reports of metal production sites of all products sold to the US in the future to track the source of minerals so as to prevent importing products with conflict minerals. To comply with such legislation, our clients have requested CPT to audit the mineral smelting contractors of its suppliers. CPT will work with client requests and initiate special investigations. This investigation was completed on December 9, 2011, by dedicated departments in the Green Product Planning Department according to the “Conflict Free Smelter Contractor and Responsibility Investigation Form.” Investigation results indicate that no supplier is using metal from conflict minerals.

Revision and Reassessment of E-TASCAt the request of our clients, CPT continued to sign up to

the Electronics - Tool for Accountable Supply Chains (E-TASC) System (website: www.e-tasc.achilles.com) during the period from 2008 to 2011. On August 11th 2011, the E-TASC platform maintenance center notified that version 1.7 will be updated to version 2.0. CPT had completed the EICC questionnaire and assessment for version 2.0. Since 2008, CPT had been working with client requests to gradually complete EICC requirements and improvements. Therefore, the results of this assessment speak for CPT’s EICC implementation results, which are more compatible with EICC requirements. In the future, CPT will continue participating in this platform. Clients or stakeholders of CPT may learn about CPT’s efforts in adopting and adhering to the EICC through this platform.

Conflict MineralsConflict minerals currently include:1. Coltan, which is refined into titanium: approximately

17% of global supplies come from the Democratic Republic of Congo.

2. Cassiterite, which is refined into tin: approximately 4% of global supplies come from the Democratic Republic of Congo.

3. Wolframite, which is refined into tungsten: Congo is the world’s 5th largest producer, accounting for approximately 3% of global production.

4. Gold: approximately 2% of global supplies come from the Demcratic Republic of Congo.

Note: Data based on the USGS estimates (2008)

In-Region sourcing Conflict Free Smelter Program Company Due Diligence

MINE SMELTER OEMS

Finished Product

CPT Declaration of Non-Use of Conflict Minerals

CPT respects global human rights, and wil l undertake social and environmental protection responsibilities. CPT abides by EICC regulations to not accept illegally mined titanium, tin, tungsten, or gold from Congo and nearby regions of conflict. CPT will also inform and require its suppliers to adhere to the aforementioned declaration.

E-TASC website: http://e-tasc.achilles.com/

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Results and OutlookStarting from the third quarter of 2009, CPT initiated

multi-stage plans to require suppliers to cooperate with EICC compliance, greenhouse gas audits, product carbon footprint audits, proposal of carbon reduction target plans, etc. Between 2010~2012, CPT conducted promotion and sharing of CPT’s related executive experience and relevant education and training through the supplier conference, with hopes that suppliers can work with CPT so that the CPT supply chain system can create a positive image that addresses labor, human rights, safety, and environmental sustainability, and increase client confidence.

1. 45 suppliers were audited on site (68 were audited in 2010). Audit results did not uncover major violations against EICC. Primary incidents of incompatibility include: work hours not allowing for 1 day of rest for every 7 days of work, which is not compatible with EICC standards, partial fines paid by deductions, lack of standards related to non-discrimination in place, lack of identity confidentially and complaint procedures in place, etc.

●Taiwan region: 2 suppliers qualified● China region: 43 suppliers were audited. 33 qualified,

while 10 had qualifying conditions.● CPT TPV Optical (Fujian) Co., Ltd. and CPT Display

Technology (Shenzheng) Ltd.: they have no suppliers due to being strictly processors. Therefore, no audits are necessary.

2. 144 responses to sustainability policy declaration (62 responses in 2010):

●Taiwan region: 25 responses.● 14 suppliers responded to CPT Display Technology

(Fujian) Ltd.● 35 suppliers responded to CPTF Visual Display (Fuzhou)

Ltd.●70 suppliers responded to CPTF Optronics CO.,Ltd.● Responses were completed to Chunghwa Picture Tubes

(Wujiang) Ltd. in 2010. CPT TPV Optical (Fujian) Co., Ltd. and CPT Display Technology (Shenzheng) Ltd.: they have no suppliers due to being strictly processors. Therefore, no audits are necessary.

3.CPT-Supplier Actions in 2012●Support for CPT’ s enforcement of EICC management– Cooperation with on-site audits of corporate social responsibility (EICC)

– Response to corporate social responsibility (EICC) questionnaires

– Labor policy of the supplier EICC behavioral doctrine, EICC corporate social responsibility documentation system establishment and formulation of EICC execution plan schedule

–Establishment of blood (conflict) metal policy– Compatibility with transparent supply chain requirements in California, US

– Formulation of corporate social responsibility report schedule

– Establishment of occupational health and safety and environmentally related international standard systems

– Promoting corporate social responsibilities (EICC) for subordinate suppliers

● Supporting CPT’s Enforcement of Energy Efficiency and Low Carbon Management

– Implementation of ISO500001 energy management system

– Water resource management: open reporting of water resource consumption statistics, open reporting of water resource consumption reduction targets and schedules

– Solid waste management for suppliers: open reporting of solid waste production statistics and solid waste reduction targets and schedules

– Climate effects: greenhouse gas emission reduction targets for 2012, reduction statistics in 2011 (with 2010 as the base year), and greenhouse emission audit calculations for 2011 Outstanding

Outstanding suppliers are commended as they jointly fulfil EICC and corporate responsibilities with CPT


Green & Local Procurement

Units responsible for green products within CPT had established green management procedures for materials from suppliers. All plants can share all restricted material reports of suppliers from the Green Product Management (GPM) system to accurately monitor the quality of materials from suppliers and request compliance with CPT’s green product requirements.

Green ProcurementThe complete compatibility procedure for supplier end

procurement works as follows: when procurement orders are made, personnel from the Green Product Planning Department evaluate the procured materials according to the restriction substance management procedures for suppliers from the GPM system. If procured materials meet CPT’s requirements, orders can be made for specific materials. If procedure materials do not meet CPT’s green regulations, procurement cannot proceed. However, to avoid concerns of material shortage, immediate procurement mechanisms exist, which also require evaluations from personnel of the Green Product Planning Department so as to enable CPT to effectively control requirements over restricted substances.

To enhance the restricted substance management system of CPT and its suppliers, CPT’s GPM system is being optimized after its implementation to Taiwanese plants in 2008. Starting from the fourth quarter of 2010, GPM is introduced to Chinese plants, and fully implemented in 2011.Chinese plants can share all restricted substance reports of suppliers from the GPM system. Through the GPM system’s supplier information, tracking and management can be tailored to specific categories, fully maximizing the efficiency of restricted substance management of suppliers through the GPM system.

Starting from the third quarter of 2011, the GPM system was adjusted to account for implementation of the SAP ERP system in CPT. SAP is used to replace the original AS400 system, and the transition is completed on July 1, 2011. Manual maintenance and inquiry of the SAP GPM was optimized in the first quarter of 2012, shortening system inquiry time for users.

EICC Declaration Requirements for Procurements

CPT had incorporated EICC requirements to its written orders, EC platform web page, and basic procurement requirement contracts in 2010 to address client requests. Through this method, CPT requests its suppliers or affiliates to agree to comply with the EICC to jointly enhance our corporate social responsibilities. Therefore, in 2011, all suppliers or affiliates who supply procurement to CPT agreed to comply with the EICC to ensure that suppliers or affiliates provide safe working conditions, respect and dignity for workers, and environmentally accountable production processes. All activities conducted need to comply with government legislations to fulfil corporate social responsibilities.

1. Written orders include the following stipulations: “First tier suppliers shall acknowledge and implement the Electronic Industry Code Conduct.”

2. Addition of EICC declaration requirement page to the EC platform: suppliers or affiliates of CPT shall agree to abide by the working conditions and human rights of labor, health and safety, environmental responsibility, management system, and eth ica l regulat ions in their provision of products, services, and raw materials to CPT. They shall also agree to allow CPT representatives to assist with and inspect compatibility situations to ensure that working conditions provided are safe, employees are respected and dignified, production procedures are environmentally responsible, and all activities conducted comply with government legislat ions, in order to ful f i l l corporate social responsibilities.

3. The aforementioned text is added to basic procurement requirements contracts.

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Use of Local MaterialsTo effectively lower procurement costs, CPT is actively

developing and introducing competitive domestic contractors. Therefore, the ratio of local suppliers increased by 5% compared to 2010. Also, due to the production of module plants of IT and CEBU departments transferred mostly to China, the trend of local procurement resulted in direct supply from local Chinese contractors. Only small procurements for testing purposes are made in Taiwan. Therefore, Taiwanese suppliers occupy lower shares of primary material procurement value. CPT is actively introducing local suppliers, and requesting suppliers to establish production plants locally and supply locally, in order to reduce energy and resource waste from transportation processes. We are proud to announce that in 2011, 29.56% and 87% of our major procurements by our production plants in China and Taiwan, respectively were sourced from local suppliers.

Green Transportation ManagementCPT is also intent on reducing environmental pollution

and reducing resource exhaustion by using advanced transportation technologies to plan and execute actions such as personnel and cargo transportation, warehousing, loading and unloading, and packaging.

In terms of energy conservation and carbon reduction related activities for CPT personnel, the company provides free shuttle busses to reduce pollution from our colleagues driving to and from work, which not only reduces resource cost, but also reduces commuting costs for our colleagues. Also, company shuttle buses are required to be turned off when waiting inside plants to reduce carbon emission, while usage time limits also exist for shuttle busses. A ride sharing media platform service is also provide to CPT colleagues to encourage ride sharing among colleagues and achieve employee participation in the mission for energy conservation and carbon reduction.

CPT’s vehicle and personnel dispatch plans call for materials of the same routes to be concentrated in the same vehicles to reduce the number of vehicles and trips required, as well as reduce expenditures, increase transportation efficiency, reduce material damage and material transportation rate, and thus effectively resolve repeated transportation and traffic congestion issues. Also, drivers are asked to maintain good driving habits. When driving on highways, sudden acceleration or sudden brakes should be avoided to ensure driving safety and reduce fuel consumption and carbon emissions.

CPT’s primary storage facil it ies are warehouses. Through reasonable categorization and placement, the number of ineffective transportations from loading and unloading materials and retention and retrieval routes can be reduced to increase the flexibility of transportation and ensure stability and functionality in material transportation.

