Nature-related Financial Disclosures (TNFD) | ACER ESG
Nature-related Financial Disclosures (TNFD)
In 2023, Acer became a member of Early Adopters of the Taskforce on Nature-related Financial Disclosures (TNFD), committing to identify nature and biodiversity-related risks and opportunities and respond accordingly, and planning to publish nature-related disclosure information in 2025. This initiative aims to gradually identify, assess, manage, and disclose dependencies, impacts, risks, and opportunities related to nature beyond climate-related risks and opportunities, and to respond proactively. Following the official release of v1.0 by TNFD in September 2023, the corresponding summary for 2024 is as follows:
Governance
Board Oversight
The Risk Management and Sustainable Development Committee is highest authority responsible for overseeing Acer's nature-related risks and opportunities. In 2023, the committee approved the Biodiversity Commitment, and in 2024, it presented the results of Acer's natural and biodiversity risk assessment to the Risk Management Executive Committee.
Management's evaluation and management
In 2024, Acer integrated risks associated with nature and biodiversity into its risk management policy and procedures. The Acer Risk Management and Sustainable Development Committee is responsible for reviewing and making decisions on related matters, including the risk environment, key risk management focus areas, assessment results, and response measures. The committee also supervises the continuous improvement to risk management to enhance performance, serving as the highest-level guiding body for risk management within the company.
Strategy
In 2024, Acer conducted a comprehensive analysis of significant value chain locations using the TNFD LEAP (Locate, Evaluate, Assess, Prepare) analytical method, utilizing tools such as the WWF Biodiversity Risk Filter, the World Database on Protected Areas (WDPA), and Key Biodiversity Areas (KBAs). It specifically focused on the circumstances and related impacts of these locations that are adjacent to or located within ecologically sensitive areas.
The scope of this analysis encompasses the entire value chain, including:
- Key suppliers
- Own operational scope identical to that of greenhouse gas inventory
- Top ten customers
The findings include:
- 1.7% of upstream suppliers are located within IUCN Category VI protected areas. These areas permit limited use of natural resources, provided such use is compatible with ecosystem conservation. Acer has engaged with the suppliers to ensure they have developed appropriate response strategies and monitoring mechanisms. We will continue to monitor these sites.
- For high-risk locations, analysis shows that 1.8% of upstream supplier sites are situated within Key Biodiversity Areas (KBAs). Further assessment indicates that these areas are home to species classified as Vulnerable (VU) by the International Union for Conservation of Nature (IUCN). However, the operational locations of the suppliers do not overlap with the distribution ranges of these species, and therefore, the risk of causing substantive impact to the species within the area is considered relatively low.
At the same time, in 2024, Acer participated in a joint project in collaboration with CTBC Financial Holding and a team led by Associate Professor Kuanhui Elaine Lin based at Graduate Institute of Sustainability Management and Environmental Education (GISMEE), National Taiwan Normal University (abbreviation: NTNU GISMEE TNFD). The project focused on implementing an investigation of Acer's sites in Taiwan to explore opportunities for extended cooperation. As part of this project, an materiality questionnaire to identify industry's attribution on natural capitals, together with the Taiwan ENCORE tool, was utilized to examine locally applicable industrial baseline data. This helped Acer conduct a more precise assessment of its operational dependencies and impacts on nature within Taiwan.
Risk Management
Following the comprehensive analysis of Acer's significant value chain locations as part of our strategy, we further assess the overall value chain's impact and dependence on biodiversity, identifying significant risk indicators:
| Potential Material and Transformation Risks | Response | Derived Opportunities | |
|---|---|---|---|
| Water Shortage | Many electronic manufacturing processes heavily rely on water resources, particularly in the production of semiconductors and electronic components. Water shortages may cause suppliers to reduce or suspend production, affecting material supply. When water shortages occur, suppliers need to invest in water resource management and alternatives, increasing production costs, thus raising supply chain costs. | Acer's operational model primarily focuses on product sales and customer service, so it does not use large amounts of water resources. We collect water usage data through systematic management and implement water conservation measures at major operational sites, including water recycling and reuse, improved water equipment, and enhanced water management. Acer encourages suppliers to adopt circular water systems that recycle industrial water, reducing dependence on external water resources. We also investigate water risk conditions throughout the supply chain to ensure stable supply chain operations. | Acer encourages suppliers to adopt circular water systems or innovative watersaving technologies and production processes to reduce dependence on water resources. This approach may enhance production efficiency while lowering longterm costs, and simultaneously strengthen operational resilience against sudden water shortage situations.
