All suppliers are required to adhere to CT's “Quality Assurance Manual” as the standard for implementation. This requirement extends to their upstream suppliers to ensure consistency throughout the entire production process. The company is also committed to practicing social responsibility, promoting environmental sustainability, and upholding human rights. Collaborating suppliers are expected to adopt the same standards and follow the “Supplier Management Procedure” established by our company. Suppliers must cooperate with CT or a third-party auditing organization for audits. In the event of any non-compliance with our company’s quality control regulations, we reserve the right to request improvements and provide cooperative suppliers with guidance and assistance opportunities.

n   New Supplier Evaluation Mechanism

For suppliers that CT has been working with for years with favorable reputations before CT implements ISO 9001 quality management system, the procurement unit will prepare the tabulation, describe the reasons, and submit it to the President for approval; then, such suppliers may be directly registered in the list of qualified suppliers.

CT has established the “Qualified Supplier Evaluation Procedures” for new suppliers of raw materials; the procurement or the purchase requisition unit shall make recommendations, or the suppliers shall make applications; basic information shall be completed, and relevant documents shall be submitted based on the business items, and the evaluations shall be made based on one of the items described below:

(1) Sample evaluation.

(2) Field evaluation.

(3) Renowned supplier.

(4) Evaluation exemption (with a certificate: international quality assurance certification).

n   Regular Evaluation of Supplier

In 2022, the majority of CT’s main production raw material suppliers were from Taiwan. Among the top ten material suppliers, the domestic procurement (Taiwan) accounted for 51.53%, while overseas procurement (overseas regions) accounted for 48.47%. The main materials for the products include steel plates, structural steel, welding materials, and iron materials. For steel plates, the primary suppliers were Hkssteel, GS, and China Steel. For structural steel, the main suppliers were Honinco Honex Industry, Ying Fa Metal, and Hsieh Tai Shun Steel. The company does not adopt a raw material inventory model and prioritizes the procurement of required materials. Every December, the main material suppliers are assessed based on four key criteria: quality, delivery, coordination, and health, safety, and environmental requirements. The assessment results are used to determine the rewards and penalties for suppliers, following the established criteria for incentives and sanctions.

Award and Punishment After Evaluation

The results and evaluation of the audit on CT’s major suppliers

In 2022, CT had a total of 33 major suppliers, with 29 being domestic suppliers and 4 being foreign suppliers, all of which were agents. The suppliers were categorized into four main types: material supply (66%), spray coating treatment (10%), welding materials (14%), and assembly materials (10%), with material supply accounting for the largest proportion.

The main operating locations of the top ten material suppliers in 2022

n   Supplier Policy Questionnaire Survey

In 2022, CT did not have any new suppliers. Currently, environmental and social standards have not been incorporated into the selection criteria. To assess the sustainability risks of suppliers, a “Supplier Questionnaire” has been provided to the 8 main suppliers. Suppliers are required to respond to the execution status of the five sustainability dimensions: occupational health and safety, environmental protection, greenhouse gas emissions, human rights and labor guarantees, and sustainability reporting. No suppliers in 2022 had significant or potential negative impacts. Suppliers who have not addressed the five sustainability dimensions will be asked to comply with CT’s “Supplier Management Policy” and “Human Rights Policy” to ensure respect for human rights, compliance with relevant regulations, and fulfillment of social responsibilities.

n   Subcontractor

Due to the nature of the industry, CT has many projects that require a large amount of manpower on an irregular and short-term basis. To comply with equipment maintenance time constraints in production operations, the company often collaborates with subcontractors located in nearby areas. Personnel working as subcontractors within the CT premises are required to follow the company’s “Quality Assurance Manual” and “Environmental, Safety and Health Management Manual”. When partnering with new subcontractors, relevant documents such as licenses, factory registrations, company permits, registered business activities, and proof of tax compliance and insurance coverage must be obtained. Information regarding any significant environmental, safety and health incidents in the past few years should be disclosed accurately to facilitate classification and evaluation by the responsible departments. Site visits and inspections will be arranged accordingly. Depending on the subcontractors’ business activities, relevant units will conduct evaluations to understand their capabilities and determine whether they can become CT’s cooperating partners.