Green packaging is closely related to transportation, storage, and loading and unloading in mater ial f low management. Excessive packaging results in resource waste and large packages that are difficult to transport. Therefore, recycled packaging is becoming more widely used due to the ease of recycling. CPT continues to promote green packaging design principles that “conserve resources,” “enable easy recycling,” and “reduce pollution.” In 2011, 14.91% in packaging weight reductions was achieved for small and medium size packages, while 24.31% in packaging weight reductions was achieved for large size packages. Sufficient utilization of the characteristics of different types of materials can reduce overall package weight reduction, size reduction, increase in cargo loading rate, and address both environmental protection and business costs.

Note: Ratios of procurement from local suppliers = (amount of local procurement+ amount of local processing of materials procured from non-local sources) / (amount of local procurement + amount of local processing of materials procured offshore + amount of materials processed & procured from nonlocal sources)

Ratios of Local Procurement from All Units of Taiwanese Plants in 2011

Ratio of procurement from local suppliers

2011China2010 Taiwan

Procurement Dept. 1

Procurement Dept. 2

Engineering Facility Dept.

Small/Medium-Sized Business Group

VD BusinessGroup

Procurement from Non-local Suppliers

Procurement from Local Suppliers

Procurement from China

Procurement from Taiwan

94%

100%

97%

65%

40%

100%

80%

60%

40%

20%

0%

87%82%

23% 29.56%

Establish LOHAS Working Environment and Voluntary Environmental ConservationEmployees” had always been CPT’s most vital assets. CPT is committed to create a working environment filled with passion, health, compassion, learning, and innovation. We work hard to create a platform where employees can harness their talents. We also provide employees with reasonable and competitive compensation and benefits, and we also continue to enhance bilateral communication channels with employees. As well, we provide all employees with comprehensive educational training and employee development classes as we continue to assist employees with increasing professional capabilities and self-growth.


Global Employee AnalysisThroughout its development until the end of 2011,

CPT employed 16,227 employees around the world. 6,143 employees are female, accounting for 38%. 10,084 employees are male, accounting for 62%.

In a competitive age of knowledge-based economies, CPT understands that personnel are a critical factor to the company’s sustainable operation. We continue to invest in increasing the competence of our manpower. In terms of education, 6% of all working employees in 2011 had a master’s degree or higher level of education (male: 7.66%; female: 3.39%). 39.98% of all employees have university or technical degree education (male: 47.34%; female: 27.89%).

CPT attaches importance to employee welfares and development. We are constantly seeking young graduates to join our team to ensure that we stay as a vibrant and energetic company. As at December 31, 2011, the average age of CPT’s employees was 28 years old (male: 28 years old; female: 27 years old); 59% (male: 55%; female: 65%) of employees were aged 30 years old or under and 41% (male: 45%; female: 35%) were aged over 30 years old.

Protection of Human Rights

According to CPT’s recruitment policy, the company does not discriminate candidates by race, social class, language, thinking, religion, political party, nationality, gender, marital status, appearance, features, mental or physical disabilities, birth place, sexual inclination, age or past membership with a union. There is no gender discrimination in our wage system. All employees enjoy equally fair promotion opportunities.

Number of Global Employees

Employee Trunover Rate by Year

company plant 2009 20102011

total males females

Chunghwa Picture

Tubes, Ltd.

CPT Taiwan 7.68% 22.12% 19.92% 22.81% 14.45%

CPTF Optronics Co.,Ltd.

30.84% 58.37% 145.61% 159.39% 130.96%

CPTF Visual Display

(Fuzhou) Ltd.69.45% 116.88% 189.13% 188.4% 189.82%

CPT Technology

(Group) Co., Ltd.

CPT (Wujiang)

Ltd.61.28% 71.84% 157.89% 162.59% 149.05%

CPT Display Technology (Fujian) Ltd.

48.91% 87.04% 116.98% 124.91% 102.3%

CPT Display Technology

(Shenzheng) Ltd.

69.50% 15.89% 111.54% 110.68% 113.59%

CPT TPV Optical

(Fujian) Co., Ltd.

-- 54.75% 89.95% 83.76% 99.66%

Note: number of employees leaving their jobs (includes retirements, resignations, dismissals, and deaths) / nmber of employees at the end of year

48015283

25403603

Taiwan

China

Ratio of Local Employees and Managers in All Plants

99%99.61%85.27%

52.63%

Taiwan China

Ratio of Full Time Employees

Taiwanese Plants

CPTF Visual Display (Fuzhou) Ltd.

CPTF Optronics CO.,Ltd.

CPT Technology (Group) Co., Ltd.

99.46%

100%

100%

93.43%

New Hires in 2011

1007

3213

883

1685

1254

718

1192

Male Female

CPT TPV Optical (Fujian) Co., Ltd.

Taiwanese Plants


CPTF Visual Display (Fuzhou) Ltd.

Chunghwa Picture Tubes (Wujiang) Ltd.

CPT Display Technology (Fujian) Ltd.

CPT Display Technology (Shenzheng) Ltd.

749 258

1860 1353

494 389

1135 550

891 363

503 215

695 497

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Compliance with EICCSince implementing the EICC, all of CPT’s plants have

been thoroughly enforcing relevant EICC regulations as they formulate employee policies that clearly declare and protect employee rights and fulfil corporate social responsibilities. Policies cover fundamental legal compliance, freedom of employment, humane treatment, and prohibit ion of inappropriate discrimination. In 2011, CPT’s clients notified that California’s transparent supply chain legislation from 2010 (SB657) was passed and will become effective on January 1, 2012. This legislation requires all large retailers and manufacturers doing business in California and earning global sales of over $US 100 million to terminate slavery and human trafficking in their supply chains. Due to clients complying with the aforementioned conditions, they request CPT to sign an agreement of compliance with California’s transparent supply chain legislation. CPT has also completed such signing and once again declares its determination to protect employee rights and fulfill its corporate social responsibilities.

CPT has put in place clear measures to prohibit the use of child labor. CPT recruits employees on the basis of the voluntary principle, which means that any employee has the right to vacate his or her position provided that he or she gives the company a reasonable period of advance notice of such intention in advance. The company does not request employee to hand in his or her identify documents such as the National Identification Card or passport or any form of “bond” as part of the employment criteria. CPT undertakes not to use any cruel or inhuman policy to manage our employees, including imposing any form of harassment, abuse, physical punishment, mental or physical stress, or verbal abuse. CPT’s offers above-average remuneration to employees at all our business locations. Employees are entitled to receive overtime payments in accordance with national regulations.

CPT has instituted a designated suggestion box to receive feedbacks from employments. The company has also put in place anti-harassment measures and complaint lodgment avenues to protect employees from sexual harassments at work.

Human rights considerations are incorporated as part of the training program of security staffs at our global production plants. Besides reinforcing staff training on legal requirements and company regulations, emergency rehearsals and promotion of traffic safety, the company also conducts training of the EICC system on all employees to establish employees’ appreciation for human rights.

Labor Unions & Labor NegotiationsEmployees of CPT enjoy the freedom of joining the union

and the right to participate in group negotiation. To provide a transparent bilateral communication channel and ensure that employee feedback or issues can be instantly resolved, the Head of the Human Resources Dept. attends union meetings to promote harmony between workers and the company. At present, a labor union, with 60 union representatives, has been formed to represent employees of CPT (Taoyuan). Up to 90% of employees of our Taoyuan Plant are union members. Similarly, Chunghwa Picture Tubes (Wujiang) Ltd., CPT Display Technology (Fujian) Ltd., CPTF Visual Display (Fuzhou) Ltd., CPT TPV Optical (Fujian) Co., Ltd. and CPTF Optronics Co. Ltd. also have legally established labor unions.

Employee: Kuang He, CPT Display Technology (Shenzheng) Ltd. (Tenure: 6 years)

Standing quietly in any corner in the company would remind me of the 6 years I have spend working in Shenchuan CPT Display Technology C o . , L t d . 6 y e a r s ago in May, I sa t i n a company bus as i t made its f inal stop in an empty plot of land in front of a billboard. The enthus iast ic HR

person told us that we have arrived. As I saw that scene, I could not help but remember the song “My Home is on a High Yellow Hill.” Hard and busy work was about to begin… under the collective diligence of my supervisors and colleagues, we went through plant construction in 2006, a fruitful 2007, a financially disastrous 2008, a steadily recovering 2009, and a transformative 2010 that saw the company shift towards OEM, etc.During this time, I went from technical personnel to base level manager. I turned from a youngster who just got into society into a young man who would shoulder considerable responsibilities. All of this was related to my supervisors, who had always been there to guide and help me, and the company’s corporate culture of “honesty, integrity, diligence, and frugality.” And, because of this, all the subsequent work was a better fit for my skills. I firmly believe that CPT will become elite in the TFT industry, because we have many outstanding colleagues and distinguished supervisors.


Employee WelfareCPT values the importance of administering a sound

employee welfare system and offers employees competitive remuneration and bonuses, which include meal allowances, performance bonuses, group insurance, and special subsidies for wedding, child birth, funeral and birthday. The company also offers other forms of caring services for our employees including employee accommodation, sports facility, night-shift snacks and shuttle bus services. Employees of our Taiwan operations are also entitled to acquire employee stock options, enjoy a flexible leave policy and female employees are also entitled to maternity leave.

CPT has built high-standard sports facilities including basketball court, swimming pool, aerobics, badminton court, table tennis room, and gym. The leisure facilities are open to employees, their families and community residents and the company is a proud sponsor of many community events. We also seek out third party liability insurance to offer sufficient protection and additional assurance to employees, visitors and neighboring communities.

To address an increasingly competi t ive working environment in the future, the company has sought out business insurance, in addition to labor insurance required under basic labor insurance regulations, to plan for a comprehensive welfare and pension support system, making it possible for us to assume full responsibilities as an employer for worked-related bodily injuries suffered by or death of an employee with the support of the occupational hazard insurance and employer liability insurance. We hope to establish an occupational hazard

pension support system that offers better economic benefits and medical care. The bigger-picture benefits are avoidance of labor disputes and waste of social resources.