Additionally, smart water storage projects are being developed within Acer Group's business units. |
| Typhoons and Natural Disasters | Natural disasters such as typhoons, extreme rainfall, or earthquakes can damage production facilities and local transportation infrastructure, leading to interruptions or delays in material supply. These disruptions affect production schedules and timely product delivery, ultimately impacting sales and customer satisfaction. Facility damage caused by natural disasters often requires substantial financial resources for repairs and reconstruction, increasing operational costs. In high-risk areas, especially those experiencing frequent disasters, insurance premiums may rise, adding hidden costs to business operations. | Acer operates with many of its own facilities and supply chain locations situated near the Pacific Ring of Fire or in major typhoon formation regions, making geographical vulnerability an unavoidable inherent condition. To address the impacts of earthquakes or extreme rainfall caused by typhoons, we regularly review the adequacy of existing insurance arrangements (such as global property/cargo insurance policies) to ensure that potential operational risks are appropriately transferred. We also continuously strengthen relevant damage prevention measures to minimize the potential financial impact from extreme storms and earthquakes. | Acer's subsidiary, Acer eDC, serves as a cloud service provider combining data center capabilities, hybrid cloud-edge security monitoring, and cloud backup services. The company offers comprehensive cloud integration consulting services, implementing geographically distributed backup solutions across various industry information domains. During major natural disasters, Acer eDC ensures that critical business operations remain unaffected by significant information system failures or catastrophic events, enabling continuous operations. Through data redundancy and off-site backup mechanisms, the company helps enterprise clients build resilience, ensuring rapid recovery and operational continuity even in extreme conditions, thereby securing sustainable business operations. |
| Extreme High Temperatures | Extreme high temperatures can increase electrical grid loads, potentially causing power interruptions or instability that impact productivity and operational stability. Rising temperatures necessitate increased use of air conditioning and cooling systems, elevating energy consumption and costs, thus raising overall operational expenses. Furthermore, regions where Acer's supply chain operates may experience production line disruptions due to heightened electricity demand, unstable power infrastructure, or insufficient reserve capacity, leading local governments to implement power restrictions or large-scale outages. These disruptions can adversely affect product shipments and financial performance. |
| Acer implements energy conservation initiatives to progressively reduce unnecessary energy consumption during operations. This approach not only decreases energy expenditures but simultaneously creates a more comfortable and environmentally friendly workplace environment. These improvements enhance employee satisfaction and productivity while reducing the company's carbon footprint and minimizing operational environmental impact. At supply chain production facilities, through the promotion of ESG scorecards and the Earthion initiative, over 70% of our key suppliers have implemented ISO 50001 energy management systems. These suppliers conduct annual energy conservation and carbon reduction projects, reducing the likelihood of suppliers transferring energy usage costs through price adjustments that could potentially affect product competitiveness. |
| Water Pollution and Waste | The international community is placing increasing emphasis on environmental protection, requiring suppliers to invest more resources and thereby increasing their operational costs. If suppliers fail to meet environmental standards, it could affect Acer's reputation and the stable supply of its products. |
| Acer encourages suppliers to develop cleaner production technologies and collaborates on developing more environmentally friendly materials. By promoting green transformation among suppliers, Acer can enhance its green image and attract environmentally conscious consumers. When other competitors face challenges due to environmental issues in their supply chain, if Acer can maintain compliance or even lead the green transformation, it will have the opportunity to attract more consumer support and capture market share. |
Metrics and Targets
Regarding Acer's dependence and impact on nature, the corresponding internal management indicators and objectives are as follows:
| Supply Chain Management Targets | Own Operations Management Targets | |
|---|---|---|
| Water Resource | Strengthen supply chain water and waste management. | Total water consumption in 2030 needs to be reduced by 30% compared to 2019. For more details. |
| Climate Change | By 2025, 80% of key suppliers will commit to RE100 or set carbon reduction SBTs, and by 2030, value chain carbon emissions will be reduced by 35%. For more details. | In 2023, Acer committed to achieve the net-zero goal by 2050, set SBTs and product energy consumption targets, and a green product target of using post-consumer recycled plastics in core products, and released nine key net-zero strategies in three major aspects. We are committed to comprehensively reducing carbon footprint and emissions and mitigating our risks from carbon emissions in the three major strategic aspects of business operations, product services, and low-carbon supply chain. |
| Waste and Raw Material Usage |
| Total waste disposed in 2030 needs to be reduced by 30% compared to 2019. For more details. |