Before conducting transactions, SYSTEX evaluates the legitimacy of the counterparty and checks it for a record of dishonest behavior. Adhering to the business philosophy of integrity, SYSTEX has formulated corporate governance and risk management mechanisms, and then implements them internally and externally. In order to implement ethical corporate governance and supply chain management, SYSTEX has required new suppliers to sign the “Vendor Integrity Pledge and Declaration” since 2019 to perform and maintain the development of business activities. A total of 2,652 suppliers have signed this document by 2023.

SYSTEX is committed to implementing social responsibility and protecting basic human rights, expecting all suppliers can adopt the same standards and fulfill CSR together. Therefore, SYSTEX has developed “Supplier CSR Code of Conduct” in line with its “Ethical Corporate Management Best Practice Principles”, which requires suppliers of SYSTEX and its affiliates to comply with the laws and regulations of the places where they conduct business activities. A total of 1,798 suppliers have signed by 2023.

In February every year, SYSTEX implements the “Excellent Supplier Assessment”, which takes the list of existing high-performance suppliers, the transaction volume, number of transactions, purchasing recommendations, and other criteria to determine the comparison list, and then grades the suppliers accordingly.

SYSTEX conducts annual assessments and then ranks suppliers accordingly. In 2023, a total of 20 suppliers were included in the list of qualified suppliers.
Note: The upstream software originals do not need to be assessed to be the qualifiers. Therefore, there are about 100 suppliers on the list.

Through the “Rules of Outsourced Project Management,” SYSTEX has established an outsourced supplier assessment team to newly select 31 suitable outsourced suppliers in 2023. After selection, SYSTEX will monitor and manage its outsourced suppliers and regularly report their records and status.

According to the annual transaction volume, number of transactions and other criteria, SYSTEX defines key suppliers from Distributors and Outsourcers, and selects 20-25 key suppliers to carry out the “Key Supplier ESG Assessment.” The assessment is oriented to 35 questions in 16 topics of ESG issues, and suppliers are required to provide explanations for each question. The audit team is formed by a dedicated procurement team and conducts online and on-site audits.

In 2023, a total of 20 suppliers participated in the ESG assessment, and their overall average scores reached the standard. The analysis revealed that suppliers primarily scored low in “Supplier Management,” “Management System,” and “GHG Emissions”. Therefore, SYSTEX offered them suggested solutions to facilitate improvement. If a supplier fails to meet the criteria, SYSTEX will inform the supplier of the results and recommendations, enabling the supplier to improve its performance.

SYSTEX’s outsourced suppliers are classified into 4 categories: manpower stationing, AP development, engineering construction, and information security outsourcing. SYSTEX has formulated the “Rules of Outsourced Project Management” to accelerate and facilitate outsourcing procurement efficiency. Therefore, SYSTEX conducts an “Outsourced Project Assessment” when the outsourced project closed. According to the service quality and cooperation of the supplier, SYSTEX grades them with A to E accordingly. SYSTEX will facilitate the procurement for level-A suppliers, avoid cooperation with level-D & E suppliers. As a result, 155 outsourced suppliers were evaluated in 2023, all receiving grade of level-C or above, of which 49 outsourced suppliers were level-A.

SYSTEX Group responds to the competent authority’s promotion of green procurement actions and increases the volume of green procurement. SYSTEX Corporation and its affiliated companies have received commendations from the Ministry of Environment and the Taipei City Government as exemplary green procurement organizations, aiding the government in creating a green and high-quality living environment.