Employee Health

Management

A healthy workplace is closely connected to employee health. In light of this, CPT has taken extra care to ensure employees’ mental and physical wellbeing. We engage in constant dialogues with employees to understand their true needs. On the other hand, we adopt a sound employee health management policy because we believe that employee productivity is dependant on good health, which is critical to support the company’s competitive strength.

Applications for Maternity and Child Rearing Leave of Absence in 2011

Taiwan China

Number of employees who qualified for maternity leave 134 183

Number of employees who applied for maternity leave 134 183

Number of employees who returned to work after maternity leave 104 166

Number of employees who qualified for child rearing leave

153(Male: 19, female: 134) 128

Number of employees who applied for child rearing leave

95(Male: 19, female:76) 92

Number of employees who returned to work after child rearing leave

80(Male:18, female:62) 91

Note: breastfeeding leaves are allowed in Chinese plants. Female employees may apply for 1 hour of breastfeeding rest per day each year.

Employee: Yi-Fa Ling, Longtan Plant (Tenure: 6 years)

I’m honored to be a member of CPT. The company’s benefits, treatment, and care for its colleagues make me feel comfortable. The most unique feature of our company is the gym within the company that is completely free of charge. This is a great and convenient benefit for me. Since I need to exercise after work, the company helps my body grow stronger in providing me with a place to relieve stress after work. Only a healthy body can undertake more challenges in the future and execute plans for the future. Therefore, as a base level employee of CPT, I believe I am not only earning money, but also earning a wealth of physical capabilities that increase my capacity to work, experience life, and expand my horizons. The various events and training classes held regularly by the company are frequently helpful towards increasing everyone’s vitality and knowledge, which not only enriches our lives and add color to our lifestyles, but also empowers our work with more innovation and enhances our performances at work.

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Health CareCPT cares about and addresses employee health. On

top of regular health inspections, inspection services are more extensive than legal requirements. Employee clinics / medical offices are established to provide medical service and information. Furthermore, medical professionals from all specializations are regularly invited to hold seminars, such as: free quitting seminars for smokers, stress relieve and enjoyment seminars, etc. Information on disease epidemic areas and prevention are regularly provided. Also, to encourage breastfeeding from employees that just gave birth, there are also aesthetically pleasing, independent, and discreet breastfeeding rooms. There are also parking spaces for pregnant women, providing comprehensive health care for employees.

CPT’s Taoyuan plant is also working with Kangjian Management Consultant Co. to facilitate in-house health insurance bureau-certified inspections. Doctors from National Taiwan University Hospital specializing in occupational medicine and gastroenterology would provide their services inside CPT’s plants, including diagnoses, blood sampling, stomach ultrasound inspections, health inquiries, topical medication replacement, public injury assessments, etc. Free stomach ultrasound and body fat measurement instruments are also provided for use free of charge. CPT extends this service to families of employees and community residents to fully utilize the available medical resources and to realize community care.

Primary health activities in Taiwanese plants in 2011 include:

1. Annual health inspection and tracking: specialized health inspections performed according to legal requirements. Individuals with abnormal inspection results in 2010 are tracked and provided with health management.

2. Blood donation: Organized 9 rounds of blood-donation events at production plants in Taiwan during 2011. A total of 1,365 people participated, and a total of 1,804 bags of blood were donated in the event.

3. Cancer prevention inspection: female colleagues are

encouraged to undergo regular breast and cervical inspections, and oral and colon cancer inspections are also expanded.

4. Bone density inspections: bone density inspections are held to allow employees to understand and prevent osteoporosis.

5. Physical capacity inspection: physical capacity inspections are held in coordination with the awareness campaign for bodi ly formation, cardiovascular endurance, flexibility, strength, and muscular endurance from the Executive Yuan’s Sports Affairs Council.

6. Vaccinat ion: CPT is working with the 2011 f lu vaccination plan of the Center for Disease Control of the Executive Yuan’s Department of Health. Also, to prevent cervical center for female employees, CPT is working to secure contractor discounts to finance its own HPV vaccination.

7. Health Seminars: includes topics such as prevention of excessive stress, prevention and treatment of cervical cancer, etc.

8. Dedicated mailboxes and web pages for health management:

Primary health activities for Chinese plants in 2011 include:

1. Seminar for prospective fathers and mothers: medical professionals are invited to teach prospective parents on child rearing knowledge. Approximately 60 people participated in the class.

2. Sunflower (health seminar): external experts are invited to hold emergency rescue knowledge seminars. 57 colleagues participated, which increased the on-site emergency rescue capabilities of our colleagues.

3. Heartfelt charity: medical professionals are invited to provide health inquiry service desks at the company, which also provides simple health inspections during breaks, such as: blood pressure inspection, vision, etc. The service also promotes health knowledge among our colleagues to ensure their health.

4. Medical knowledge seminar: medicine-related knowledge is promoted, while the importance of employee medical insurance is also promoted. Colleagues are encouraged to use medical insurance to protect their own rights.

5. Free physical inspection: professional personnel from the health bureau of Mawei district are invited to provide colleagues with free physical inspections and promote health knowledge.

Area

CPT CPT Technology (Group) Co.,

LtdTaiwan China

Number of services held / persons served

/ year0.73 1.55 2.53

In-House Medical Diagnoses

A successful swim across Sun Moon Lake demonstrates the healthy physique of employees.

CPT provides health inspections for employees and holds various health seminars.


Occupational Hazard

Prevention

CPT deeply understands that only an effective safety and health management can act as the vital foundation of the company’s sustainable development. We have implemented the plant’s existing safety and health system ISO14001/OHSAS18001 and TOSHMS (Taiwan Occupational Safety and Health Management System). Electronic platforms built through PDCA models are established to enable employees to file reports and ensure achievement of management objectives.

Policy CommunicationIn September 2011, CPT’s Taoyuan plant first began

implementing energy management system ISO50001 and ISO14001 environmental management system to act as integrating energy and environmental protection systems. The original environmental protection policy is amended into the environmental protection and energy policy. Energy conservation and carbon reduction is conducted through systematic management models to delve into manufacturing processes to discover potential for energy eff iciency improvements. CPT continues to communicate its policies to all stakeholders by following methods:

●Puts on education poster at the entrance●Safety committee help to assist the concept promotion●Conduct health and safety training● Organize community services and care event to carry

out the policy● Request supplier to promote health and safety policy,

and support organizations to explain, promote, communicate and negotiate related issues.

●Web page promotion and education●Publication of corporate social responsibility report

Environmental Safety and Health Management System

CPT completed certifications for ISO 14001 in 1997, OHSAS 18001 in 2001, and ISO14001/OHSAS18001/TOSHMS integrated system certification in 2008, as well as safety and health inspections for all plants in 2009. Management procedures for all plant areas are conducted in the spirit PDCA. All health-related performance is continuously refined and improved. In terms of training system operation management personnel within all plants, CPT uses internal audits and the Tatung parent company’s environmental safety and health committee to conduct regular audits to inspect system operation issues that require improvements and increase the operational efficiency of all systems in hopes that CPT can achieve the corporate objectives of environmental protection, disaster prevention, labor relations, social care, and lifestyle enjoyment. Web pages dedicated to environmental safety and health information, databases, and electronic systems are also established within the company’s internal web site. Through colorful design, colleagues can conveniently find information that they need, and the system acts as the environmental safety and health platform shared by all plants.

Employee: Bing Hsieh, CPT Display Technology (Shenzheng) Ltd. (Tenure: 4 years)

As I departed the classroom to Shenchuan CPT Display Technology Co., Ltd., I thoughtthat changing an overall environment would put me in a foreign land. But as I entered the company, the humanized management, comfortable working environment, park-like living community, and living quarters that are close to the school, all felt so familiar, which greatly reduced anxiety on those of us that just came out of school, and quickly joined this great family. As I have spent almost 4 years in this great family, I have learned and grown much in terms of everything from professional aptitude to social skills. The company gave me many opportunities. I remember my first time participating in an improvement plan, my first time independently completing an improvement plan, my first time in management… thecompany continued to enable me to grow and challenge myself.Over the last 4 years, the company weathered the global financial crisis, and survivedthe recession of the LCD industry. The company sought many solutions to the economic recession after the financial crisis. First, the company transformed its industry to outsourcing its manufacturing processes, and then developed more clients. We firmly believe that, after persevering through so much hardship, the company will elevate itself to new heights.

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Primary ResultsIn 2011, Taiwanese plants continued to introduce new

systems and equipments to enhance safety and health management. Primary activities include:

1. Safety and health performance indicator comparison system: to effectively measure the safety / health / environmental performance results of all plants, CPT has established a supervision, measurement, assessment, and discipl inary system in hopes that safety and health can be better enforced and achieve the result of zero incidents for all units in their responsible areas and promote the principle of “Safety is Line Responsibility.”

2. Emergency Response and Evacuation Rehearsal: plants can deal with sudden incidents skillfully at any time through participation from all employees. Additionally, all plants plan for expanded annual exercises to work with local government agencies or suppliers, who will also participate in such exercises. Response procedures range from first stage response to third stage external emergency rescue. Planning and execution procedures are regularly examined to determine whether they need to be amended.

3. Observation of operational safety: in 2011, field managers actively conducted work safety observations in hopes of further discovering unsafe actions in the f ield to achieve effective management and improvement.

4. CPT has implemented random testing mechanisms for the Interlock safety device for mechanical platforms. The Safety and Health Department schedule inspections of safety devices for mechanical platforms of all plants. Such work primarily consists of maintenance, repairs, and cleaning of mechanical platforms that can be tested. In order to avoid compromising field production due to inspection of safety devices, inspections are conducted during mechanical maintenance or shutdown repairs.

5. Infrared scan inspection mechanism: in order to discover and analyze abnormalities with electrical facilities of the plants early on, infrared scans (IR scan) are planned for all plants. Trained and qualified equipment operators are responsible for inspections. Infrared scans and inspect ions are conducted semiannually for electrical wiring and other regional facilities in order to monitor abnormal temperature increases of electrical connection points.

