Sustainable Supply Chain Management

CTCI Industry Chain

CTCI's customer base covers industries such as oil refining, petrochemical, chemical, natural gas, electric power, transportation, steel, and environmental engineering. We provide professional and consistent turnkey engineering services. Our professional engineers turn our customers' facility construction demands into engineering blueprints (including design and construction drawings), and further incorporate partner firms to complete the construction project according to the construction drawing. In the process of service, all the materials and equipment that we supply, as well as the construction standards and specifications that we follow, need to show sufficient professionalism to ensure the requirements of the customer are met and that the projects are finished on time. As an EPC turnkey company.

Sustainable Supplier Management

As of the end of 2021, CTCI, a global turnkey engineering company, has worked with more than 10,000 suppliers all over the world. In order to effectively manage so many suppliers from around the world and control such a large and complex supply chain, we categorize and classify our suppliers, so that we can effectively understand the overall supply chain status.
▼CTCI Group's Supplier Statistics by Region and by Year (including domestic and overseas subsidiaries)

CTCI Sustainable Supply Chain Management Framework

Supply Chain Code of Conduct

CTCI Vendor Code of Conduct applies to all suppliers and their subsidiaries, our affiliates, and our contractors that offer engineering products or services to CTCI. No supplier that has transactions with CTCI may be exempt from following such Code. Furthermore, as an effort to continue to enhance the sustainability of the supply chain, our policy demands all vendors who wish to become our new partners to sign a Statement of Commitment to Corporate Sustainability. From 2016 to 2021, 4,825 suppliers signed the statement, including all critical suppliers. Of all the suppliers that we have conducted businesses with in 2021, 418 suppliers have signed the statement, a signing rate of 88.2%. Please refer to the following table for the statistics of suppliers that have signed the statement in the past 3 years:

Supplier Sustainability Assessment

Besides requesting suppliers to follow the code of conduct, CTCI also wishes to bring positive influence over suppliers through actual procurement procedures. Take the critical equipment suppliers for example, we would pay visit to vendors to evaluate their performances. We would use an equipment/subcontractor qualification assessment standard documentation chart for reviewing the critical suppliers' qualifications in terms of their equipment and machinery. We do not just look at quality and HSE requirements, pricing, delivery timeliness, country of origin, production site, and port of origin, but also consider other sustainabilit y factors when evaluating the qualification of suppliers, including the vendors' integrity and management status, as well as whether they have been promoting HSE Management System internally. These sustainability factors account for 10% of the total assess ment score. 2022, we will also contribute to low carbon supply chainbased on the environment and information of suppliers, set scope 3 targets to reduce supply chain greenhouse gas emissions as CTCI joined SBTi, offer guidance and assistance to small enterprises in support of the government's policy of "the Large Enterprises Lead the SMEs." By doing so, we hope to play the role of industry leader in motivating proprietors and the supply chain to respond to climate action.
▼The Process of Sustainability Risk Investigation

▼Supplier Sustainability Risk Assessment

Survey Results

To ensure sustainable supply chain management, CTCI uses sustainability risk assessment results to identify potential risks in the supply chain related to economic, environmental, and societal aspects, as well as high-risk suppliers. In addition to using surveys as a means of risk evaluation, we also developed an auditing procedure for sustainability risks, and we use it to audit and counsel potentially high-risk suppliers to ensure that their risks can be effectively controlled and lowered.
▼Supplier Sustainability Risk Assessment Result

Supplier Visits and Audits

To control and manage sustainability risks of our suppliers, we have drawn up the supplier sustainability auditing procedures and have conducted auditing training for sustainability auditors. Suppliers are requested to fill out self-assessment forms. For suppliers with higher risks in previous year's survey results, we carry out audits the following year. The way of audit not only onsite audits but also utilize virtual reality headsets, video, assign third parties...etc. which are all qualified ways for CTCI. Due to COVID-19 pandemic, only 9 suppliers in Taiwan underwent sampling audit in 2021, four of whom were identified as suppliers with higher risk in 2020 and five were non-highrisk vendors. The major and minor defects and observations that were found during audits have all been rectified in time, thus achieving an improvement rate of 100%.
▼Five Aspects of Auditing

Enhance Supplier Sustainability Awareness

CTCI created a set of evaluation methods to pick out vendors with outstanding sustainability performances, by types and by scale. We will communicate such evaluation methods at the Supplier Meeting. If the vendors fully cooperate with the improvement scheme, we will give them Vendor Award for Sustainability Excellence. We wish to increase sustainability benefits through supplier meetings and work towards a brighter and more sustainable future together with suppliers.
▼Overview of Supplier Meeting over the Years

Sustainable Supply Chain Development Strategy

CTCI has always attached great importance to cooperation and growth with suppliers, and aims for common growth through mutual partnership and mutual support.

Supplier Evaluation

To ensure that CTCI's suppliers and contractors provide materials, engineering designs, construction, and manufacturing works that meet our clients' demands in terms of quality, HSE, pricing, and delivery schedule, our project procurement managers evaluate machinery and equipment suppliers/contractors based on the "Evaluation of Suppliers and Subcontractors Procedure" as soon as an engineering project begins In response to adjustments in the evaluation procedures, online evaluations have begun since 2021. A total of 547 completed projects have been evaluated. These meticulous evaluation tasks indicate CTCI's integrity and unbiased treatment towards all vendors, displaying our goal to create seamless partnerships and synergistic growth together with our vendors.

Local Procurement

In all of our engineering projects, local procurement is always top priority, for it can allow us help the economic development of each area where our operations are located, and can also help reduce carbon emissions from the transportation of materials.
▼CTCI's Percentage of Local Procurement at Key Project Locations, from 2019 to 2021

▼Supply Chain Management Key Performance Indicators (KPI)

Supplier Integrity Management Mechanism

CTCI has long upheld integrity management and always implemented the policy in supply chain management. We have set many codes and statements of commitment to regulate vendors' behaviors in integrity management and anticorruption based on principles of fairness, just and openness.