Sustainable Development Policy

Sustainable Development Policy
In accordance with the Sustainable Development Best Practice Principles, Tung Ho Steel established the following Sustainable Development Policy, which was approved in the 18th meeting of the 23rd session of Board of Directors on December 31, 2019.
Integrity Governance	Implement corporate governance, establish high-quality corporate culture, and work for corporate integrity management.
Economic Sustainability	Innovative technical services, enhance operating performance, maintain stable profitability and work for sustainable operations.
Environmental Protection	Actively respond to climate change, promote circular use of resources, continue to reduce waste, energy use and carbon emissions and work for the implementation of environmental protection.
Friendly Workplace	Establish a sound and complete system and harmonious labor-employment relations, and create a safe and friendly workplace environment.
Social Prosperity	Reward academic and humanistic development, pay attention to social issues, actively participate in public welfare activities and work for social prosperity.

Organizational structure of Corporate Social Responsibility Team

To implement the promotion of corporate social responsibility, Tung Ho Steel changed the “Corporate Social Responsibility Best Practice Principles (formulated in 2015)” to “Sustainable Development Best Practice Principles” in 2022. To improve the board functions and adjust the authorities of various functional committees, it was passed in the 2023 shareholders’ meeting to revise the Articles of Incorporation and rename the “Corporate Governance and Nominating Committee” the “Sustainable Development Committee”. The Sustainable Development Committee of the Board of Directors is responsible for the decision-making and supervision of sustainable development-related work, and it submits a report or resolution to the board of directors at least once a year.

Sustainable Development Committee of the board of directors of the Company is in charge of the decision-making and supervision of sustainable development related work, under which are the Environmental Sustainability Group, Corporate Social Responsibility Group, and Corporate Governance Group, which are respectively responsible for:

• The establishment, supervision and review of the Environmental sustainability (climate change management, water resources management) system and goals.
• The establishment, supervision and review of the sustainable development policies, system, or relevant management approaches of the corporate social responsibility.
• The establishment, supervision and review of relevant policies in relation to corporate governance, integrity management, and risk management, and the management mechanisms.

The members include representatives from all units of the Head Office, factories, and the Foundation. The Administration Department is in charge of the secretariat business, including the overall planning, communication and integration, data collection, and the editing and revision of the sustainability report.

Year	Development
2016	Voluntary publication of the first CSR Report
2017	Established Rules Governing the Internal Verification of Corporate Social Responsibility Report
2018	Tung Ho Steel was included in TWSE Corporate Governance 100 Index
2019	The CSR Team was incorporated into the Corporate Governance Committee and is subordinate to the Board of Directors Established CSR policy and human rights policy
2020	Established Risk Management Policy Established Supplier Management Policy
2021	Renamed the Corporate Governance Committee “Corporate Governance and Nominating Committee”. Publication of the first English Sustainability Report Publication of the first TCFD Report
2023	Passed the proposal of setting the Appropriation and Use of Special Surplus Reserve in Response to Climate Change Adaptation and Mitigation. 2030 Sustainable goals: Carbon reduction 30% + RE30 Renamed the Corporate Governance and Nominating Committee the “Sustainable Development Committee”

To ensure that the Sustainable Report issued by Tung Ho Steel conformed to GRI requirements and the prescriptions of Taiwan Stock Exchange Corporation Rules Governing the Preparation and Filing of Sustainability Reports by TWSE Listed Companies, the Rules Governing the Preparation and Internal Verification and Validation of Sustainability Reports was passed on April, 2024, and the internal verification operation of the Report is conducted annually to serve as a basis for the preparation, international verification and validation related work.

Education and training on the current ESG condition and trends was conducted in December, 2023, and the content included sustainable development and challenges, international trends, current legal prescriptions, introduction of revision of GRI Standards for topics and so on. In addition, meetings for stakeholder identification and questionnaire distribution were held. After data collection, meetings for group discussion and first draft discussion were convened in January and March, 2023. The verification team conducted the internal verification operation, and the Report was verified by an impartial third party. The issuance of this 2024 Corporate Sustainability Report was reported to the 2^nd meeting of the 3^th Session of Corporate Governance and Nominating Committee and the 9^th meeting of the 25^th Session of Board of Directors in May, 2024, and the content included the communication status with the stakeholders, the material topics, performance, and the requirements of the competent authorities. The Report was assured by independent and credible British Standards Institution (BSI) for the verification of this Sustainable Report and was issued upon the approval of the chairman.