6. Zero-hazard Statistics and Installation of Safety and Health Promotion Billboard: safety and health performance of all units are displayed as weather patterns through the zero-hazard man-hour records screen and safety and health weather indicator diagram, which includes:

● “Sunny” indicates zero disasters for a unit, ● “Cloudy” indicates that a mild injury has occurred. ● “Rainy” indicates that a lost time incident has occurred

in a unit, resulting in the zero-hazard records of that plant being reset to zero.7. Es tab l i shment o f sa fe ty and hea l th meet ing

mechanisms: recorded safety and health meetings are conducted for all employees (including management levels) to encourage employees to understand relevant safety and health issues and work issues for their plants. Employees and suppliers jointly participate in response exercises of toxic leaks to fulfill safety culture. Infrared scans can uncover electrical equipment abnormalities early on.

Employees and suppliers jointly participate in response exercises of toxic leaks to fulfill safety culture.

In f ra red scans can uncover e lec t r ica l equ ipment abnormalities early on.

Contractor: Liang-Chien Lin, Site Superintendent, Baoxing Co., Ltd.

We have been doing business with CPT for over 10 years. W e s a w C P T ’ s departments working with contractors in well-planned fashion. Their plants grew from nothing to steadily increasing production

from the Taoyuan plant to the Longtan plant. We have participated directly and indirectly in this process, during which we have learned much of CPT’s requirements for safety, health, and construction management, which I can also apply when I work with other contractors. Our engineering quality and management had been enhanced considerably as a result, which benefits me greatly.


Safety and Health PerformanceIn addition to regular safety checks and audits, the

company also conducts periodic safety and health performance rating within the organization to fully implement our safety culture. We hope to gather the strength of supervisors and employees to promote the safety culture. Our accomplishments have far exceeded the standards prescribed by law. A summary of occupational hazards (excluding traffic accidents) occurred during 2011 was as follows: Disabling injury frequency rate was 0.191, disabling injury severity rate was 3.122 and total injury

index was 0.024 for CPT (Taiwan).

Safety and Health Performances

YEAR Injury Index Taiwan China

2009

Disabling Injury Frequency Rate 0.161 0.241

Disabling Injury Severity Rate 7.005 2.405

Total Injury Index 0.034 0.024

2010

Disabling Injury Frequency Rate 0.988 0.444

Disabling Injury Severity Rate 9.509 14.833

Total Injury Index 0.097 0.081

2011

Disabling Injury Frequency Rate 0.191(M:0.29F:0)

0.527(M:0.567F:0.474)

Disabling Injury Severity Rate 3.122(M:4.742F:0)

29.131(M:41.122F:13.089)

Total Injury Index 0.024(M:0.037F:0)

0.124(M:0.153 F:0.079)

Note 1: Disabling Injury Frequency Rate, FR = (Disabling Injury per employee hours × 106) / Total hours worked.

Note 2: Disabling Injury Severity Rate, SR= (Total loss days ×106) / Total hours worked.

Note 3: Total Injury Index, FSI=Square root of [Disabling Injury Frequency Rate (FR) xDisabling Injury Severity Rate (SR)] / 1000.

Contractor: Chuen-Rong Chen, Manager , Chenwang Cleaning Co.

As the s tewards o f env i ronmen ta l cleanliness of CPT’s Longtan plant, we frequently educate cleaning personnel during daily cleaning w o r k i n a d d i t i o n t o s y s t e m a t i c m a n a g e m e n t , s o t h a t c l e a n i n g personnel can learn the most effective and proper cleaning

methods, wh ich cont inua l ly enhances the techniques and knowledge of cleaning personnel and ensure outstanding service quality and work safety. Likewise, however, corporations need to provide safe working environments and reasonable compensation to achieve bilateral win-win principles. Also, we hope to achieve the following quality-based policy objectives with corporations:● Focus on pre-incident planning and preventative

measures as opposed to rescue.● Continuously increase corporate quality culture

and enhance core capabilities of employees and manage professional aptitude training.

● Continuously improve quali ty management systems, achieve outstanding service quality, and strive for client satisfaction.

● We further more to move forward with corporations on the objective of partnered enterprises based on the principle of sustainable development and work unequivocally towards coordinating and improving environmental cleanliness, creating a tri-win benefit between client, employee, and company, as well as a clean and comfortable environmental space.

Results of Emergency Response Exercise in 2011

Category / Number of People

Taoyuan Plant

Longtan plant

Yangmei Plant

Chunghwa Picture Tubes (Wujiang) Ltd.

CPT Display Technology

(Shenzheng) Ltd.

CPT Display Technology (Fujian)

Ltd.


CPTF Visual Display

(Fuzhou) Ltd.

CPT TPV Optical

(Fujian) Co., Ltd.

Fire Safety Training 146 406 100 350 122 337 1302 76 50

Emergency Response Commander 20 42 84 7 1 0 0 0 0

Emergency Response Team 83 356 40 0 280 0 0 0 0

Emergency Response Exercise 146 104 170 6990 1279 1562 2926 901 2440

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Sharing of Safety and Health ExperienceCPT is committed to increasing its own safety and health

performance. Through experience sharing, Taiwanese plants are also assisting enterprises in neighboring regions:

1. Disaster Prevention Science Education Center tours: through actual experience and feel of touring the Disaster Prevention Science Education Center, colleagues can understand safety and health measures that are implemented by government agencies, and gradually establish safety and health awareness and labor safety awareness among colleagues in all plants.

2. Field tours of labor occupational health students: CPT held 2 field tours for 67 labor occupational health students as part of practical training in 2011. Occupational safety and health and health care experiences are shared through instructors.

3. Occupational safety and health guidance program for small and medium-sized enterprises (the “Taking Root” Project): the company’s safety and health management personnel continue to participate in assisting the second year of the “Taking Root Project” executed by Taoyuan County Government, which is intended to assist medium and small enterprises on health

and safety issues. To increase local labor safety and disaster prevention capacities, experience sharing and cooperative exchange models are utilized through the “CPT Safety and Health Family” program to facilitate experience sharing and cooperation with “large enterprises leading small enterprises.” We hope to improve occupational safety and health of medium to small enterprises and increase the level of independent management.

4. Safety and Health Assistance Service, Northern Region Inspection Office of the Council of Labor Affairs: Convening regular contractor negotiation meetings to share CPT’s experience in promoting occupational safety and health with contractors and at the same time requiring contractors to adopt the relevant preventive measures to ensure work safety. The company also selects a few suppliers to offer them on-site assistance, suggestions for areas of improvement and requesting them to thoroughly implement management of occupational safety and health at their production plants. Total numbers of enterprises assisted by the safety and health assistance station in 2011 are 45.

Contractor: Fu-Yong Xu(Longtan Plant), Zhe-Yu Lin(Bade Plant), On-Site Senior Engineers from Jiulian Environmental Development Co., Ltd.

We are happy to share our safety and health management experience. “CPT Safety and Health Family” has successfully helped many medium to small enterprises.

Fu-Yong Xu (Longtan Plant)

Zhe-Yu Lin (Bade Plant)

We have been working with electrical wiring-related engineering from the first plant in Bade to the Longtan plant. By now, we have a long history of working with CPT, and we know each other well as engineering partners. CPT demonstrates considerable scope in terms of overall management systems, especially in the environmental protection field. We have understood the importance of safety, health, and construction management, which further reduced incidences of industrial safety accidents and achieved zero hazards. CPT is a company with a long history and in recent years has invested in production machinery to increase new manufacturing processes that yielded considerable results in terms of production. Construction contractors also regard CPT highly. Therefore, we are immensely honored to be working under CPT’s comprehensive management system. We also hope that, in the future, we can receive higher levels of engineering techniques and safety management education to better enable us to provide the perfect quality of engineering to CPT.


Training and Attracting Talents

CPT’s principle of education is based on the principle of learning and development, which creates human “capital” with human “resources.” Education training plans are based on company strategies as comprehensive growth environments are established. Major promotional projects and five key curriculums are formulated to assist the company in achieving performance objectives and increase employee capabilities.

Educational Training CurriculumAs corporate cultures are reformed and external

environments changed, educational training will further infuse multifaceted training continuously as part of corporate core values to develop the code of conduct of CPT personnel and jointly create innovate and grow. At the same time, accountability, understanding accountability, committing to accountability, and appreciating accountability as part of core values are also utilized. A 3 year plan is utilized to allow colleagues to understand the company’s “spirit of accountability” and foster “accountable” work ethics. Major project developments are also incorporated to award outstanding actions of accountability, shape the DNA of CPT personnel, and enhance accountable actions. The five key curriculums of CPT education:

1. New employee cur r icu lum: t ra in ing to ass is t new employees with rapidly understanding work environments and corporate culture.

2. Professional curriculum: training that assists employees with developing aptitude for professionalism and legal compliance, consolidating the professionalism of individual employees.

3. Management curr iculum: t ra in ing that assists managers with increasing management and leadership capabilities.

4. Group curriculum: assists employees with establishing proper attitude and group consensus towards work and rapidly responding to client needs to achieve objectives through communication, cooperation, and interdisciplinary and interdepartmental applications.

5. Self development curriculum: training that assists employees with developing linguistic and secondary specializations.

Comprehensive Learning PathsCPT conducts strategic planning workshops each year to

produce corporate level strategies, which will be subsequently extended to all responsible units. Learning and development is intended to assist with the achievement of corporate level strategies, and major indicator-based training is indoctrinated accordingly, such as indoctrination of accountability culture, opto-electronics forums for integrated R&D / product / manufacturing processes, personnel development, etc.

In 2011, educational training results in Taiwanese plants include a total of 1,481 classes held, with a total of 183,361 persons participating.

Every CPT employee can access abundant learning resources through multiple venues, including practical training, work shift rotations, online learning, field trip opportunities, etc. in particular, online learning systems are tailored to the professional needs of employees, providing abundant training classes. In 2011, a total of 171 online learning classes were provided, and a total of 137,621 persons were trained on topics ranging from R&D, management, manufacturing processes, environmental protection, computers, quality, legal issues, etc.. A total of more than 140,000 hours of training classes were also accumulated.

