Supplier Sustainability Management

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”, which requires suppliers of SYSTEX and its affiliates to comply with the laws and regulations of the places where they conduct business activities.

SYSTEX has 4 types of suppliers including Software Original, Affiliates, Distributors and Outsourcers. By 2021, a total of 1,525 suppliers have signed “Vendor Integrity Pledge and Declaration” (> 99% signed), and more than 500 suppliers have joined the “SYSTEX Partner APP”. Meanwhile, “Supplier CSR Code of Conduct” was officially adopted in April 2021, and a total of 615 suppliers signed documents, including 79 key suppliers (100% signed).

Every year, SYSTEX has conducted on-site audits on high-risk suppliers. Affected by the epidemic, SYSTEX replaced on-site audits with documentary audits and 22 key suppliers have passed the audits in 2021. In the future, 20 ~ 25 key suppliers will be audited every year to implement sustainable management policy. SYSTEX looks forward to working with suppliers to strengthen innovation and partnerships in the IT ecosystem.

Supplier Screening

SYSTEX positively influences suppliers through actual procurement actions. When screening new suppliers, we require them to sign “Supplier CSR Code of Conduct” and “Vendor Integrity Pledge and Declaration” in accordance with “Supplier Sustainability Management Process”. In addition to meeting the needs of project customers, we also consider suppliers’ service quality, sustainable development and integrity management, etc. Besides, SYSTEX conducts annual assessments based on the existing list of excellent suppliers or adds recommended suppliers to the list.

For suppliers who fail the assessment or are on the “Rejection List” published by the Public Construction Commission, SYSTEX classifies them as unqualified suppliers and terminates deals. If the supplier has a significant negative impact on the society, we will take the initiative to include it on unqualified list after verification. Unqualified suppliers have to go through the above process to resume transaction.

Supplier CSR Code of Conduct

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.

Vendor Integrity Pledge and Declaration

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 improve corporate governance and supply chain management, SYSTEX has required new suppliers to sign the “Vendor Integrity Pledge and Declaration” since 2019.

Assessment of Excellent Suppliers and on-Site Audit

Assessment of Excellent Suppliers

SYSTEX conducts annual assessments of excellent suppliers and then ranks them according to their performance of service quality, delivery, sustainable development and integrity management, etc. In 2021, the total number of excellent suppliers were 26. The score table is as follows:

Key Supplier ESG Assessment

Every year, SYSTEX defines key suppliers from Distributors and Outsourcers of suppliers based on criteria such as transaction volume or uniqueness, and then conducts ESG audit plans. The assessment questionnaire covers 16 topics and 35 questions. SYSTEX requires suppliers to answer each question and provide supporting materials to ensure that they have practical actions. Then the SYSTEX audit team conducts on-site audits irregularly to check the status of suppliers.

In 2021, SYSTEX conducted documentary audits due to the epidemic and 22 key suppliers passed the audit with an average score of 72.36. According to the analysis results, suppliers have low scores in “Management System, Supplier Management, Sustainable Disclosure, Greenhouse Gas (GHG)”, so that SYSTEX will assist suppliers to improve and reduce the potential risks.

Supplier ESG Promotion Plan

SYSTEX is expected to implement the “Supplier ESG Promotion Plan” in 2022, using digital technology to create a “supplier interactive platform”. Through the platform, SYSTEX can push information, confirm orders, reply to delivery, and organize online training of regulatory compliance and ESG promotion. SYSTEX is also expected to hold a “supplier exchange meeting” to invite excellent suppliers to share their practical experience. In addition, SYSTEX formulated the questionnaire of “Supplier Information Security and Personal Information Protection” at the end of 2021 and plans to require suppliers to conduct self-assessment in 2022, with the goal of more than 750 responses, hoping to raise suppliers’ awareness of IS protection and enhance their IS management.

“Supplier Information Security and Personal Information Protection” Questionnaire

The questionnaire is divided into 2 aspects, information security and personal information protection. In terms of information security, suppliers Innovate Interactive Management Tools are required to self-assess whether they have passed IS verification and built IS-related mechanisms. In terms of personal information protection, suppliers are required to check whether they have set up personal information-related mechanisms to implement improvement measures. In view of this, SYSTEX will continue to monitor the behavior of suppliers to implement information security.

[Digital Transformation] Respond Questionnaires through “SYSTEX Partner APP”

“SYSTEX Partner APP” is a partnership platform that shares procurement-related announcements, purchase order notices, receipt notices, payment notices and other information with suppliers, allowing suppliers to keep abreast of the latest information.

SYSTEX has developed the following functional services of “SYSTEX Partner APP”, so that suppliers can understand SYSTEX’s sustainable management policy, receive the latest ESG trends, and reply to the ESG self-assessment results, allowing SYSTEX to achieve digital sustainable management through digital technology.