Walsin Lihwa adopts the "Continued development of high performance green products to reduce the impact on the environment by moving toward a circular economy and improving the performance of the application-end" strategy and is committed to achieving "recycling and reuse" in the use of materials. We optimize our production processes based on the principle of "energy saving and carbon reduction", and develop high-performance products that are "net-zero carbon and sustainable" in order to meet our commitment to assisting our customers and end-users in achieving energy efficiency and carbon reduction goals.

The Company actively engages in the development of CleanTech products, such as "wind power cables", "lightweight cables for heavy machinery" and "fast charging plug cables for electric vehicles," providing solutions for the renewable energy and electric vehicle industries. We began to lay out the solar power transmission cable market in 2016, secured an indicative project order in 2018, and consistently enhanced our engineering services at the project site, achieving a market share of over 25% in Taiwan in 2022. In terms of the development of cables in wind turbine towers, our initial focus was on torsion-resistant power cables in wind turbine towers for onshore applications. In 2020, we initiated the development of DC & HV cables for offshore wind turbine towers, and in 2023, we delivered HV cables for 9.5MW offshore wind turbines, and actively participated in the development of torsionally-resistant high-voltage cables for wind turbine towers exceeding 14MW and completed customer certification.

Wire and Cable Business Group focuses on the developing charging cable sets in response to the burgeoning global electric vehicle industry. In 2023, we completed the development and certification of CCS1/CCS2 series of DC charger cable set, applicable to mainstream charger cable set products ranging from 80A to 300A; The Resources Business Group introduced nickel pig iron (NPI) and converted it into a high-ice nickel manufacturing process, entered into the supply chain for batteries, and is actively laying the groundwork for the clean technology industry.

In 2022, Nanjing Walsin (Real Estate) T1 Office Building completed construction and began operations. The building is certified by the U.S. Green Building Council's Leadership in Energy and Environmental Design for Structures (LEED-CS, Core & Shell Development), as well as by the Green Building Council and the Gold Level Certification of the International WELL Building Institute.

Walsin examines and manages the environmental impact of products from the aspects of raw material use, energy use, and greenhouse gas emissions, etc. Use a high ratio of "recycled and reusable" raw materials to effectively utilize natural resources; In the production process, we are improving the production process of our plants based on "energy saving and carbon emission reduction" and continuously optimized. In terms of products, we aim to develop high-performance products that are "net zero and sustainable". We are committed to helping our customers and end-users achieve more energy-efficient and carbon-reducing products. Take the production of stainless steel as an example:

Adhering to the concept of "circular economy", Walsin reduces raw material consumption and increases recycling rates by improving production processes and technologies.
The production of copper wires and cables mainly uses highly recyclable pure copper. With the development of green products, recyclable TPE and PVC materials are partially utilized to replace non-renewable PE pellets and plastics. In 2023, the proportion of reusable raw materials used reached 92.09%.

Stainless steel production is carried out by the electric furnace steelmaking method, which utilizes a high percentage of recycled scrap steel and reusable iron alloys, including waste stainless steel, waste carbon steel, ferrochrome, and ferronickel, etc. In addition, the raw materials used include flat steel blanks, steel blanks, steel coils, steel rods, and coils. Scrap stainless steel and carbon steel are both recycled raw materials. In 2023, recycled raw materials accounted for 39.92% of the total raw materials. Ferrochrome, ferronickel, flat steel blanks, steel coils, steel blanks, steel bars, etc. are reusable raw materials that can be recycled and reused after being processed into finished products. The proportion of reusable raw materials used in 2023 accounted for 60.08 %.

Plan applicable packing materials and methods for wire and cable products based on product type, customer requirements, transportation needs, etc., prioritizing the utilization of recycled packaging materials (including but not limited to pallets, iron frames, iron shafts, wooden shafts, sealing boards, etc.) and lightweight packaging materials (such as lightweight steel plates) to achieve waste reduction and minimize environmental impact. In 2023, the quantity of packaging materials decreased by approximately 3,321 tonnes compared to the previous year, with recycled packaging materials accounted for 54.69% of the annual use of recycled packaging materials.

In order to fulfill the commitment of "environmental sustainability development, we focus on process and technology improvement, with the core strategy of "developing and innovating green technologies for process energy saving, product performance, and industry development". The focus is on the future expansion of "process and material", where we are committed to "resource saving", "water saving", "electricity saving", and "energy saving" as the long-term goal of green process development.

In 2023, Wire and Cable Business Group applied the IoT and equipment monitoring technology to establish a high-performance production facility at the Yangmei Smart Manufacturing Plant. By collecting information and data, we can monitor the status of production, sales and production processes, reduce manual intervention on the production line, and address uncertainties between product design and manufacturing, thereby reducing the use of raw material resources and carbon emissions. Future initiatives include installing solar power generation systems and using high-efficiency automated production equipment to achieve an annual carbon reduction target of 1.5%.

In addition, in recent years, the international community has promoted recycling scrap copper to produce copper materials, with carbon footprint and energy consumption reductions exceeding 60%^Note. In order to comply with ESG trends and requirements, many major international manufacturers now mandate that copper products contain a certain proportion of recycled copper (Apple and Google require suppliers to use more than 20% recycled copper). The Copper Materials Division of Wire and Cable Business Group actively promotes raw material recycling methods and utilizing scrap copper from within the group for development and research. The products already meet international standards, and we plan to apply for certification in 2024 to provide the highest quality products and support our customers to jointly achieve the goal of ESG corporate sustainability.