Employee Performance AppraisalAll employees of CPT receive periodic appraisals of

their occupational competency and development. Employees of CPT’s Taiwan production plants receive two performance appraisals each year, while those in our China operations receive four annually. Each supervisor rate the performance of an employee in accordance with the accomplishment of set targets and tasks, self-development, and actual behavior benchmarks. Supervisors also issue a follow-up interview notice to anyone who requires improvement to keep track of the status of improvement. The results of improvements are included in the next quarterly report for submission to higher management levels. The Human Resources Dept. determines an employee’s entitlement to salary increase or promotion on the basis of performance review standards.

We are pleased to announce that an electronic performance appraisal process has been established and all supervisors can now complete the appraisals in the online e-performance appraisal system. The system has reduced the time and resources required to complete the performance appraisal process.

Average Training Hour Per Employee for 2011 (hour/person)

CPT Taiwan CPT China

Technician 22.49(M:25.01F:19.46)

15.9(M:16.42F:15.18)

Engineer/Deputy

Engineer

43.82(M:42.98F:46.6)

24.67(M:26.58F:19.78)

Supervisor 55.02(M:54.8F:55.84)

13.11(M:11.44F:15.68)

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Caring for Employees

CPT’s emphasis on employees is reflected in the obstacle-free communication channels provided to all employees. This is the role and responsibility of CPT as a global citizen. CPT’s Taiwanese plants also work with Hsinchu’s Lifeline to provide legally related inquiries and assist employees with clarifying any legal concerns.

Multiple Channels for Employee Communication

CPT has established numerous internal dialogue exchanges such as the employee welfare committee, the employee union representing employees of our Taoyuan Production Plant and regular union meetings and conferences. CPT spares no effort on promoting and protecting employee rights. Our employees possess rights that exceed legal regulations and most other companies.

All levels of seminars are intended to proactively understand employee advice for the company and directions of improvements, instantly answer questions, and increase overall operational efficiency. Communication meetings for current operational conditions are held to convey the company’s business conditions and operational directions to facilitate consistency, transparency, timeliness, and accuracy of the delivery of company information. In 2011, CPT’s online mailboxes from Taiwanese plants accumulated 475 mails, assisting employees with responding to and resolving issues.

EAPsCPT has put in place the EAPs to offer free consultation

services to employees on a variety of issues including work pressure, family and parenting, life and law, labor relations, gender relationships, and financial related topics. We care about the well being of each employee with our heart. The company offered several legal courses that were in higher demand by our employees during 2011. We recruited professional lecturers to run the course on site to help more employees.

The Minimum Period of Notice for Change of Employment Conditions

To protect the employment rights of all employees, CPT abides by government legislations, and includes clear allowance for minimum periods of notice for change of employment conditions in its employment contract. When major changes occur to company operations which may affect labor rights, notice will be served 10 days beforehand to employees who have worked for CPT for three months to one year. Notice will be served 20 days beforehand to employees who have worked for CPT for one to two years. Notice will be served 30 days beforehand to employees who have worked for CPT for 3 years or longer.

Employee Pension FundCPT has put in place a comprehensive employee pension

policy. We make a monthly provision for pension fund in accordance with local regulations. prevailing in the country in which our offshore production plants operate, to ensure that each employee is well looked after upon retirement.

● Taiwan: Since the promulgation of the “Labor Pension Act” on July 1, 2005, CPT applies the legislation to new employees or employees who qualify for conditions of this legislation. An employee is required to make a monthly contribution equaling to 6% of his or her monthly salaries for depositing into his or her individual pension account held at the Bureau of Labor Insurance. As at December 31, 2011, CPT’s pension fund reserve deposited at the special pension fund account amounted to $254 million, while vested benefits obligations amounted to $325 million.

● Offshore invested companies: According to local regulations, contributions to the pension fund account shall be expensed in the current period of income.

Employee Communication Channels

Region Communication Channel

Party to the Communication Frequency

Taiwan

Survey on friendliness of the organization All employees Once /2-3 years

Information session to explain the current business

statusAll employees Twice / year

Supervisor conference Supervisors Twice/ year

Staff conference Non-executive employees Twice / year

Human resources news All employees Once /2 weeks

CPT news All employees Once/ month

Instant news All employees Once/ month

EIP home page All employees Non-periodic

On-line employee suggestion box All employees From time to time

China

Human resources communication meeting All employees Non-periodic

Feedbacks for comments given in performance review

(employees are free to offer any comments, which will be compiled by HR for

further handling)

All employees Once/ quarterly

Employee Relations Office All employees From time to time

President’s Mailbox , HR Mailbox All employees From time to time

EIP/OA home page All employees From time to time

CPT in Yung City & CPT Family News All employees Once / quarter

Employee satisfaction survey

Parties to the Communication Once / year

Business management conference All employees Non-periodic

Work with Employees to Care for Neighboring Community and Establish Green ImageCPT cares about society, and incorporates employee participation in social charities and local community events to contribute to community development and harmony. CPT also actively promotes environmental education. Internally, CPT develops green lifestyle concepts among employees and promotes the importance of environmental education, maintenance, and management. Externally, CPT promotes community culture, environmental protection, and natural ecological protection to create healthy and environmental community lifestyles and facilitate cultural inheritance, so that CPT, its employees, and communities can all grow together in order to fulfill our corporate social responsibilities.


Management of Charitable

Activities

In 2011, CPT undertook major corporate social responsibilities, providing 1,100 employment opportunities in Taiwanese plants, and also intensifying promotion of local culture and compassionate care, as well as providing emergency care for poor people in certain communities.

Promote Employment Opportunities for the Physically Impaired

CPT is committed to employment opportunities for disadvantaged minorities. In 2011, CPT provided 22 jobs for handicapped individuals, and introduced 14 visually impaired message therapists as full time employees, who provide services in “massage stations” in all plants. Providing a free stress-relieving massage after a busy day of work not only helps maintain the physical and mental health of employees and generate high acclaim, they can also utilize their skills and increase employment opportunities for handicapped people.

Corporate Volunteer ClubCPT’s corporate volunteer club is thriving. Our corporate

volunteers often use their spare time to volunteer at the various locations of Genesis Social Welfare Foundation, orphanages, and different educate centers to help the disadvantaged groups. The corporate volunteer club organized 28 events and provided 3,353 services during 2011. Our corporate volunteers share the mutual passion of helping the disadvantaged groups learn to live independently and support each other to rediscover their life ambitions.

Emergency ReliefCPT regards fulfilment of community care as its priority

mission as it joins in the pulse of local communities. At the same time, CPT is further committed to increasing the living functions of community residents. On top of sponsoring weddings and funerals, CPT is further actively committed to emergency relief for poor families. CPT never falls behind on compassion, and truly achieves the humanitarian spirit of “I hunger if another hungers.”

CPT Wins 5 Consecutive Healthy Enterprise Award 1000-People Run CPT passionately participates in the “2011 Fubon Taipei Marathon” event. Since 2007, a total of 6,008 marathon enthusiast colleagues and their family members have participated in the Taipei marathon event. This year, a total of 1,705 people participated. CPT had won the “Healthy Enterprise Award” for 5 years consecutively. Since 2009, CPT began sponsoring participation from visually impaired contestants. In 2011, CPT also financed the application fees of 27 visually impaired people who loved running, inviting them to join CPT’s ranks of runners and fulfilling its corporate social responsibilities.

Visually impaired message therapists were introduced in 2011, and “massage stations” are established in all plants.

Colleagues from the Corporate Volunteer Club provide care to seniors in the Sanhe community.

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Donation of Resources & SuppliesSince 2010, CPT initiated the “Let’s All Recycle” event,

which received enthusiastic response. During the event, colleagues from all plants are educated and encouraged to recycle obsolete cell phones, CDs, batteries, toners, printers, ink cartridges, computers, and other equipments, which not only reduces production of waste materials, but also serves charitable causes. In 2011, CPT continued to receive assistance from high level managers and the Information Division. On top of gathering obsolete IT items from the Taoyuan plant, the recycling drive was extended to Yangmei plant as well in 2011. All gathered recycled items were donated to the “Development Center for the Spinal Cord Injured” and “Syin-Lu Social Welfare Foundation” to make the best use of obsolete electronic products, and also further fulfill our pledge of environmental protection. CPT will continue to educate our colleagues on cherishing the earth’s resources, encourage our colleagues to turn unused items in our lives into charitable donations, harness everyone’s capabilities to lend a helping hand to disadvantaged groups, avoid turning material resources into waste materials, continue engaging in environmental and charitable acts, and fulfill our corporate social responsibilities.

Book Sharing EventIn 2011, an exchange platform was established through

the Book Sharing Event held by the library to allow colleagues to reuse their book resources and spread the love for books so that their cherished book resources can be shared and reused again. In 2012, CPT will further implement the “Book Donation Charity – Share Your Cherished Books” event, where the company’s community groups will turn books donated from our colleagues to groups in need of help, so that our colleagues can do their part of the Earth’s environment in addition to donating books for charitable causes.

Community Resident: Hai-Ying Chen, Wujiang Plant

I f i r s t f o u n d o u t about CPT Display Technology in 2001, when the plant was in the initial stages o f c o n s t r u c t i o n . O u r v i l l a g e w a s surrounded by farms at that time, and CPT Display Technology’s p l a n t g a v e n e w c h a n g e s t o o u r lives, from road and bridge infrastructure c o n s t r u c t i o n t o s u b s e q u e n t b u s

routes. Unprecedented changes occurred in our lives.We all heard that electronics plants have pollution and radiation issues, and we have a major river – Yaogang River – just south of CPT’s plant. So we started worrying about whether our drinking water and vegetable plantations would be polluted after the plant is built!As CPT opened for business, some nearby villagers started working for CPT, and gradually understood that their plants and facilities are all approved by layers of government agencies. Our most vital concern was wastewater outflow, and we learned that it is released universally to the open wastewater treatment plant. Then, our concerns were gradually resolved. Now we understand that CPT is an ethical corporation. Over these years, we have gotten along well with CPT, who added tap water to our village’s small temple, and every year they would come by the town’s seniors’ home to care for lonely seniors, etc. we hope to see more law-abiding and compassionate corporations like them invest in our town.

