Welcome to Sustainable Development of Taiwan Sugar Corporation-Responses to Climate Change Risks

Climate Change Risk

Global climate change not only causes extreme weather but also directly or indirectly influences the operations of enterprises and consumption behavior of consumers. At the same time, under the pressure of carbon reduction, disaster prevention and energy shortage, costs of investments in technology improvement, equipment improvement and environmental protection have also increased annually, which will impact the competitiveness of Taiwan Sugar Corporation.

TSC refers to the framework of Task Force on Climate-related Financial Disclosures (TCFD) to take actions in response to climate change, demonstrating TSC’s responsibility and vision on climate issues in order to further allocate capitals more efficiently and move toward the sustainable development of a low-carbon economy.

In the future, TSC will implement the following corresponding measures or future planning in the face of Task Force on Climate-related Financial Disclosures (TCFD).

Aspect of Risk	Description	Corresponding Measures/ Future Planning
Market Risk	The rapid expansion of electric vehicle (EV) market and the policy of reducing fuel vehicles may affect the revenues of TSC’s Petroleum Business Division.	Set up stations providing services of both gas filling and battery exchange and cooperate with industry players in the evaluation of the installation of e-vehicle charging stations to gradually build potential customer base and participate in the EV market for business opportunities. Actively expand the sales of livelihood products to help increase the volume of dispensed gasoline and revenues with the services from outside ventures.
Imminent Physical Risk	The frequency of droughts and water shortage has increased, which will affect the agriculture and production departments.	Increase the area of ratoon sugarcane planting to reduce the dependence on water sources for irrigation. Set up Goals of Wastewater Recovery Rate (R2) and relevant water conservation measures. Regularly check and repair the irrigation pipeline system, clean the storage pond and sprinklers, and maintain the wells and water supply pipelines. The water wall cooling equipment at the greenhouse in the orchid farm adopts water circulation mode to save water by reusing it. Recycle and reuse pig-raising wastewater. Install rainwater collection equipment on the roofs.
Long-term Physical Risk Market	In a 2℃ scenario, the rise of sea level will affect TSC’s existing assets.	Choose high-lying countries when making overseas investments. Evaluate the development of vertical farms to reduce the field planting area.
Market Opportunities	TSC will launch low-carbon products.	Obtain the BS 8001 Circular Economy Certification and product carbon footprint verification to establish a lowcarbon brand image. Priority is given to local raw materials for the development of new products and product gift box packaging is simplified to reduce the carbon footprint of products. Design recyclable and reusable containers for our products, such as the reusable porcelain pots for the Phalaenopsis potted flowers. The beautiful gift box of the potted flowers of exquisite Phalaenopsis is specially designed and can be reused for item storage. We have launched special projects of “Green Stay Package”, low-carbon tour itinerary, bicycle-friendly accommodation, and discounts for guests traveling with their own tableware and personal amenities. We ask the government to lead the construction of a carbon sink trading platform to obtain trading certificates through TSC’s forests, renewable energy and other carbon reduction methods.

Other strategies to cope with climate change:

Policy	Description
Promote circular economy	Through the integration of agricultural integration, reuse of pig manure, biogas residues, and sugarcane bagasse and water recycling, a recycling network is created to reduce waste of resources and the use of fossil energy.
Carefully choose the timing of raw materials procurement	Internally, TSC set up a Bulk Cereal Procurement Team and a Bulk Sugar Reserve Price Setting Team. As required by the internal control system, the team members have to collect information of bulk materials such as soybeans, corn and sugar, the supply and demand situation and climate change situations at any time, and carefully select a procurement timing based on the production and inventory conditions.
Strengthen the advocacy and training of energy conservation	We organize annual training concerning green energy conservation and environmental protection to enhance our employees’ awareness of energy conservation. A total of 3 sessions of training were organized, with 112 participants in total.
Promote green energy	To work in line with the government’s green energy policy, solar PV power generation equipment is installed on self-owned roofs and unfavorable farming land to reduce pollution and carbon emission. To implement the carbon reduction policy, TSC’s affiliated livestock farms continue the collection of biogas for power generation, which is in line with the development of the green energy industry. As of 2020, a total of 83 solar power generation facilities as well as biogas power generation facilities in 4 livestock farms were installed, and the overall power generation totaled 0.27 MWh in 2020.
Promote green afforestation	Afforest on sugarcane land for economic benefits such as the increase of air quality, conservation of water resources and for carbon sequestration. A total of 11,957.84 hectares of afforestation land as of 2020.
Promote green procurement policies	To work in line with the Green Purchasing promotion program approved by the Executive Yuan, TSC makes purchase of eco-friendly and green products. In 2020, the green procurement ratio was 99.88%.