Turning obsolete electronic products into compassion creates win-win solutions for the environment and disadvantaged groups


Main CSR Events

CPT creates a joyful working environment, and regularly holds health promotion and safety and health events, as well as environmentally related events, such as: green exhibits, CPT Family Day, summer camps for children, etc. By combining methods such as seminars, competitions, or dynamic activities with relevant topics, our colleagues, family members, children from nearby elementary schools, and community residents can deeply understand CPT’s commitment to CSR.

Green ExpoIn 2011, the “Green Expo” event of CPT’s Taiwanese

plants, grounded on the event slogan of “Green and Joyful Celebration on CPT’s 40th Anniversary,” began on April 22, a date selected specifically because it was World Earth Day, symbolizing CPT’s Green Expo echoing an international day and connecting with international events. In 2011, the event not only invited colleagues from all plants, certain activities were also opened to nearby companies, such as: Toppan, Giantplus, Synchronic, as well as community residents, demonstrating the company’s commitment to fulfilling CSR.

In the opening ceremony of the Green Expo in 2011, Deputy Secretary General of the Taiwan Environmental Information Center was invited to share his experience on “compassionate care for Earth” for World Earth Day and environmental activities, as well as leading high level managers in signing the pledge for green actions.

On the day of the closing ceremony, a health and safety conference was held for high level managers. The President led high level managers to read the “occupational safety and health declaration.”

Children’s Summer CampCPT not only takes care of its colleagues, but also their

family members. Every July, children of CPT employees are given the most special summer gift, the children’s summer camp. In the summer of 2011, we spent a night at the Kenting marine museum to experience marine ecology and explore. We hope that the summer camps can educate future generations on the concepts and importance of ecological protection, enabling children to understand the limits of our resources and that they are only sustainable through protection.

“CPT Turns 40 – It’s Good to See You” Series of Events

2011 is the 40th anniversary of CPT, and the celebration is expanded to include the 40-year CPT artifacts exhibit, performance arts, and relevant series of events. The CPT online museum is also established for the perusal of our colleagues in order to attain an in-depth understanding of CPT’s historical culture and view the results of relevant activities.

CPT Family Day was passionately held in front of the plaza of the HSR Taoyuan station, which also, for the first time, extended the event to night time, where fireworks were held as our colleagues enjoyed the event. On the day of the event, Chairman Wei-Shan Lin rallied all CPT colleagues and their family members to join hands care for Earth and embrace nature. CPT Family Day not only represents the company in fulfilling our focus on employee well being and family values but also included an event to exchange obsolete cell phones for environmental picnic cloth. 5 public charity organizations were also invited that day to participate in the charity tour event. All proceeds were donated to charity.

Spending the night at Kenting marine museum

The President reads the “occupational safety and health declaration” to create a joyful and safe working environment.

Green and Joyful Celebration on CPT’s 40th Anniversary

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永續性議題管理

節省能資源耗用、開發對環境友善產品

提供優質綠色產品、爭取客戶認同

鼓勵廠商綠色經營、提供綠色服務

建立健康樂活工作環境

落實自主環保

結合員工關懷社區、建立綠色形象

公司概況

Ruguo Children’s Theatrical Group – Song of the Wandering Dog performance arts event

40th anniversary historical artifacts tour

Exchanging obsolete cell phones for picnic cloths during CPT Family Day

Fireworks during the closing ceremony of CPT Family Day

5 public charity groups jointly present gratuitous statements to CPT


Integration into Local

Communities

CPT upholds its obligations as a social citizen, and spares no effort in promoting community care. CPT frequently encourages its personnel to care for those around them that are in need of help to fulfill our social responsibilities, and actively invest money and labor to give back to local communities.

Participation in Community Charity EventsIn 2011, CPT actively invested in charitable events

for local temples / schools / various indicator groups, and elevated the humane quality of communities by upholding the action principle of “I hunger if another hungers” and sponsoring activities such as charitable events, environmental awareness campaigns, traditional local festivals, etc. CPT also combined police and fire agencies around all plant areas with civil defense groups of townships. Not only are major safety exercises and fire safety seminars held each year, community patrols are further provided with various vehicles and subsidies on repairs and fuel costs to consolidate safety concepts among local populations and enhance law enforcement mechanisms for townships.

CPT’s accomplishments come from support from all local communities. Therefore, CPT makes considerable investments to sponsor community events of nearby townships and major celebration events, sponsorship of community parks, nearby road maintenance and cleaning, etc., thus truly fulfilling the principle of “take from communities and use on communities” and fulfilling the obligation of being a good neighbor.

Support Community Environmental EventsIn November 2010, the Business Council for Sustainable

Development (BCSD) initiated the “Healthy, Low Carbon, and Joyful Lifestyles – Let’s All Work Together 1 at a Time,” promoting changes to our lifestyles and consumer behavior one person, one action, and one small step at a time. CPT had never been absent from participation in green events. In 2010, CPT initiated 1 red meat-free day per month, which was further enhanced to 1 red meat-free day every two weeks in 2011. In 2011, the BCSD held a tree planting event in the HSR Taoyuan station on November 10 to respond to the government’s forestry plan and at the same time echo the call of “International Forest Year” and extend the spirit of “1 at a Time,” demonstrating its care for Earth with the simplest and most practical methods. CPT continues to echo the “1 at a Time” event as it rallies its colleagues to plant their own trees and turn their commitment to the spirit of “1 at a Time” into action in daily life.

Other environmental activities that support communities include:

1. With “Care for Our Environment” as the topic, colleagues from the Taoyuan plant provided education to the environmental volunteer team of Danan Township on categorical waste recycling concepts, with focus on education on detailed waste resource classification principles, so that environmental volunteers can further understand references over which waste materials are classified. Alos, electricity consumption and CO2 emissions from the use of various electrical equipments in daily life are also explained.

2. The Taoyuan plant had sponsored the flower garden of Daan Elementary School, maintenance of the community park of Danan Township, maintenance of the flower garden of 411th Lane of Heping Road, and sponsorship maintenance of Heping Road.

3. The Yangmei plant donated subsidies for uniform costs of environmental volunteers of Meixin Township, Yangmei City, as well as sponsoring road maintenance for Xingshan Road, which is close to the plant.

Other than supporting community environmental events, CPT continues to invest in landscaping for plant areas in hopes of creating an atmosphere of an environmental plant, and allowing colleagues and community residents to relax as they stroll in the gardens. After the green garden was successfully renovated in the Taoyuan plant, the Longtan plant also used its idle space to renovate and add more vegetation coverage in 2011, such as green walls, landscaping, and ecological ponds.

Contribution of CPT (Taiwan) to Community Events

Total Amount: NT$ 390,410

Other community events:21%

Traditional festive events19%

C o m m u n i t y Security55%

Environment & Eco logy/ Promotion of Education5%

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Emergency ReliefCPT’s charitable projects in China mostly focused on

providing financial assistance to those in need and disaster relief to disaster-stricken areas. Primary events for all plant areas in 2011 include:● Chunghwa Picture Tubes (Wujiang) Ltd.1. Plant charity sale: in the 10th anniversary celebration, the

Corporate Volunteer Club donated coffee and second hand clothing. Proceeds were donated to the compassionate fund, which will help many people.

2. Subsidy for poor students in Aixin School: to help outstanding students in Aixin School of Wujiang City graduate, management subsidies, donations from colleagues, and the compassionate fund were used to help 20 students successfully graduate.

3. Fulfill 100 wishes in Aixin School: poor children cannot afford to buy supplies needed for school. Aixin school initiated the “100-children, 100-wish” event. Under diligent rallying of our colleagues and managers, CPT successfully delivered the wish list of the poor children.

●CPT Display Technology (Shenzheng) Ltd.1. Same sun, same warmth: donation of 1,000 articles of

clothing / blankets to elementary schools in poverty-stricken mountain regions of Nujiang, Yunnan.

2. A colleague contracted edema, and could not afford the high costs of required surgeries. The Corporate Volunteer Club donated $RMB 2,000 to finance the surgeries and helped the colleague recover to health.

●CPT Display Technology (Fujian) Ltd.1. Spring and fall tuition assistance: CPT visited struggling

students in Pingtan and Yongtai, sponsoring 32 elementary school students and issuing tuition assistance, gifts, etc..

2. Donated $RMB 200,000 to the charity organization of Mawei region, as well as establishing CPT’s own charity branch.

●CPT TPV Optical (Fujian) Co., Ltd.1. Charity event for Fuqing City Orphanage: on April 28, CPT

held a charity event for Fuqing City Orphanage, where corporate club representatives presented foot items to 26 orphans, as well as caring for and encouraging them.

2. School assistance for elementary schools in remote villages in Fuqing City: on October 28, CPT held a school assistance event in Dongshan Elementary School in Fuqing City (a remote and poverty-stricken mountain village elementary school), presenting 59 outstanding students with school supplies and sports apparel.

Contribution of CPT (China) to Community Events

Total amount: $RMB 473,247.8

Benefit services1%

Emergency poverty relief 10%

Social benefit donation80%

Education9%

NGO: Red Cross

Chunghwa Picture Tubes (Wujiang) Ltd. had won many titles from Wujiang City, such as top 100 corporations, organizations with advanced cultures, etc. They are a major corporation being developed by the government of Wujiang City. In recent years, they have become very close to the Red Cross. From the May 12th Wenchuan earthquakes to the April 14th Yushu earthquake in Qinghai, and the continuation of school assistance, etc., all of CPT Visual Information Wujiang’s entire leadership andemployees have responded to the call of the nation and actively engaged in events such as donation drives, charity sales, etc., to fulfill their social responsibilities.Every year, CPT would invite us to provide training such as CPR, disease prevention, etc., for their employees, to increase safety and health knowledge of all CPT employees. Hopefully, such policies will be continued.

CPT donates cash and supplies to address the needs of poverty-stricken students

CPT continues to invest in poverty relief for remote rural communities as it delivers its compassion to the Fuqing Orphanage.

GP5008 Issue 2

SGS TAIWAN’S REPORT ON SUSTAINABILITY ACTIVITIES IN THE CHUNGHWA PICTURE TUBES, LTD.’s CORPORATE SOCIAL RESPONSIBILITYREPORT FOR 2011

NATURE AND SCOPE THE ASSURANCE/VERIFICATIONSGS Taiwan was commissioned by Chung Hwa Picture Tubes, Ltd. to conduct an independent assurance ofthe Corporate Social Responsibility Report of 2011. The scope of the assurance, based on the SGSSustainability Report Assurance methodology, included the text, and data in accompanying tables, contained infactories in Taiwan and China of this report.

The information in the Corporate Social Responsibility Report of 2011 of Chung Hwa Picture Tubes, Ltd. and itspresentation are the responsibility of the superintendent, vice superintendents, CSR committee and themanagement of Chung Hwa Picture Tubes, Ltd. SGS Taiwan has not been involved in the preparation of any ofthe material included in the Corporate Social Responsibility Report of 2011. Our responsibility is to express anopinion on the text, data, graphs and statements within the scope of verification set out below with the intentionto inform all Chung Hwa Picture Tubes, Ltd.’s stakeholders.

The SGS Group has developed a set of protocols for the Assurance of Sustainability Reports based on currentbest practice guidance provided in the Global Reporting Initiative Sustainability Reporting Guidelines (2011) andthe AA1000 Assurance Standard (2008). These protocols follow differing options for Assurance depending thereporting history and capabilities of the Reporting Organisation.

This report has been assured at Global Reporting Initiative G3.1 Application level A+ and AA1000 AssuranceStandard (2008) type 1, high level of scrutiny using our protocols for:

evaluation of content veracity; evaluation of the report content and supporting management systems against the AA1000

Accountability Principles (2008); and evaluation of the report against the Global Reporting Initiative Sustainability Reporting Guidelines

(G3.1 2011).

The assurance comprised a combination of pre-assurance research, interviews with relevant employees atheadquarter of Chung Hwa Picture Tubes in Bade City, Taoyuan County, Taiwan; documentation and recordreview and validation with external bodies and/or stakeholders where relevant. Financial data drawn directlyfrom independently audited financial accounts has not been checked back to source as part of this assuranceprocess.

STATEMENT OF INDEPENDENCE AND COMPETENCEThe SGS Group of companies is the world leader in inspection, testing and verification, operating in more than140 countries and providing services including management systems and service certification; quality,environmental, social and ethical auditing and training; environmental, social and sustainability report assurance.SGS Taiwan affirms our independence from Chung Hwa Picture Tubes, Ltd., being free from bias and conflictsof interest with the organisation, its subsidiaries and stakeholders.

The assurance team was assembled based on their knowledge, experience and qualifications for this assignment,and comprised auditors registered with QMS, EMS, SMS, EnMS, GPMS, SA 8000, GHG Verification LeadAuditors and experience on the SRA Assurance service provisions.

ASSURANCE STATEMENT

VERIFICATION/ ASSURANCE OPINIONOn the basis of the methodology described and the verification work performed, we are satisfied that theinformation and data contained within CSR Report of 2011 verified is accurate, reliable and provides a fair andbalanced representation of Chung Hwa Picture Tubes, Ltd. sustainability activities from 01/01/2011 to12/31/2011. Some statements and data within the scope were not assured due to lack of accessible recordsduring the timescale allowed for assurance, and these are clearly marked throughout the text.

The assurance team is of the opinion that the Report can be used by the Reporting Organisation’s Stakeholders.We believe that the organisation has chosen an appropriate level of assurance for this stage in their reporting.The report is the third to be assured by an independent assurance team and Chung Hwa Picture Tubes, Ltd.has taken a bold step by offering the report to evaluation against both GRI’s G3.1 guidelines and the AA1000Assurance standard. This shows a deserved confidence in their reporting process. In our opinion, the contentsof the report meet the requirements of GRI G3.1 Application Level A+ and AA1000 Assurance Standard (2008)type 1, high level.

AA1000 ACCOUNTABILITY PRINCIPLES (2008) CONCULSIONS, FINDINGS AND RECOMMENDATIONSInclusivityChung Hwa Picture Tubes, Ltd. has demonstrated a strong commitment to stakeholder inclusivity. A variety ofengagement efforts underpin the organisation's understanding of stakeholder concerns, and its ability tointegrate them into its decision making processes. This is demonstrated by the surveys of staff, consumers andsuppliers, and also by engagements with other stakeholders. For future reporting, Chung Hwa Picture Tubes,Ltd. may consider further widening the scope of engagement and establishing ways for stakeholders to bedirectly involved in decisions which will improve sustainability performance.MaterialityChung Hwa Picture Tubes, Ltd. has established effective processes for determining issues that are material tothe business. Formal review has identified stakeholders and those issues that are material to each group andthe report addresses these at an appropriate level to reflect their importance and priority to these stakeholders.It is recommended that process and criteria to determining materiality may be formally documented forconsistency. In addition, Chung Hwa Picture Tubes, Ltd. may consider developing a means of addressingconflicts or dilemmas between different expectations regarding materiality.ResponsivenessThe report includes coverage given to stakeholder engagement and channels for stakeholder feedback. It isrecommended to further respond on conflicts or dilemmas for better balance of responsiveness.

GLOBAL REPORTING INITIATIVE REPORTING GUIDELINES (2011) CONCULSIONS, FINDINGS ANDRECOMMENDATIONSPrinciples, Standard Disclosures and IndicatorsThe report is adequately in line with the GRI G3.1 Application level A+. The principle of balance and disclosureon management approach may be further enhanced in next report. Some performance indicators which werepartially addressed in this report may be further strengthened in future reporting.

Signed:For and on behalf of SGS Taiwan Ltd.

Dennis Yang, Chief Operating Officer25th July, 2012

WWW.SGS.COM


GRI G3.1 IndexDisclosure Items CPT’s Responses Page

Profile

1.1 Statement from the most senior decision maker of the organization about the relevance of sustainability to the organization and its strategy. Letter from the Chairman 2

1.2 Description of key impacts, risks, and opportunities. Risk Management 18

2.1 Name of the organization. Chunghwa Picture Tubes, Ltd. --

2.2 Primary brands, products, and/or services. Our Products 10

2.3 Operational structure of the organization, including main divisions, operating companies, subsidiaries, and joint ventures. Organizational Structure of CPT 14

2.4 Location of organization’s headquarters. No.1127, Heping Rd., Bade City, Taoyuan, Taiwan --

2.5 Number of countries where the organization operates, and names of countries with either major operations or that are specifically relevant to the sustainability issues covered in the report. Global Deployment 11

2.6 Nature of ownership and legal form. Shareholder Composition 11

2.7 Markets served. Global Deployment 11

2.8 Scale of the reporting organization. Company Profile 4

2.9 Significant changes during the reporting period regarding size, structure, or ownership. Editorial Policy 1

2.10 Awards received in the reporting period. Major Events and Awards Won 8,9

3.1 Reporting period for information provided. 2011.01.01~12.31 --

3.2 Date of most recent previous report. 2011.07 --

3.3 Reporting cycle. Yearly --

3.4 Contact point for questions regarding the report or its contents. Editorial Policy 1

3.5 Process for defining report content. Identification of Key Issues 17

3.6 Boundary of the report. Editorial Policy 1

3.7 State any specific limitations on the scope or boundary of the report. Editorial Policy 1

3.8 Basis for reporting on joint ventures, subsidiaries, leased facilities, outsourced operations, and other entities that can significantly affect comparability from period to period and/or between organizations. Editorial Policy 1

3.9 Data measurement techniques and the bases of calculations, including assumptions and techniques underlying estimations applied to the compilation of the Indicators and other information in the report. According to each indicators 50

3.10 Explanation of the effect of any re-statements of information provided in earlier reports, and the reasons for such re-statement. No Such Case --

3.11 Significant changes from previous reporting periods in the scope, boundary, or measurement methods applied in the report.

CPT (Malaysia) Co., Ltd (including the Malaysia plant and the Kampar plant in Malaysia) was sold in January 28, 2011. Therefore, the disclosure report in 2011 does not include plants in the Malaysia region.

1

3.12 Table identifying the location of the Standard Disclosures in the report. GRI G3.1 Index 70

3.13 Policy and current practice with regard to seeking external assurance for the report. Assurance Statement 68

4.1 Governance structure of the organization, including committees under the highest governance body responsible for specific tasks, such as setting strategy or organizational oversight. Operation of Board of Directors 14

4.2 Indicate whether the Chair of the highest governance body is also an executive officer. Yes --

4.3 For organizations that have a unitary board structure, state the number of members of the highest governance body that are independent and/or non-executive members. Operation of Board of Directors 14

4.4 Mechanisms for shareholders and employees to provide recommendations or direction to the highest governance body.

Disclosure of Financial Information and Communication with Investors 15

4.5 Linkage between compensation for members of the highest governance body, senior managers, and executives, and the organization’s performance. Operation of Board of Directors 14

4.6 Processes in place for the highest governance body to ensure conflicts of interest are avoided. Operation of Board of Directors 14

4.7 Process for determining the qualifications and expertise of the members of the highest governance body for guiding the organization’s strategy on economic, environmental, and social topics. Green Management Committee 16

4.8 Internally developed statements of mission or values, codes of conduct, and principles relevant to economic, environmental, and social performance and the status of their implementation. Management Philosophy, Code of Conduct 6,15

4.9Procedures of the highest governance body for overseeing the organization’s identification and management of economic, environmental, and social performance, including relevant risks and opportunities, and adherence or compliance with internationally agreed standards, codes of conduct, and principles.

Green Management Committee 16

4.10 Processes for evaluating the highest governance body’s own performance, particularly with respect to economic, environmental, and social performance. Green Management Committee 16

4.11 Explanation of whether and how the precautionary approach or principle is addressed by the organization. Env i ronmenta l R isk Assessment and Communication 30

4.12 Externally developed economic, environmental, and social charters, principles, or other initiatives to which the organization subscribes or endorses. TTLA, EICC 25,46

4.13 Memberships in associations and/or national/international advocacy organizations. TTLA, EICC 25,46

4.14 List of stakeholder groups engaged by the organization. Stakeholder Engagement 17

4.15 Basis for identification and selection of stakeholders with whom to engage. Stakeholder Engagement 17

4.16 Approaches to stakeholder engagement, including frequency of engagement by type and by stakeholder group. Stakeholder Engagement 17

4.17 Key topics and concerns that have been raised through stakeholder engagement, and how the organization has responded to those key topics and concerns, including through its reporting. Stakeholder Engagement 17

Economic Disclosure on Management Approach Corporate Governance 14

EC1Direct economic value generated and distributed, including revenues, operating costs, employee compensation, donations and other community investments, retained earnings, and payments to capital providers and governments.

Financial Highlights 11

EC2 Financial implications and other risks and opportunities for the organization’s activities due to climate change. Risks of Climate Change 18

EC3 Coverage of the organization’s defined benefit plan obligations. Employee Pension Fund 59

EC4 Significant financial assistance received from government. Financial Highlights 11

EC5 Range of ratios of standard entry level wage compared to local minimum wage at significant locations of operation. Implementation of the EICC 44

EC6 Policy, practices, and proportion of spending on locally-based suppliers at significant locations of operation. Ratios of Local Procurement 47

EC7 Procedures for local hiring and proportion of senior management hired from the local community at locations of significant operation. Global Employee Analysis 50

EC8 Development and impact of infrastructure investments and services provided primarily for public benefit through commercial, in-kind, or pro bono engagement. Integration into Local Communities 66

Environmental Disclosure on Management Approach Carbon Management, Water Resources Management 23,26

EN1 Materials used by weight or volume. Outline of Material Flow 29

EN2 Percentage of materials used that are recycled input materials. Resource Reduction and Reuse 32

EN3 Direct energy consumption by primary energy source. Outline of Material Flow 29

EN4 Indirect energy consumption by primary source. Outline of Material Flow 29

EN5 Energy saved due to conservation and efficiency improvements. Electricity Conservation Results and Summary 25

EN6 Initiatives to provide energy-efficient or renewable energy based products and services, and reductions in energy requirements as a result of these initiatives. Green Product Innovation Cases 38

EN7 Initiatives to reduce indirect energy consumption and reductions achieved. Resource Reduction and Reuse 32

EN8 Total water withdrawal by source. Water Resources Management 26

EN9 Water sources significantly affected by withdrawal of water. No Such Case --

EN10 Percentage and total volume of water recycled and reused. Water Resources Management 26

EN11 Location and size of land owned, leased, managed in, or adjacent to, protected areas and areas of high biodiversity value outside protected areas. All factories in industrial area --

EN12 Description of significant impacts of activities, products, and services on biodiversity in protected areas and areas of high biodiversity value outside protected areas.

Env i ronmenta l R isk Assessment and Communication 30

EN13 Habitats protected or restored. No Such Case --

EN14 Strategies, current actions, and future plans for managing impacts on biodiversity. No Such Case --

EN15 Number of IUCN Red List species and national conservation list species with habitats in areas affected by operations, by level of extinction risk. No Such Case --

EN16 Total direct and indirect greenhouse gas emissions by weight. Annual Greenhouse Gas Emission Trend 24

EN17 Other relevant indirect greenhouse gas emissions by weight. No 2011 statistics, plan for future disclosure --

EN18 Initiatives to reduce greenhouse gas emissions and reductions achieved. Greenhouse Gas Inventory, Low Carbon Corporate Action Plan 23

EN19 Emissions of ozone-depleting substances by weight. No filling of ozone-depleting substances --

EN20 NO, SO, and other significant air emissions by type and weight. Outline of Material Flow 29

EN21 Total water discharge by quality and destination. Outline of Material Flow 29

EN22 Total weight of waste by type and disposal method. Outline of Material Flow 29

EN23 Total number and volume of significant spills. No Such Case --

EN24 Weight of transported, imported, exported, or treated waste deemed hazardous under the terms of the Basel Convention Annex I, II, III, and VIII, and percentage of transported waste shipped internationally. 不不不 --

EN25 Identity, size, protected status, and biodiversity value of water bodies and related habitats significantly affected by the reporting organization’s discharges of water and runoff.

Env i ronmenta l R isk Assessment and Communication 31

EN26 Initiatives to mitigate environmental impacts of products and services, and extent of impact mitigation. Reduce Resource Consumpt ion and Implement Easy Recycle Design 38

EN27 Percentage of products sold and their packaging materials that are reclaimed by category. Reduce Resource Consumpt ion and Implement Easy Recycle Design 38

EN28 Monetary value of significant fines and total number of non-monetary sanctions for noncompliance with environmental laws and regulations. Environmental expenditure 31

EN29 Significant environmental impacts of transporting products and other goods and materials used for the organization’s operations, and transporting members of the workforce. No Such Case --

EN30 Total environmental protection expenditures and investments by type. Environmental Expenditure Statistics 31

Labor Practices and Decent Work Disclosure on Management Approach Protection of Human Rights 50

LA1 Total workforce by employment type, employment contract, and region. Global Employee Analysis 50

LA2 Total number and rate of employee turnover by age group, gender, and region. Global Employee Analysis 50

LA3 Benefits provided to full-time employees that are not provided to temporary or part-time employees, by major operations. Employee Welfare 52

LA4 Percentage of employees covered by collective bargaining agreements. Labor Unions & Labor Negotiations 51


LA5 Minimum notice period(s) regarding operational changes, including whether it is specified in collective agreements. The Minimum Period of Notice for Change of Employment Conditions 59

LA6 Percentage of total workforce represented in formal joint management- worker health and safety committees that help monitor and advise on occupational health and safety programs.

Environmental Safety and Heath Management System 54

LA7 Rates of injury, occupational diseases, lost days, and absenteeism, and number of work related fatalities by region. Safety and Health Performance 56

LA8 Education, training, counseling, prevention, and risk-control programs in place to assist workforce members, their families, or community members regarding serious diseases. Health Care 53

LA9 Health and safety topics covered in formal agreements with trade unions. Environmental Safety and Heath Management System 54

LA10 Average hours of training per year per employee by employee category. Educational Training Curriculum 58

LA11 Programs for skills management and lifelong learning that support the continued employability of employees and assist them in managing career endings. Training and Attracting Talents 58

LA12 Percentage of employees receiving regular performance and career development reviews. Training and Attracting Talents 58

LA13 Composition of governance bodies and breakdown of employees per category according to gender, age group, minority group membership, and other indicators of diversity. Global Employee Analysis 50

LA14 Ratio of basic salary of men to women by employee category. Global Employee Analysis 50

LA15 Return to work and retention rates after parental leave, by gender. Employee Welfare 52

Human Rights Disclosure on Management Approach Protection of Human Rights 50

HR1 Percentage and total number of significant investment agreements that include human rights clauses or that have undergone human rights screening. Compliance with EICC 51

HR2 Percentage of significant suppliers and contractors that have undergone screening on human rights and actions taken. Supplier Rating and Implementation 42

HR3 Total hours of employee training on policies and procedures concerning aspects of human rights that are relevant to operations, including the percentage of employees trained. Compliance with EICC 51

HR4 Total number of incidents of discrimination and actions taken. No discrimination case in 2011 --

HR5 Operations identified in which the right to exercise freedom of association and collective bargaining may be at significant risk, and actions taken to support these rights. Labor Unions & Labor Negotiations 51

HR6 Operations identified as having significant risk for incidents of child labor, and measures taken to contribute to the elimination of child labor. Compliance with EICC 51

HR7 Operations identified as having significant risk for incidents of forced or compulsory labor, and measures to contribute to the elimination of forced or compulsory labor. Compliance with EICC 51

HR8 Percentage of security personnel trained in the organization’s policies or procedures concerning aspects of human rights that are relevant to operations. Compliance with EICC 51

HR9 Total number of incidents of violations involving rights of indigenous people and actions taken. --

HR10 Percentage and total number of operations that have been subject to human rights reviews and/or impact assessments. Compliance with EICC 51

HR11 Number of grievances related to human rights filed, addressed, and resolved through formal grievance mechanisms. Compliance with EICC 51

Society Disclosure on Management Approach Corporate Governance 14

SO1 Nature, scope, and effectiveness of any programs and practices that assess and manage the impacts of operations on communities, including entering, operating, and exiting. Integration into Local Communities 66

SO2 Percentage and total number of business units analyzed for risks related to corruption. No 2011 statistics, plan for future disclosure --

SO3 Percentage of employees trained in organization’s anti-corruption policies and procedures. No 2011 statistics, plan for future disclosure --

SO4 Actions taken in response to incidents of corruption. Code of Conduct 15

SO5 Public policy positions and participation in public policy development and lobbying. No lobbying in 2011 --

SO6 Total value of financial and in-kind contributions to political parties, politicians, and related institutions by country. No Such Case --

SO7 Total number of legal actions for anticompetitive behavior, anti-trust, and monopoly practices and their outcomes. Fair Competition 19

SO8 Monetary value of significant fines and total number of non-monetary sanctions for noncompliance with laws and regulations. Fair Competition 19

SO9 Operations with significant potential or actual negative impacts on local communities. Continued Commitment to the Xiaoli River Incident 31

SO10 Prevention and mitigation measures implemented in operations with significant potential or actual negative impacts on local communities.

Continued Commitment to the Xiaoli River Incident 31

Product Responsibility Disclosure on Management Approach Innovative Materials and Technology R&D 37

PR1 Life cycle stages in which health and safety impacts of products and services are assessed for improvement, and percentage of significant products and services categories subject to such procedures. Carbon and Water Footprint Certifications 37

PR3 Type of product and service information required by procedures and percentage of significant products and services subject to such information requirements.

UL logo used on product, GP logo used on external packaging --

PR4 Total number of incidents of non-compliance with regulations and voluntary codes concerning product and service information and labeling, by type of outcomes. No non-compliance in 2011 --

PR5 Practices related to customer satisfaction, including results of surveys measuring customer satisfaction. Customer Relationship Management 36

PR6 Programs for adherence to laws, standards, and voluntary codes related to marketing communications, including advertising, promotion, and sponsorship. Not applicable --

PR7 Total number of incidents of non-compliance with regulations and voluntary codes concerning marketing communications, including advertising, promotion, and sponsorship by type of outcomes. No non-compliance in 2011 --

PR8 Total number of substantiated complaints regarding breaches of customer privacy and losses of customer data. No non-compliance in 2011 --

PR9 Monetary value of significant fines for noncompliance with laws and regulations concerning the provision and use of products and services. No non-compliance in 2011 --

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